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THE VIEW European Transport Financing Dr Andreas Kossak

What matters in road pricing: fairness, efficiency or sustainability?

Dr Andreas Kossak is Principal of AK Research & Consulting, based in Hamburg, Germany


n 1995 the European Commission released the Green Paper Towards Fair and Efficient Pricing in

Transport. Five years later the German government-appointed High Commission on Financing the Transport Infrastructure (the Pällmann Commission, oſten referenced in this column) recommended a gradual total change to financing road infrastructure based on distance and strain-related road user charges (variable by location and time/traffic management) – in particular referring to the criteria of fairness, efficiency and sustainability. Te recommendation was accepted and welcomed by all relevant lobbyist groups in Germany – and subsequently by politics too. All high-level commissions

worldwide that worked on the respective subject in the subsequent years came up with principally the same results like the Pällmann Commission, including: • UK Commission for Integrated Transport (Paying for road use, 2002),

• Swedish Road Taxation Commission (Skatt pả väg, 2004)

• US National Surface Transportation Infrastructure Financing Commission (Paying our Way, 2009).

Germany started the change by preparing the introduction of distance-related tolling for the use of Autobahns by heavy trucks. According to the recommendation of the Pällmann Commission tolling was

based on GNSS/GSM technology in order to be able to expand it to non-limited access roads, and in


the future cars, without technology change. In those days Germany was internationally envied for both its decision and its plans in this respect. Before tolling started in January 2005 however, the government decided, contrary to the recommendations of the Pällmann Commission and to its own previously stated promises: • To use the toll revenue not for bridging the undisputed latent financing gap in the road sector but to reduce the financing budget by the same amount; and

• To distribute the revenue to all transport infrastructure sectors, although this more a case of same money, different pocket.

In reaction to that lobbyist groups immediately revoked their approval for the expansion of road user charging to a total refusal. In such a situation it seems to be

the simplest solution for politicians to hide their fear of not being re- elected by taking over even the most

abstruse lobby arguments against road user charging – thus acting in contradiction to their primary task as public representatives to strive for the best solutions for the public. In the foreword to the 2011 publication Te Acceptability of Road Pricing, Prof. Steven Glaister, the director of the UK Royal Automobile Club Foundation (RACF) made it clear that “we should be willing to embrace the messages of this report and to recognize the benefits that new charging systems for roads have delivered… in many countries... Far from being a vote-loser the evidence is, that if it is introduced in the right way, road pricing can be perfectly acceptable for the majority of the population.” Tis has obviously not yet been

Lobbyist groups

reacted to the German Government’s decision by immediately replacing

their approval of the

expansion of road user charging to a total refusal

heard and “embraced” respectively everywhere. Te final report of the German Commission on the Future of Financing the Transport Infrastructure of December 2012 included the systematic expansion of road user charging as part of a “toolkit”; as a political commission it was supposed not to recommend certain tools or options. Shortly aſter the publication of the report a member of the commission declared in a press release: “In full compliance with all Federal States that I am representing in the commission (five out of 16) I clearly reject any road pricing for cars.” Te arguments behind that position are, according to, admittedly, rumour, that collecting user charges from cars is unfair and antisocial. Facts and expert knowledge still

seem not to be convincing enough to pave the way for a future fair, efficient and sustainable financing of the road infrastructure. Tis means that there is still a lot of work to be done.

Vol 8 No 2 Europe/Rest of the World

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