Toll Road Revolt in South Africa

In Gauteng Province (South Africa) an ambitious and expensive toll road scheme has been put on indefinite hold 2-days before its launch due to popular, trade union, business leader, and Automobile Association protest according to The Economist (It doesn’t toll for thee 2012.05.12). This will have significant financial repercussions for the road authority and the government. In easy hindsight, there is little surprise this happened.

Road operators are in desperate need for funding the world over.  And roads get more congested every day. But installing a one-size-fits-all tolling system on a pre-existing road network does not go down easily. However necessary for any number of reasons, this indeed “represents the state’s bullying power” as The Economist bluntly put it.

Image from article in The Economist. Copyright:The Economist

Adding new lanes and tolling them as high-occupancy/toll (HOT) lanes for discretionary use meets little resistance. But tolling major routes that have few or diminished alternatives would generally be received poorly. People who have had free access to roadways for as long as they remember, expect free access to remain available as long as they live. In behavioral economics lingo, they are “anchored” to a road-price of zero. You can’t just start charging US 12 cents per mile on a Monday at 12:01am, which is what was to happen in Gauteng.

To have acceptance, you have to make the individuals subject to tolling better off than they were without tolling. Drivers don’t buy into tedious economic arguments about highway funding and congestion and pricing and the tragedy of the commons. They ask: “What’s in it for me?”

Here is an alternative.

Phase in gradual fuel duty increases over a few years expressly to pay for new or repaired roads. Preannounce the full plan to give users time to adjust (move, renegotiate contracts, different vehicle, etc.). This will be difficult enough.

Concurrently provide a voluntary choice: pay the newly increased fuel tax or use an autonomous, in-vehicle, time-and-place of use meter to trade road tolls for a fuel tax rebate (calculated by the same meter). Arrange the road prices (stored in the personal in-vehicle meter’s “pricemap”) to have drivers who avoid congestion save money with the meter and other drivers to pay about the same as the fuel tax. Then be sure that the smart in-vehicle meter offers several additional features that those self-selected drivers would like (reduced insurance premiums, parking conveniences and discounts, etc).  The trick is (again according to behavioral economists) to provide at least twice the perceived value to the driver than the perceived cost (nuisance, money, trouble) of using the meter. This is technically easy to do (including privacy, security and reliability), but needs policy that encourages usage-based insurance and permits wireless parking management and perhaps behavioral rewards for safety, emissions, and the like. Without associated value-added services and incentives with benefits that counterbalance this type of increasingly needed tolling, governments are not offering a vote-worthy solution.

What we are missing are policies to incent innovation and permit voluntary migration. We need a telemetrics-payment ecosystem that allows driver services to move metering away from one-size-fits-all gantries for users with a variety of needs.