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Electronic Road Pricing 2.0: A More Equitable Solution?

And so distance-based Electronic Road Pricing (ERP) is finally happening–earlier this week, the Land Transport Authority (LTA) awarded a tender for the next-generation ERP system, one that is based on the Global Navigation Satellite System (of which GPS is a subset). The hot-button issue here is that when implemented by 2020, ERP will move towards a distance-based pricing model. No more stopping your cars at the side of the road one minute before the ERP light goes off, people.

Pay What You Use

The new system has the man on the street lamenting that driving a car would become much like riding a taxi. That may be true, but only provided if you drive within the areas bound by the ERP. From the looks of it, the underlying principle (no matter how flawed) of ERP remains unchanged: to introduce tolls only along congested stretches of road.

In any case, distance-based ERP would benefit off-peak cars the most. Right now, if an off-peak car owner wishes to travel on a weekday during peak hours, they will need to buy a one-day e-Day Licence that costs $20. It’s a waste if you only need to make a short trip. Ostensibly, the new ERP system will be more equitable in such situations, as they may potentially be billed less.

Who Needs to Travel the Most?

When it comes to equitability, one thing that needs to be considered is that who needs to travel the most? Surely, it would be the group of people who stay far away from their workplace, or from popular weekend recreational hangouts.

Often, this is not by choice. I mean, I would love to stay somewhere near Orchard Road or just outside the CBD if I had the choice. But an apartment in the central parts of Singapore is prohibitively expensive, and for new or prospective BTO owners, you’re more than likely to end up with a unit somewhere far North or at the North-east, unless you were lucky enough to be selected as one of the winners of the Biddadari ballot.

So, as it turns out, it may be that the middle-class (i.e. those rich enough to afford a car but not rich enough to choose exactly where to stay) end up travelling more, not by choice by circumstances, whereas the stereotypical rich kid just needs to drive his Porsche down the road to his job at a posh investment bank. If the distance pricing isn’t tweaked properly, the middle-class suffers.

Less Congestion… Hopefully

If done right, however, I think the new ERP system will be more beneficial to motorists as a whole.

I think a common mindset when buying a car is that because you’ve already spent so much on COE, it’s a waste if you don’t use it every chance you get (if not, very sayang you know?). The new ERP system, to the chagrin of most, would make you think twice before driving that car out.

Abolish COE? Probably not

The ideal situation is that distance-based ERP will negate the need for COE. I’m sure all of us would be mightily pleased if this new ERP system became the one-stop solution to road taxes, COE et al. Oh, how we can all dream.

Unfortunately, apart from congested roads, one thing Singapore suffers is a lack of parking spaces. If we were to abolish COEs, we would have far more cars sitting idly in car parks, and parking in town would become more of a nightmare than it already is. Rather, the new ERP system will probably complement the use of COEs, rather than replace it altogether.

It’s All About the Implementation

At the end of the day, whether or not people will be happy about the new ERP system boils down to its implementation. Will it be implemented islandwide or at selected locations? How badly will the average motorist be affected? Will they pay more than they currently do, or will only heavy users be penalised? As for heavy users, are they penalised because they’re taking a joyride all around the city, or because they have no choice? The answers to these questions will determine if the new ERP system is a more equitable one.

It’s often said that the government always wins. Then again, 2020 will be pretty close to the next elections, so let’s see…

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