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Fees on traffic congestion spread in England

A congestion charge zone in London, England

TEXT OF INTERVIEW

BOB MOON: Another British city is looking for some fast relief from congestion . . . of the automotive kind.

The idea of charging an extra fee in high-traffic areas seems to be catching on over there. And some drivers fear it could be the start of a nationwide system of traffic-based pricing.

Marketplace's Stephen Beard joins us from London. Greetings, Stephen.

STEPHEN BEARD: Hello, Bob.

MOON: Seems to me that this gives a whole new meaning to the idea of toll roads here. What's the plan taking hold? Could every road become a toll rode someday?

BEARD: Well, we're talking specifically here about one city in the U.K., and we're talking about a trial. This, if it goes ahead, will not be implemented til the year 2012. But the way it would work in Manchester, in the northwest of England, is that an electronic tag would be put inside the windshield of drivers intending to drive into the city. This would be tracked by satellite and/or a roadside monitoring device, and the driver would then be charged $4 to go into the outer zone, $2 to go into the inner zone, and then $2, a further $2 as he leaves each zone. So we could be talking about a total charge of $10 for taking your car in and out of the city of Manchester.

MOON: Well, this homing device idea makes me say, "Whoa." Are there any privacy concerns from tracking all these vehicles?

BEARD: Well, there is a privacy concern, certainly. But above and beyond that, there's a concern about the cost. The reaction to this Manchester proposal has been pretty hostile. I mean, you've got individuals saying "We work in the center of the city, we have to take our cars into the center of the city, this is gonna work out pretty expensive." This is a tax, they say, and it's unfair because it's regressive — it hits rich and poor alike. On the other hand, Manchester City Council and some large business organizations in the city say doing nothing is not an option. Congestion has an economic cost.

MOON: Economic cost? Are they also selling this as a way to improve the environment?

BEARD: It is both an economic and an environmental issue. This is one of the main reasons the British government, the central government, is interested in this and has invited cities around the U.K. to come up with road-pricing proposals. Not only to curb congestion in this overcrowded and densely-populated country, where traffic congestion is a major problem, but also this measure is seen as a way of tackling climate change, of reducing carbon emissions.

MOON: I know this idea to charge extra for driving in congested areas started out there in London. There was a lot of grumbling back when it was hatched, as I recall. Are people more accepting now that it's in place, by the way?

BEARD: Generally speaking, you're right — there was a lot of animosity, a lot of hostility towards it. But it has been in place now since 2003. The congestion charge has gone up — it's now $16 to take your car into the city and out again — but it has proved pretty effective. It has reduced traffic congestion substantially in Central London, and it has raised a lot of money, which has gone into public transport. And the buses and the trains in Central London are undoubtedly much better now.

MOON: Stephen Beard in London. Thank you for joining us.

BEARD: Thank you, Bob.

MOON: Brace yourself, by the way — this idea could be coming to your city. In case you missed it: Just last month, New York's mayor, Michael Bloomberg, proposed a new $8 congestion fee for drivers in parts of Manhattan during peak weekday hours.

About the author

Stephen Beard is the European bureau chief and provides daily coverage of Europe’s business and economic developments for the entire Marketplace portfolio.

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