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London Congestion Charging Introduction

1. The London Congestion Charge is a fee that is levied on all motorists entering the

Central London area. Although London is not the first city to adopt congestion charging, it is the largest city to do so as of 2003. The organization responsible for administering

the charge is Transport for London (TfL).

2. The fee was introduced on February 17, 2003. The daily fee of £5 (approximately

7.50 or US$8) must be paid by the registered owner of a vehicle entering, leaving or moving around within the Congestion Charge zone between 7 a.m. and 6:30 p.m., Monday to Friday. The aim of the scheme is to encourage travellers to use public transport, cleaner vehicles, cycles, motorcycles or their own two feet instead of motor cars and vans, thus reducing congestion and allowing for faster, less polluting and more predictable journeys. TfL says that much of the money raised in the scheme will be invested in public transport. Another city with a congestion charge is Singapore.

The Charging Zone

3. The zone includes the whole of the City of London, the city's financial district, and the

West End, the city's primary commercial and entertainment centre. There are also 136,000 residents living within the zone (of a total population of around 7,000,000 in Greater London), though the zone is primarily thought of (and zoned as) commercial

rather than residential.


4. Two hundred and thirty CCTV-style cameras, of which 180 are installed at the edge

of the zone, record a stream of video of roads in the zone. There are also a number of

mobile camera units which may be deployed anywhere in the zone. It is estimated that around 98% of vehicles moving within the zone will be caught on camera. The video streams are then transmitted to a data centre located in Central London where a computer system equipped with Automatic Number Plate Recognition (OCR) software deduces the registration plate of the vehicle. A second data centre provides a backup location for image data.

5. Although this process is not infallible, the process only needs to have a reasonable

probability of success to have a deterrent effect. It appears that both front and back number plates are being captured, on cars going both in and out. This gives up to four chances to capture the number plates of a typical car entering and exiting the zone.

6. There are fifty additional camera installations within the zone intended to increase the

probability of catching vehicles that have entered the zone without being caught on

entry or exit. This list is then compared with a list of cars whose owners/operators have paid to enter the zone. Those that have paid but not been seen in the central zone are not refunded but those have not paid and are seen are fined. The registered owner of such a vehicle is looked up in a database provided by the Driver and Vehicle Licensing Agency (DVLA), based in Swansea. The fine is £80 (~€119 or US$127). From 10.00 pm the charge is doubled to £10 (~€15, US$16): this is intended to cut the number of last- minute payments.

7. Some vehicles such as buses, minibuses (over a certain size), taxis, emergency

service vehicles, motorcycles, alternative fuel vehicles and bicycles are exempt from the charge. Residents of the zone are eligible for a 90% discount, if they pay the charge for

a number of days at once.

Why the Congestion Charge is notable

8. The congestion plan has attracted a lot of attention for several reasons. It is the first

large scale congestion charge scheme to be introduced in the UK. If successful in reducing traffic congestion, other busy cities around the world are likely to follow suit. The plan relies on advanced technology. Drivers may pay the charge on the Web, by SMS text message or by phone. The total cost of implementing the scheme, including setting up the cameras, the call centre for processing payments and advertising to notify motorists of the scheme's introduction is in excess of £250m (~€375m,US$400m). The

scheme is expected to pay for itself within three years.

9. The whole idea has been heavily criticised by some opponents. They argue that the

public transport network has insufficient spare capacity to cater for travellers deterred from using their cars in the area by the charge. Further it is said the scheme will hit poorer sections of society more than the rich, as the charge to enter the zone is a flat £5 for all, regardless of vehicle size.

10. Transport for London contracted Capita to implement the scheme. Subcontractors

include Mastek Ltd, based in Mumbai, India, who are responsible for much of the IT infrastructure. They claim that it is the largest project to date implemented using Microsoft's .Net platform. Due to the wide spread around the globe of sub-contractors and because some data protection regulations vary from country to country, the scheme has prompted concerns about privacy from technology specialists (see external link).

11. In a surprise move, the Royal Automobile Club (RAC) has “reluctantly” backed the

need for congestion charging in some areas, to avoid future gridlock. Their report ‘Motoring towards 2050’ concludes that “the car will remain the predominant mode of

transport” but questions the best way to “balance the benefits it provides against our concern for the environment”.

It predicts that traffic growth will continue but that new technology will solve problems

associated with global warming and air pollution from cars.

12. But it says that an extended road network, improved public transport and better

long-term planning will need to be supplemented by new motoring taxes to restrain demand. Improving public transport would have some effect on car use in urban areas, but would offer little restraint on overall traffic growth. “The good news is that technology will clean up the car,” said RAC Foundation chair Sir Christopher Foster. “The bad news is that congestion will get worse without radical action. Many may be surprised that a motoring group has opted for charging but our report shows that the alternatives are worse. The report concludes that the “government must ensure that charging is part of a fair deal and must not rip off motorists, which could lead to them voting with their wheels”.

Early experience of the London Congestion Charge in action

13. The congestion charge was introduced February 17 2003. Before the Charge's

introduction there were fears of a very chaotic few days as the charge bedded down. Indeed Ken Livingstone (London mayor and key proponent of the Charge) himself predicted a "bloody day". In fact, the first two days saw a dramatic reduction in inner city traffic. On the first day 190,000 vehicles moved into or within the zone during charging

hours, a decrease of around 25% on normal traffic levels. Excluding 45,000 exempt vehicles, the decrease was more than 30%. Anecdotal evidence suggests journey times were decreased by as much as half. Just over 100,000 motorists paid the charge personally, 15-20,000 were fleet vehicles paying under fleet arrangements and it is believed around 10,000 liable motorists did not pay the due charge. An extra 300 buses (out of a total of around 20,000) were introduced on the same day. Bus network and London Underground managers reported that buses and tubes were little, if at all, busier than normal. Anecdotal evidence has suggested that crowding - which always a problem at rush-hours on the tube network - has increased somewhat.

14. Initially it was believed that the reduction in traffic was caused by the half-term

school holidays but this has proved not to be the case. Reports consistently indicate that over the first month or so of operation, traffic has been down at least 15% on pre-

Charge levels (the first week had a decrease of 20%, the first day 30%). Journey times have correspondingly crept back towards pre-Charge levels, following initial reported time-savings of as much as 50%. Although very precise statistics are less readily available than just after the Charge's introduction, chiefly because media attention is now directed elsewhere, the general feeling is that the Charge is having the intended effect.

15. Fears that 'rat runs' of commuters skirting around the edge of the zone would cause

traffic problems have not yet been realised. Cautious optimism, coupled with a desire to see the promises of major improvements in public transport made good, seems to be a

common attitude among London travellers.

Future Plans 16. In the aftermath of the introduction of the Charge, there have been a number of suggestions for the future of the Charge. In November 2005, speaking at a conference of business leaders, the secretary of state for transport, Alistair Darling said more "radical measures" were needed to tackle congestion and he added that he supported the development of a national road pricing scheme. Mr Darling told delegates. "Congestion is bad for business, frustrates motorists and hurts local economies."

"I'm convinced that without more radical measures, including more effective demand management, and actively managing traffic flows, road congestion will get worse," he said, adding that this was why he had been very clear about the need to look at road pricing.

Local authorities in seven areas are to share £7m to explore new ways to tackle road congestion, which could include the introduction of a congestion charge similar to that in operation in London.

The authorities, which include those in Greater Manchester, Bristol and the West Midlands, will assess the feasibility of combining better public transport with new systems to charge drivers for road use.

The Confederation of British Industry (CBI) called on the government to commit an extra £1bn over the next two years on road and rail projects, after its research showed that delays and other problems were hitting productivity and causing stress among workers.

And it said total spending by private firms and the government should be lifted by £60bn over the next 10 years to £300bn.

A survey of more 1,000 firms and individual workers for the CBI showed "widespread dissatisfaction" with the nation's infrastructure.

Half of those polled believed the UK's reputation as a place to do business was being significantly harmed by transport problems.

Two-thirds of firms expected the transport system to get worse in the next five years, and half said transport problems were having a substantial impact on their profits.

Two out of five said staff were often late for work and arrived stressed because of delays.

And the overall cost to business of transport-created problems was put at 5% of turnover.

"Although transport spending has risen in recent years, there are decades of under- investment to deal with and it is clear that business still finds it far too difficult to get its goods to market and its people to work," said Sir Digby Jones, the CBI's director general.

"The government must ensure more is done now to improve the transport network if its business-friendly credentials are to have any credibility.

He said spending on transport was set to increase from £10.4bn this year to £12.8bn in 2007, when transport spending after inflation will be over 60% higher than in 1997.