Towards transit incentive and private auto disincentive

• Development and management of the transportation system (with the emphasis on public transport);

• Congestion reduction (with emphasis on the systems of traffic management and parking in urban centres);

• Establishment of minimum levels of accessibility for communities;

• A system for prioritising investment projects in the transport sector; and,

• The financing of transportation infrastructure and facilities and rationalising of subsidies.

The Singapore Public Transport Council recognised that “The government has to take an important role in defining the role of public transport and pursuing policies that encourage and favour their use over that of private transport. This is unlikely to be a popular measure among the many car owners and aspiring car owners, but unless such a stand is taken, public transport will always be viewed as the mode of ‘last resort’ and as a residual mode for those with no access to cars.” The question of subsidies and concessions needs to be discussed. It is well-established that, in transportation, general subsidies do not work: any subsidies should be userdirected.

This enables the Government to be clear about what it wishes to subsidise, and also to evaluate its own policies.

The transport supplier then has a much more clearly-defined task than in the case of a general subsidy.

It is recommended that all Government transport subsidies should be user-directed.

Directed subsidies play an important role in dealing with accessibility. Low accessibility can have a variety of causes, including sparseness of population, difficulty of terrain and crime. The best way of dealing with these areas is to have subsidised operators bring travellers to the nearest ‘collection’ point. This is the ‘hub-and-spoke’ pattern common in airline operations. Its advantage is that it is

• Transparent, in that costs are known;

• Flexible, in that the total subsidy can vary by time of day. This is useful in areas where there are, for example, sufficient hometo- work trips to warrant full public transport attention at peak hours, but low activity levels otherwise;

• Dynamic. The accessibility of regions can change for any number of reasons: change in popularity of some activity in the area, building of roads, drops in crime.

Corresponding changes can then be made to the subsidy.

An important transport policy measure for overall transportation development and management is public transport incentive and private auto disincentive. Auto-use disincentives are considerably difficult to implement because they affect some people negatively and therefore face political opposition. Broad-brush approaches require minimal management for implementation and are likely to be the least effective, because they have limited impact on the real culprits in high vehicle usage: (1) multiple auto households, and (2) single occupant vehicles or SOVs.

I have recommended in the past, the introduction of annual vehicle permit taxes on households with multiple vehicles, so that for the first vehicle the permit tax may be zero (or lowest), and for every additional vehicle there would be an increasing sliding scale of permit taxes.

Fuel subsidy reduction should not primarily be a tax revenue measure, but an SOV-removal technique. The issue of subsidies for public transport and goods transport has to be further discussed. Transit fuel subsidy cannot be developed without proper analysis of current privately operated public transport. For example, what will prevent someone purchasing an H-registered vehicle simply to receive transit fuel subsidy.

Also, pickup trucks are quite popular these days – how will you prove that they would be used for goods transport, in order to justify them for goods fuel subsidy? What is clear is that management of these subsectors is necessary as a prerequisite.

In the case of public transport, I have been arguing for a transit authority for some time. Goods transport movement and management is an area still understudied.

Other disincentives may include increased vehicle purchase costs, while attempting to reduce the cost to replace transit vehicles and parts; and, on-street parking charges and enforcement and increased parking charges in urban areas; etc.

The issue of subsidies is very sensitive in most jurisdictions and particularly in Trinidad and Tobago where the population has grown accustomed to large subsidies on most publicly supplied goods. It is strongly suggested that the current system of subsidies be directed to support transit operators as a positive incentive to public transportation providers and redirected from fuel subsidies at the pump as a disincentive to unrestrained private car use.

Also, the policy of high personal auto use, maintained by successive Governments for the past 20 years, continues to be a tremendous drain on foreign exchange for both new and foreign-used purchases.

Is any Government brave enough to tackle this?