Forum: Distance-based ERP can result in inequitable outcomes

An Electronic Road Pricing (ERP) gantry near State Courts on Sept 3, 2020.
An Electronic Road Pricing (ERP) gantry near State Courts on Sept 3, 2020.ST PHOTO: LIM YAOHUI

The letter "Distance-based road charging is equitable" (Sept 18) is overly simplistic and does not consider complexities and known outcomes in transport equity, a topic long studied by transport academics.

Flat-fare subway systems are in fact common, being used in cities like New York, Los Angeles and Paris, and the question of equity has been extensively debated. Studies on fare equity make a distinction between vertical equity - equity between individuals belonging to different groups - and horizontal equity - equity among individuals in the same group.

A June 2020 review of this topic by Mr Isak Rubensson in the journal Transport Policy reveals that the impact on equity depends largely on the spatial distribution of a population. In denser European style cities where high-income residents live closer to the city centre, a distance-dependent fare is horizontally equitable but has poor vertical equity. The reverse has been shown to be true for vertical equity in US cities where poorer residents live in the inner city while the more affluent population lives in the suburbs.

In Singapore, we have a hybrid system where full fares on public transport are based on a distance charging system, but flat fares are available through schemes like student concession passes and adult monthly travel cards. These schemes reduce the transport burden for residents living in the suburbs, hence increasing vertical equity.

A pure distance-based Electronic Road Pricing (ERP) system would be horizontally equitable but depending on its design, could have poor vertical equity, placing an increasing burden on those living in the outlying suburbs. While it is true that in the current system, motorists in the suburbs sometimes pay more by passing through more ERP gantries, this is very often not the case.

For example, a motorist travelling from Changi to the city via East Coast Parkway currently pays the same as someone travelling from Marine Parade. Similarly, a motorist travelling to the city from Pasir Ris via the Pan-Island Expressway pays the same as one travelling from Bedok.

Our current public transport pricing system does take vertical equity seriously and I do think it is important that we continue to consider this when designing any potential future distance pricing system, especially at a time when we are seeing rising concerns about social inequality in Singapore.

Jeremy Teo Chin Ghee (Dr)

A version of this article appeared in the print edition of The Straits Times on September 22, 2020, with the headline 'Distance-based ERP can result in inequitable outcomes'. Print Edition | Subscribe