Preliminary Results On Current Practice

1
Preliminary Results On Current Practice
Maurits van der Hoofd Urs Springer Miguel
Carmona Stefan Suter Eduardo Pires Paavo
Moilanen
2
Review of current practice and classification of
pricing and revenue allocation schemes

• Objectives
• Dimensions and criteria for the description of
  pricing and revenue allocation schemes
• Pricing and revenue allocation schemes digest
• To what extent are current practices conistent
  with theory?

3
Fact sheets scope

• DoW This task will review and identify the ways
  in which revenues are collected and assigned
  across Europe
• to make a general survey of current practices of
  revenue use in the EU
• Awaiting input from Work Package 2
• Therefore focus lies on pricing schemes for now
• The results are preliminary as the investigation
  is still continuing.
• Countries described are EU15 minus Luxembourg
  plus Switzerland.

4
Modes considered

• Pricing schemes were investigated for the
  following modes
• Road especially motorways
• Rail infrastructure charges
• Urban PT bus, tram and metro
• Air landing charges and other purely
  aeronautical charges
• Inland waterways
• Maritime port dues

5
Aspects considered

• Pricing schemes
• Earmarking of funds
• Revenue allocation schemes (to be developed)
• Design and allocation rules
• Forms of co-operation between the public and
  private sector
• Role of the institutions in the decision-making
  process

6
General approach
7
Pricing principles

• Pure social marginal cost pricing
• Price marginal resource cost marginal
  external cost
• Marginal cost pricing
• Price marginal resource cost
• Second best solutions
• such as multi-part tariffs, Ramsey pricing,
  SRMCP mark-ups
• Target-oriented price schemes
• No differentiation between user type, time of day
  etc. (eg ACP)

8
Pricing instruments

• Charge A payment that is directly linked to a
  particular service from a public or private
  provider.
• Infrastructure access charges
• Road tolls
• Bridge/tunnel charges
• Tax A levy that must be paid to the government
  without any clearly related service.
• Vehicle registration taxes
• Fuel taxes
• VAT

9
Road mode pricing schemes
T
?
TC 2nd best
?
?
T
TC 2nd best
TC 2nd best
TC 2nd best
TC 2nd best
TC 2nd best
TC 2nd best
TC 2nd best
TC 2nd best
TC 2nd best
10
Rail mode pricing schemes
C 2nd best
?
C 2nd best
?
?
C 2nd best
C 2nd best
C 2nd best
C 2nd best
C 2nd best
C 2nd best
C 2nd best
None
C 2nd best
C 2nd best
None
11
Air mode pricing schemes
C 2nd best
?
?
C 2nd best
?
T C 2nd best
C 2nd best
C 2nd best
C 2nd best
TC 2nd best
TC 2nd best
C 2nd best
?
C 2nd best
C 2nd best
12
Inland waterways mode pricing schemes
C 2nd best
?
?
?
?
None
C T- O
?
?
C T- O
C T- O
None
?
?
C T- O
13
Maritime mode pricing schemes
C 2nd best
?
?
?
?
C 2nd best
C 2nd best
C 2nd best
C T- O
?
C 2nd best
?
C T- O
14
Earmarking of revenues?
No
Some air tax to noise abatement
100 of HGV to infra Part of fuel tax to regional
infra
?
?
67 of HGV to rail infra, 33 to regional road
infra Some air tax to noise abatement
?
?
No
Some municipal tax from urban companies to urban
PT Electricity tax to inland waterways
58 of road to tunnels 2.5 of electricity tax to
urban PT
No
?
?
No
15
Preliminary Observations

• SMCP not observed, but internalisation occurs
  more than before
• Roads and railways where 2nd best solutions are
  more used
• No specific pricing schemes for urban PT except
  France
• Aviation charges (aeronautical) constrained by
  IATA, often multi-part tariff or another
  second-best scheme
• Very few examples of the application of taxes and
  charges in inland waterways
• Ports least regulated, often operate without
  govt. funding

16
Pricing and revenue allocation schemes digest

• To be done after completion of the fact sheets
• To cover following aspects
• Pricing regimes (principles/instruments)
• Earmarking of revenues from transport pricing
  schemes
• Revenue allocation rules
• Objectives and design of the revenue allocation
  schemes
• Subsidies and cross-subsidisation
• Legal framework and institutional settlement
• Transport funds
• PPP
• Institutional solutions

17
To what extent are current practices consistent
with the theory?

• Pricing doctrines
• Revenue allocation schemes
• Preliminary assessment to be carried out after
  the conclusion of the fact sheets.