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Preliminary Results On Current Practice

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

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Preliminary Results On Current Practice

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  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 ? T+C: 2nd best ? ? T T+C: 2nd best T+C: 2nd best T+C: 2nd best T+C: 2nd best T+C: 2nd best T+C: 2nd best T+C: 2nd best T+C: 2nd best T+C: 2nd best

  10. C: 2nd best 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 None* C: 2nd best C: 2nd best None

  11. C: 2nd best Air mode: pricing schemes ? ? C: 2nd best ? T+ C: 2nd best C: 2nd best C: 2nd best C: 2nd best T+C: 2nd best T+C: 2nd best C: 2nd best ? C: 2nd best C: 2nd best

  12. C: 2nd best Inland waterways mode: pricing schemes ? ? ? ? None C: T- O ? ? C: T- O C: T- O None ? ? C: T- O

  13. C: 2nd best Maritime mode: pricing schemes ? ? ? ? C: 2nd best C: 2nd best C: 2nd best C: T- O ? C: 2nd best ? C: T- O

  14. No Earmarking of revenues? 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.

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