Singapore already devotes 12 percent of its surface space to roads. This figure has oft been cited as the reason for keeping a lid on the number of cars here, lest we experience economy-sapping gridlocks that major cities the world over grapple with. But it is usage that causes congestion, not ownership per se. In fact, economists have pointed out that the higher the cost of cars, the more people will use their cars. It is a theory called loss aversion.
So, what if there is something that manages usage? Electronic road pricing, you say? There are a number of problems with ERP. Rates are low when compared with car ownership cost, there is a political reluctance to raise rates dramatically, and charges, once paid, allow a motorist to drive to his heart’s content within a priced zone (in many cases, the city centre).
These shortcomings can, however, be overcome with the next generation of ERP – a variable, real-time, satellite-based system that can charge for distance driven. If applied properly, this could well be the thing that allows more people to own cars in Singapore.