How paying a fair price could tackle the cost of congestion

Friday 25 November 2016

Infrastructure Victoria has today released a discussion paper outlining how the introduction of a well-designed road pricing scheme could help address growing congestion on Melbourne roads.

The independent agency’s paper The road ahead forecasts how congestion is set to worsen in the future and outlines the potential benefits of road pricing.

Infrastructure Victoria Chief Executive Michel Masson said road pricing, as a first step towards a comprehensive, transport network-wide regime, would deliver significant benefits.

“Good road pricing will help manage demand, make travel times more reliable, reduce the costs of goods and services, reduce emissions and improve amenity,” Mr Masson said

“Motorists already pay to drive through car registration, Commonwealth fuel excise, parking fees, tolls and other taxes, but the current pricing system is not fair, efficient or sustainable,” he said.

Mr Masson said Infrastructure Victoria supported the national reform agenda which advocates for a comprehensive review of road user charges.

“We welcome the announcement by the Federal Government yesterday that it is launching an investigation into road pricing for all vehicles because we want an open discussion with the community and all levels of government about the different approaches that could be taken to pricing.

“Road pricing should not be another tax – it should replace, reduce or streamline existing fees and charges, creating a fairer way of paying to use the road,” Mr Masson said.

The paper predicts that by 2030 congestion on Melbourne’s road will cost every Melbourne resident an extra $1700 a year, and by 2046 the average speed during morning peak will have slowed to just 31 kilometres per hour. 

“No city can just build its way out of congestion,” Mr Masson said.  “Experience shows that just building infrastructure attracts more users until it’s congested again, so we need to introduce demand management as part of the solution in tackling congestion.

“We identified introducing a comprehensive transport pricing scheme as one of the top three recommendations in our draft strategy because it is clear that decisive action is required.”

Infrastructure Victoria recommends the revenue generated by a road pricing regime be invested directly back into transport infrastructure and services.

The report also stresses that road pricing should not be introduced unless the public transport network can cope with increased demand.

“Road pricing should support people shifting to public transport at peak times, so it is imperative that adequate public transport infrastructure and services are in place first,” Mr Masson said.

The paper outlines four potential models for road pricing, and considers overseas case studies such as London and Stockholm.

“We have a long way to go before we can make a recommendation about what model would work best in Melbourne, which is why we are asking for community input,” Mr Masson said.

“Involving the community in the conversation is essential to ensure we can design a road pricing scheme that considers all of the potential impacts and benefits,” he said.

To read the discussion paper and supporting documentation or provide feedback visit

Consultation is open until 5.00 pm, Wednesday 15 February 2017.



  • Congestion already cost the Victorian economy $4.6 billion last year, a figure expected to more than double by 2030.
  • By 2030, congestion will cost every Melbourne resident an extra $1700-a-year or $7 extra each working day.
  • By 2046, the congestion on roads in Melbourne’s west will be as bad as inner city Melbourne today. Melbourne’s north will be even worse.
  • In 2046, it is estimated it would take an extra 45 minutes each morning to drive from Epping to the CBD, a journey that already takes an hour.
  • The average speed during morning peak traffic is forecast to drop from 38 kilometres today to just 31 kilometres per hour by 2046.
  • More than half of all car travel will take place on congested roads in 2046.


  • Road pricing could cut travel times on congested roads at peak hour by up to a third
  • Road pricing combined with $40 billion of road and rail investment will have a profound impact on congestion. Without road pricing, congestion will get significantly worse - even if we build new roads and rail.
  • According to Victoria’s travel survey, one in five car trips during morning peak hour are not related to work or study.
  • If traffic was reduced by just 5 per cent during morning peak hour, it would be equivalent to school holiday road conditions every day of the week.