SUSPENSION OF ELECTRONIC ROAD PRICING

Mr Kenneth Chen Koon Lap asked the Minister for Communications, in view of the deteriorating economic crisis, if the Minister will consider suspending the implementation of the Electronic Road Pricing system to the Central Business District for a period of 12 months.

Mr Mah Bow Tan: The ERP system is a traffic management tool. It is not to generate revenue. Its primary purpose is to bring about a smoother flow of traffic, and more efficient use of our road network so as to support economic activities and to maintain a clean and safe environment.

ERP is a major component of the Government's traffic management policy, which emphasises usage rather than ownership restraint. Part of this policy has already been implemented this year in the form of major vehicle tax reductions and ERP rebates. For example, an average 1600 cc car will pay about $440 less in taxes due to the road tax reduction of $240 and ERP road tax rebate of $200. An average heavy goods vehicle will save about $580 in annual road tax due to the road tax reduction of $280 and ERP road tax rebate of $300. In addition, the Registration Fee for new heavy goods vehicles was reduced from $14,000 to $140. The overall package will cost the Government about $1 billion over 5 years.

The majority or 76% of motorists who do not use the ERP will enjoy the full savings. 15% of motorists who make only one ERP pass per day will also save as the rates are no more than their previous ALS/RPS charges. In fact, we have introduced lower ERP rates on the expressways to spread out traffic to the shoulder periods when traffic volume is lower. For the CBD, we have lowered ERP rates generally and shortened the ERP hours on Saturday.

The rest of the motorists who make more than one ERP pass per day will have to plan their trips carefully and adjust their travel patterns to minimise their ERP cost. Some businesses will need time to adjust to ERP. Hence, we decided to phase-in the ERP charges for commercial vehicles and taxis over the next 4 years.

The ERP system is a fairer and more equitable system than the previous manual ALS and RPS. It is part of our revised traffic management policy, which reduces the cost of motoring for those who choose to make less use of our roads and help keep traffic free-flowing. As such, my Ministry will not suspend the implementation of the ERP on the CBD. However, we will monitor the traffic conditions and adjust the rates to ensure that motorists are not charged more than is necessary to keep traffic free flowing on our roads.