London residents are underpaying for parking permits

By Joe Wills | 18 March 2020

Anyone connected with local government appreciates the sensitivity around parking. Mindful of how emotive the issue can become, councils can often be risk averse when considering kerbside policy. Nonetheless, if councils are truly committed to combatting climate change, then facilitating mode shift should be a central part of their action plans.

Road transport makes up around a fifth of the UK’s greenhouse gas emissions, and as such, changing people’s mode of travel and reducing the number of car journeys taken in each area will play a key role in reaching net zero.

Parking policy has a role to play in this, as the availability and cost of parking can influence how likely people are to own and use cars. And it’s not just the direct cost and availability of parking which impacts on mode choice. Accommodating parked cars on the kerbside also has an opportunity cost, by denying space to other activities which also require using the kerb. Improving the speed and reliability of buses for example, which is key to encouraging people to switch to public transport, requires more priority bus lanes. This is much harder to do if large stretches of the kerb are given over to cars. The same applies for efficient loading and deliveries for businesses, as well as access for disabled parking, or even planting more street trees and benches.

So, given the value of parking space in light of these considerations, how should the cost of parking permits be determined?

It is worth exploring how the price of parking permits in London relates to their costs, given that highways have maintenance costs, as well as the back office and enforcement staff required to operate controlled parking schemes. Usually only the enforcement costs are itemised as parking expenditure. We calculated what a reasonable approximation of back office and maintenance costs would be per parking space and included this in our calculations as well. Our research found that, on average, the operating cost per parking space exceeds what residents are paying for them. For inner London, the estimated yearly operating cost of a parking space is £336. In comparison, the maximum that residents will pay for a parking permit on average is £230. For outer London, the estimated operating cost is £295, and the maximum permit price is £154. 

In many boroughs, the majority of parking revenue comes from short-stay parking charges as well as penalty charge notices. So, these are actually cross-subsidising residential parking permits. What this means is that revenue that could go towards the infrastructure that would enable people to do without cars, without being overly punitive, is going towards operating parking spaces instead. As such, we are calling for residential parking permits to at least meet their own costs of operation, and any resulting surplus to go towards supporting mode shift.

For the boroughs which are already well served by public transport alternatives, and where car-owners are in a minority, like most of the inner London boroughs, this will be an easier sell. In places less well-served by public transport, and where there are higher levels of car ownership, we understand that it may be more challenging. However, it is precisely those places which will benefit the most from providing enabling transport infrastructure, and where this revenue would count the most.

We think that asking people to pay their way, so that private use of a public space won’t actually cost councils money is a reasonable approach, especially given the huge costs to all of us in the face of inaction against climate change.

Joe Wills is senior researcher at the Centre for London

Reclaim the kerb: The future of parking and kerbside management in London

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