Tolls needn’t hurt the poor

Opponents of highway tolls received fresh fuel for their views this past week with a report indicating that such charges would penalize low-income commuters. But that rather obvious conclusion doesn’t mean road pricing should be dropped as a revenue tool.

On the contrary, when it comes to funding public transit and reducing highway gridlock, tolls remain a fair and justifiable option.

Concern about lower-income commuters surfaced in a federal briefing note prepared for deputy finance minister Paul Rochon in February and obtained by The Canadian Press through the access to information process. The internal analysis found that, while higher income people are heavier users of road infrastructure, three-quarters of the less-well-off still rely on the road network and therefore could be hit by tolls.

Authors of the document noted that 77 per cent of taxpayers in the bottom fifth of income earners took their private vehicles to work. These “lower income people still rely heavily on road infrastructure.” As reported by The Canadian Press’s Andy Blatchford, the report concluded that tolls are a “regressive” revenue tool because all drivers — rich and poor alike — are typically stuck with the same fee, regardless of their capacity to pay. The burden of this imbalance is “especially acute in regions where there are fewer substitute methods of transportation.”

In the past, critics of highway tolling have raised similar social equity concerns over the impact of road pricing. But the issue is more complicated than it might appear at first glance.

For a start, the situation of “lower income” commuters isn’t quite the same matter as the plight of the poor. Truly impoverished Canadians can’t afford to drive a car. Many are retired or jobless. And those who do work are often employed locally, meaning they don’t have to travel on highways where tolls might be encountered.

Motorists who routinely commute on highways aren’t necessarily rich, but it’s safe to say the vast majority aren’t at the bottom of the economic ladder. The very poor are far more likely to rely on public transit, and road tolls offer a promising way to fund more of this badly needed urban infrastructure.

Indeed, highway pricing delivers a dual benefit. It’s a way of potentially raising hundreds of millions of dollars for transit each year, depending on the nature and location of tolling systems. And it eases gridlock by convincing more drivers to leave their vehicle at home and opt instead for alternatives such as car pooling, telecommuting or riding transit.

It’s true that a massive expansion of public transit could also be funded through increased income tax — more progressive than a road toll since low income people pay less than the affluent. But that would do nothing to cut automobile dependency and reduce gridlock.

It’s worth noting that motorists typically have the option of steering clear of a road charge. Highway pricing systems discussed in Ontario would still leave toll-free routes available for drivers who can’t pay a road fee or simply prefer to avoid one.

The province, for example, is setting up high-occupancy toll routes on the Queen Elizabeth Way starting on Sept. 15. For $60 a month these would grant drivers the privilege of travelling solo in existing HOV lanes.

Regular highway lanes would still be available free of charge, so there’s no extra burden imposed on the poor. Indeed, lower income commuters on the QEW might see a small reduction in their rush-hour drive time as more affluent motorists get out of their way by opting for the toll lane.

Any lingering equity concerns from tolling could be addressed through some form of discount or rebate for low-income drivers. A useful model might be Canada’s GST/HST credit, which helps people with low or modest incomes offset the sales and service tax they pay.

The bottom line is that road pricing doesn’t have to pose a huge problem for the poor. Concern for low-income people shouldn’t be used as an argument against tolling systems that could simultaneously boost public transit and cut gridlock.

Those outcomes work to everyone’s benefit — rich and poor alike.

It’s safe to say the vast majority of people who use the highway to commute aren’t at the bottom of the economic ladder