MOTORISTS have labelled car policy here "pay and pay".

But the Transport Ministry folks disagree, naturally.

They say that, behind the scenes, there is hard thinking to soften the impact of unpopular rate hikes.

The outcome, as they see it, is less "pay and pay" than a menu of options from which commuters are free to pick and choose.

As an example, the policymakers cited the changes they made ahead of this August's notice that Electronic Road Pricing (ERP) operating hours would soon expand.

These hours are now stretched on the city-bound Central Expressway (CTE), before the Braddell exit.

New gantries have also risen along the CTE, East Coast Parkway and Bukit Timah Expressway.

But first, the officials tried to get a handle on people's main concern: If they tossed their car keys out in favour of public transport, could they still enter the city in time for work?

In response, the Land Transport Authority (LTA) worked with the Public Transport Council to relax the rules on premium buses.

By the time the ERP changes were flagged in August, 36 premium bus services were ready to offer direct, fast rides into the city from various parts of the island.

At the same time, the peak-hour frequencies of basic bus services were cut from 15 to 10 minutes.

To help bus passengers beat congestion, the operating hours for bus lanes were extended. More full-day bus lanes were rolled out too.

Policy in flux

IN CASH-RICH, land-poor Singapore, cars are dream assets that the Government will neither deny nor encourage.

The story of Singapore-style car ownership and usage is riddled with conflicting demands and calibrated trade-offs.

Transport Minister Raymond Lim pinpoints the central dilemma: "If you want more cars on the road, and at the same time you want smooth-flowing traffic, then invariably ERP rates will go higher and the coverage will be more extensive."

Car policy is also a story of the COE and ERP, two sides of the policy coin.

The COE, or certificate of entitlement, is very much a settled policy (See Page S4). It is a solution, unique to Singapore, for fixing car quotas, with the market determining COE prices.

ERP, or Electronic Road Pricing, has an established lineage; it was birthed from the world-first Area Licensing Scheme (ALS) in 1975. So road pricing is familiar to all and younger people were born with it in place, but it remains a policy in flux.

This comes across clearly in the way that planners are still keen to explain the trade-off between having more cars and paying higher ERP rates.

"In fact, we use ERP as a last line," Transport Minister Lim says. "We tried traffic engineering possibilities first - expand roads, widen them - before introducing the congestion charge."

The ERP may be a last line of action, but Singapore is the first country to have it city-wide.

Other cities watched, sceptical, but London and Stockholm have now embraced it.

The LTA's group director of policy and planning, Mr Lew Yii Der, says: "ERP is the right congestion management tool that every city around the world is beginning to wake up to."

ERP rates can move up or down by 50 cents every quarter to keep traffic flowing at 45kmh to 65kmh on expressways. On arterial roads, the optimum speed is 20 to 30 kmh.

The LTA uses this measure of speed to apply its judgment on equitable ERP rates.

The LTA says that each time the rates move, its data proves that road speeds generally return to the optimum boundaries.

The link between speed and traffic flow is unique to a city. "It depends on the road network, our rules and how our motorists behave when they drive," Mr Lew says.

Along the way, the ERP continues to be fine-tuned. One major adjustment involved the evening ERP.

Evening jam

MR YEO Cheow Tong, who was transport minister from November 2001 to May last year, recalls some of the debate surrounding the evening ERP.

This was prompted by severe evening congestion. The CTE resembled a carpark in stretches.

A couple of years were spent deliberating it, with hints of what was to come appearing around 2000.

Mr Yeo says people were asking: "Why should you impose evening ERP just to make our travel faster, because we're quite happy, we're not rushing anywhere?"

Within official circles, this point was also debated.

Over time, a consensus formed. Summarising, he says: "A road is an expensive economic asset." People need a choice of whether to pay evening ERP for smoother traffic, for instance, if they are rushing for the evening shift.

But the ERP still invites dissension easily.

MP Michael Palmer says: "You up the prices, it doesn't work. It's still a jam, what's going on?"

Transport Minister Lim is familiar with such sentiments and says the Land Transport Review, expected next month, is tackling the issue after weighing public input.

He, too, lists the litany of public complaints: higher rates simply shift congestion to other roads, hikes work for just a while and so on.

"All these are valid points," he says. "As a direct result of this public input, one of the key agenda items of this Land Transport Review is: How do we make the ERP system more effective?"

Road pricing will always be in flux, both by design and otherwise, since external factors such as the economy also affect road use.

First, the ERP was created as a flexible tool. The LTA constantly tracks road use. Most cabs are fitted with the global positioning system (GPS) so data on their movements is tapped as a proxy for average road speeds. Cameras and observers in cars and on roads also pull data for analysis.

Next, many factors change road usage: school holidays, a rip-roaring economy, petrol prices. The opening of the integrated resorts will again reshape road use patterns.

In that sense, the ERP is a tool intended to change in dynamic tandem with what is happening on and off the roads.

The ERP has come into extra prominence since 1998, when planners shifted from a tax regime focused on car ownership to one concentrating on car usage.

The turning point occurred when policymakers decided that a more balanced approach was needed, what with Singaporeans chalking up more intensive mileage than many other nations.

The 1996 White Paper showed that the average mileage of a car here was 18,600 km a year. This trumps usage in the United States, Britain, Japan and France.

Last year, the average car mileage even rose 2.5 per cent to 21,075km per year. That means more congestion to tame.

"It's the congestion that we want to tackle, not really the ownership," says Mr Lew. "There's no reason why we want to continually impose very high taxes on people."

For a driver last year, the cost of owning a car was about 57 per cent of his total bill. His usage costs made up the remaining 43 per cent.

Ownership costs include upfront costs, like the Open Market Value and COE, plus annual fixed costs, such as road tax and insurance.

Usage costs include fuel, parking and ERP.

The shift to usage charges has brought on another big balancing act. Mr Lew adds:

"We realised that we really need a balance of both ownership and usage measures because, once someone owns a car, he wants to use it regardless of the cost of using it."

The trick is to get the balance right.

No one has easy answers and transport policy expert Paul Barter of the Lee Kuan Yew School of Public Policy has flipped sides himself:

"I used to think I knew, and I used to think the answer was usage-based pricing."

But there must be enough focus on ownership controls, he says. He does some quick mathematics:

"Once people buy a car, they have every incentive to use it a lot. If you leave it at home, the car is depreciating $20 a day, some $10 and $30 a day, depending on the car." People rationalise that since they have splurged on a car, they will drive it. They'll wonder why they should ride the MRT. "Unless there is a really strong disincentive, like it's impossible to park or the ERP is huge," he says.

It's unpopular, but new, clever ways to dissuade people from owning cars and also to drive in moderation are likely to be sought.

One idea that fits these twin objectives may be distance-based COEs, which gives buyers the right to drive a certain number of kilometres. Prof Barter champions this instead of the 10-year COE.

Officials haven't taken their eyes off car ownership either. The 3 per cent annual rise in car population was set in 1990, when vehicle quotas were introduced. The rate will be reviewed next year.

Political capital

BUT the Singapore Government does not waver from unpopular choices. It does consult and does try to sell, but the principle stays: Is the policy sound?

It is prepared to spend its political capital. Mr Lim says:

"We take a long-term view of the problem and not the short-term view that is heavily influenced by the political business. We don't do that."

He has met US policymakers, who "applauded" when the ALS was introduced in 1975. "Transport planners know that this is the way to go: congestion charging. But the political will, they say, was never there," he says.

"So if you go to Los Angeles, you get yourself caught in a gridlock."

The trade-off there is freedom of choice. The cost is economic wastage for the individual and the city.

But it is still the onus of planners to offer transport solutions and to sell policies well. In the case of the ERP, selling has ranged from explaining the options in an "upfront and honest" way, as Mr Lim sees it, to the fun of an e-game where people play at being the transport minister.

One person who played the game recently is Mr Septo Sutedja, 26, an IT worker. He drives and takes public transport on different days.

The Indonesian, who has lived here since 1999, says the game showed him that trade-offs are made all the time and inputs are weighed.

"Making policy is not very simple: close eyes, toss coin," he says.

On a lighter note, Mr Lim says: "We hope the game is fun... and hopefully you have a sense of the complexity of issues and the trade-offs."

He quips: "Of course, I've always said if anybody wants to do it for more than a day, they're welcome to be Transport Minister."