How it began
The practical application of road pricing started in Singapore in June 1975 with the Area Licensing Scheme. It covered all roads entering a Restricted Zone of about 6 square kilometers in the Central Business District. Drivers entering between 7:30 and 9:30 in the morning, except on Sundays and public holidays, had to hold a licence that cost 3 Singapore dollars a day.
How it works
Drivers bought a paper licence in advance, by the day or the month, at post offices, petrol stations, sales booths or convenience stores, and displayed it on the windscreen or, for motorcycles, on the handlebars. Licences differed in shape by vehicle class and changed color each month to deter fraud. Officers at 28 overhead gantries on the zone boundary watched passing vehicles without stopping them and noted the plates of violators, who were fined from 50 Singapore dollars.
How it spread
The scheme was adjusted many times. The fee rose to 5 dollars in 1980 and returned to 3 dollars in 1989, when evening peak hours were added. In 1994 it was extended to the whole day, which brought an immediate 9.3 percent drop in traffic in and out of the zone. The zone grew to 7.25 square kilometers. Later schemes elsewhere, such as the London congestion charge, were based on it.
What changed first
Traffic entering the zone in the morning charging hours fell from 32,500 vehicles to 7,700, a drop of 76 percent. Nine percent of users switched to public transport. The share of work trips into the zone made by public transport rose from 33 percent before the scheme to about 70 percent by 1983. Growth of the vehicle fleet slowed from 6 percent a year to 4 percent.
Where it stands today
The paper licence system ended in September 1998, when it was replaced by Electronic Road Pricing, which charges vehicles automatically. Road pricing has remained in continuous use in Singapore since 1975, and economists have studied its 28-year evolution from manual licences to electronic charging as a leading example of congestion pricing.
