TRANSPORT LAW ENFORCEMENT: A FRAMEWORK FOR THE OPTIMISATION OF

ECONOMIC BENEFITS

Dr. MARK BROWN – HALCROW, UK

ETC 2006 STRASBOURG

Contents of presentation

• Context and issues• An economic model of enforcement and deterrence• Case studies: speeding, bus lanes, congestion charging• Conclusions

THE ISSUES

• Sophisticated traffic management measures rely increasingly on enforcement

• Traffic management measures can be expensive…

• …but poorly enforced (Large numbers of traffic offences - 6 Million road traffic offences in UK; estimated 50%+ of motorists break speed limits)

• Enforcement itself is expensive - estimated £3Bn/yr on policing transport

• Government(s) calling for ‘evidence based policy’ to justify expenditure

A RATIONAL APPROACH TO TRAFFIC LAW ENFORCEMENT

• Can Enforcement activities be used to improve efficiency of transport system?

• If so, how should efficient enforcement resources be allocated?

• How can performance of different enforcement programmes be measured and evaluated

• How should economic principles determine the optimal levels of resource allocation

AN ECONOMIC APPROACH TO ENFORCEMENT

• How much should we spend/invest in enforcement?

• What type of benefits can we expect?

• What is the efficient level of offending?

• How many offences should be permitted and how many deterred or apprehended?

• How can enforcement bodies use such rational principles in practice?

THE OPTIMAL LEVEL OF ENFORCEMENT

Number of Offences per year

Social Cost

£m/yr

Enforcement Effort

High

Enforcement

Cost

High Damage Cost –

too many offences

Optima The ideal

No. offences!

ENFORCEMENT ISSUES

• Need to accept key objectives of minimising social cost (cost of enforcement + cost of damage resulting from offending)

• Potential for some de-criminalisation

• Public acceptability

• Strategic enforcement decisions

• Local enforcement decisions

BECKER’S ENFORCEMENT FRAMEWORK

• Social cost of enforcement

• Cost of prosecution and punishment

• Social damage cost of harm due to offences

• Gain to offenders from their actions

• Relative effects of changes in the certainty and severity of punishment

• Quantification of the demand function in order to forecast the supply of offences

How many traffic offences should be permitted?

ENFORCEMENT AND DETTERENCE MODELS

COST OF

ENFORCEMENT,

PROSECUCTION

AND PUNISHMENT

COST OF

DAMAGE TO

SOCIETY

GAIN TO

OFFENDERS

SOCIAL

COST+ + =

NUMBER OF OFFENCES

CERTAINTY OF

CONVICTIONSEVERITY OF

PUNISHMENT

Gain to offenders?

• A valid economic benefit – illegal parking, goods vehicle overloading, speeding, etc

• A useful modelling concept, in that the optimum conditions are:

Gain (O`) = Social Damage (SD`) = deterrence (p.f)

Deterrence Model

Select the appropriate policy weapon….… In simple terms:

P * f = deterrence = disutility of offending

Where:P = certainty of sanctionsF = severity of sanctions

With potential for added degrees of complexity:

[P * (f + E)] + N = deterrence

Where:E = informal costs of apprehensionN = loss of legitimate income

CASE STUDIES

• Speed cameras• Bus lane enforcement• Congestion charging

Worked example 1 – speed cameras

• Example is for road with 20 camera sites

• Issue is how many should be loaded with film

• Enforcement and prosecution costs known

• Main social damage cost is accidents – which can be predicted

Deterrence effects – proportion of current offenders who would still offend

85%84%80.5%78%71.5%47.5%21.5%£60 + 3 penalty points

75%74%71%68%62%40%18%£80 + 3 penalty points

95%94%90%88%81%55%25%£40 + 3 penalty points

1 in 201 in 161 in 101 in 81 in 51 in 21 in 1Fine

Number of cameras in operation

Reduction in offences and accidents

£35£37£46£53£71£154£304Reduction in accident cost (’000)

£1,919£1,916£1,907£1,901£1,883£1,800£1,650Annual accident cost (’000)

98%98%98%97%96%92%84%% accidents still occur (Pγ)

85%84%80.5%78%70.5%47.5%21.5%% still offending (P)

1 in 201 in 161 in 101 in 81 in 51 in 21 in 1

Number of cameras in operation

Data for £60 penalty

Costs & benefits of speed cameras

525877121204240Net finance+Social benefit

-27-40-72-90-143-234-157Net social benefits

£35£37£46£53£71£154£304Social benefit (accidents)

-£78-£97-£149-£180-£264-£438-£397Minimum offenders impact

£17£21£31£37£50£50-£64Total for enforcement institutions

£78£97£149£180£264£438£397Penalty revenue

-£52-£64-£98-£118-£174-£288-£261Prosecution cost

-£10-£12.5-£20-£25-£40-£100-£200Enforcement cost

Recurrent costs and benefits

1 in 201 in 161 in 101 in 81 in 51 in 21 in 1Change in impact

Number of cameras in operation (ie: no. with film)

90

What the analysis tells us

• Largest impact on accidents from 1:1 operable• Best cost (revenue) recovery from 1:2 or 1:5 operable• Minimal social costs from 1:20• Best cost recovery and highest social benefit from

1:1• If accident costs weighted at 1.66, 1:1 operable

optimal, social costs & financial (eg: due to policy priority)

Example 2 - Bus Lane enforcement

• Issue: how many buses to fit with enforcement cameras

• Costs of enforcement known

• Social damage cost largely that of delay to bus passengers and additional bus operating costs

Bus lane camera enforcement

-£4,200-£5,196-£8,140-£10,067-£15,241-£30,309-£37,237Offenders (lower limit)

£ 12,000 £ 16,000 £ 24,000 £ 28,000 £ 48,000 £120,000 £200,000Wider society

-£6,800 -£8,496 -£ 13,581 -£ 16,969 -£27,089-£67,165-£132,660Enforcement institutions

Summary of impacts by impact group

£12,000 £16,000 £24,000 £28,000£48,000£120,000£200,000 Social benefit of less offending

-£4,200-£5,196-£8,140-£10,067-£15,241-£30,309-£37,237Benefits to offenders lower limit)

£4,200£5,196£8,140£10,067£15,241£30,309£37,237Fine Revenue

-£4,500 -£5,567 -£8,722 -£10,786-£16,330-£32,474 -£39,897 Cost of punishment

-£6,500 -£8,125 -£13,000 -£16,250-£26,000-£65,000 -£130,000 Cost of enforcement

1 in 201 in 161 in 101 in 81 in 51 in 21 in 1

Proportion of buses with cameras

Conclusions from bus lane enforcement analysis

• Social benefits maximised by 1 camera per bus

• If social costs to offenders considered, optima becomes 1:16

• Financial impact on enforcement institutions consistently poor and proportionate to level of enforcement

Example 3 - Congestion charging cameras

39%50%

18.75%80%

16.95%82.7%

12%90%

Proportion continuing to offend

Probability of detection

Addition of one more

mobile camera site –

Increases chances of

Detection from 80% to

82.7%

Congestion charging

Economics:• Cost of additional camera £300,000/year• 1,310 fewer offences/day detected save £460,000/year in

prosecution costs• Congestion saving valued at £3.6m/year• = Large net social benefit (£3.76m)

Finance:• 1,310 fewer offences detected also reduces fine income by

£11m/year• = large financial loss (£11.160m)

Implications of case studies

Optimise: social cost finance policy issues

Speed cameras fewer more policy weights?Bus lane cameras more fewer PT strategy?Cong charging more fewer affordability?

Conclusions from case study analysis

• Be clear about objectives – economic or financial + treatment of gain to offenders

• Enforcement is generally expensive – high levels of policing often fail cost-benefit test

• Other aspects of deterrence (eg: fine) may need to be considered to improve economic performance

• Financial optimum is neither that which maximises social benefits nor minimises social costs

CONCLUSIONS

• An economic approach will improve resource allocation decisions

• It will identify the true social cost of offences

• It will also help to target enforcement activities and measure their performance

• It can assist at a strategic level – setting budgets for enforcement bodies

• It can also help design local enforcement programmes

• It supports ‘best value’, ‘evidence based’ and ‘value for money’ programmes

The End

The ideal level of enforcement is generally >0% but <100% - economics helps us define the optimum

Thank-you for your attention