The objectives of this project are:

• to undertake new case study research to address gaps in the existing level of knowledge of marginal social costs in road and rail transport – particular attention will be given to specific aspects, namely infrastructure wear and tear, road congestion, rail scarcity costs, accidents, air pollution and global warming, noise nuisance and environmental costs in sensitive areas .
• to undertake new case study research to address gaps in the existing level of knowledge of marginal social costs in air and water borne transport – particular attention will be given to all cost categories;
• to develop and refine the methods of using transport accounts to monitor the implementation of transport pricing reform in an enlarged Europe – in particular to apply results from the WP1 case studies to split between fixed and variable costs, to close gaps in the accounts, especially for air transport and waterborne transport and to provide qualitative and quantitative inputs for the generalisation of marginal cost case studies (cost drivers);
• to undertake innovative research on the issue of the appropriate degree of complexity in transport charges, to provide guidance on the effective trade off between pricing systems that give appropriate incentives by portraying variations in marginal social cost in time and space in detail and pricing systems that are easily understood and acted upon.
• to provide clear guidance on the marginal social cost of the different modes of transport in specific circumstances and on simple and transparent methods for determining charges - this will involve bringing together results of previous research on costs, cost drivers and cost functions and the production of a software tool designed to enable derivation of costs and charges even in situations where detailed analysis does not exist.
• to refine the use of models to address the broad socio-economic impacts of pricing reform – particular attention will be given to modal shares, accidents, sensitive areas, regional economics and equity issues.
• to draw clear conclusions and recommendations for policy and for research in the field of transport infrastructure costs and charges.

These objectives will be pursued within a set of seven inter-related workpackages, one per objective, each lead by internationally recognised experts in the field and involving a highly experienced team. In addition, there will be a workpackage dedicated to project management.

The achievement of the first two of the above objectives is linked to the production of Deliverable Three – Marginal cost case studies for road and rail transport - and Deliverable Four – Marginal cost case studies for air and water transport – which are scheduled for production in month 15 of the project. Achievement of the third objective is linked to production of Deliverable Five – Monitoring pricing policy using accounts – which is scheduled for completion in month 21 of the project. Objective four is linked to the production of Deliverable Six – Optimal complexity of transport pricing – which is also scheduled for month 21 of the project. The fifth objective is linked both with the production of Deliverable Seven – Generalisation of marginal social cost estimates – and Deliverable Eight - the accompanying software tool - which are both scheduled for completion in month 24 of the project. Achievement of the sixth of the seven objectives is associated with production of Deliverable Nine – the Socio-economic impacts of transport pricing reforms – which is also scheduled for completion in month 24 of the project. Finally, achievement of the seventh and final of the project objectives is associated with production of Deliverable Ten – Policy conclusions on marginal social cost pricing – which is scheduled for completion in month 30 of the project. Each work package has intermediate milestones en route to the achievement of each objective which are set out in section 7 below, and two of the work packages have intermediate deliverables.

Two related proposals were also submitted by consortia with membership that overlaps with this one. These are a STREP on pricing and investment and a coordination action on the methods to be used in setting tariffs for the use of transport infrastructure. We see these three projects as a cluster which will enjoy considerable synergy by working closely together. We gave specific consideration to this in preparing the proposal for this project, and would seek to achieve a close working relationship with whoever undertakes the two related projects if they are funded.