Financial incentives removed from parking contract

Councillor Steve Reed, Leader of the London Borough of Lambeth, explains how the authority has tackled the issue of removing financial incentives from its parking scheme.

In 2003, Lambeth Council signed a new contract with its parking contractor, Control Plus. The contract included thresholds that reduced the contractor’s income if specified levels of ticketing were not met.

Arguably, these operated as incentives to issue more tickets.  Appeals against unfair tickets shot up by 71 per cent in a matter of weeks. The press was full of lurid stories about over zealous ticketing and claims that parking attendants were under pressure to meet targets and maximise the contractor’s income. 

By the time of the council elections in May, parking had become a key is in several marginal wards. All the political parties offered new approaches to parking enforcement. Our preference was to renegotiate the contract immediately to remove the financial incentives. 

Following our election win, councillors confronted sceptical town hall officers with the unwelcome news that we were serious about renegotiating the contract. Without a precedent, Lambeth’s transport staff were going to have to break new ground.  Following a clear political steer, officers moved fast and completed negotiations within months. 

By October, the council was ready to announce a new contract that would no longer rely on financial incentives. In an attempt to simplify the contract, the 21 areas of activity previously monitored have been reduced to just nine. 

Parking attendants will be monitored by mystery shoppers to ensure they treat motorists with courtesy. An increase in the number of successful appeals will trigger financial penalties. Streets will be monitored to check the frequency of visits by parking attendants and the number of illegally parked cars that are not dealt with. 

The council’s scrutiny function and the deputy cabinet member for transport, will keep a close eye on how the new contract works until its expiry date in 2008. 

Councils derive a significant revenue stream from parking enforcement. This is fine if the service is seen as fair and operating primarily to keep the roads clear of illegally parked traffic. The revenue is used to improve transport facilities, freeing up other resources for spending on priority areas. 

The political problem with Lambeth’s old contract was the perception that it was unfair and operated as a covert tax. Financial incentives drove that concern, so we are keen to see whether their removal improves public confidence. A key indicator will be whether the number of successful appeals falls – implying that fewer unfair tickets are being issued. 

 Beyond that, we are unsure how revenue will be affected. Other councils are looking at increasing parking charges. This is sometimes linked to a green-tax approach that charges gas-guzzling vehicles more. We need to establish whether mystery shoppers are effective in improving customer service, and ultimately how clear the roads are kept of illegally parked vehicles.

However Lambeth’s new parking contract operates, it will offer lessons to other councils seeking to defuse the political time bomb parking enforcement has become.

Councillor Steve Reed (Labour) is Leader of the London Borough of Lambeth. The opinions expressed in this article are those of the author, and do not necessarily reflect those held by the IDeA.

This article was published in November 2006.