Values of Travel Time: Where do they come from, and where are they going?

THE VALUE OF TIME is a regular topic on the agenda of the Joint Analysis Development Panel, an advisory group to the Department for Transport on which I have served since 2015. And that’s hardly surprising, as the value of time (VOT), and the value of trave time savings (VTTS) feature large in both transport modelling and appraisal. I understand, incidentally, that DfT is leaning towards standardising on using the single term Value of Travel Time (VTT), which I will use throughout the rest of this text.

Travel time savings are also one of the most contentious issues in appraisal – for example, many practitioners query the value of small time benefits to travellers that our models predict, or whether travel time savings should feature in appraisal at all.

In response to the matter of how they are used, the Welsh government in its revised WelTAG guidance introduced two years ago has stipulated that when all business cases are prepared the BCRs should be presented both including and excluding travel time related benefits. Indeed, as far as I am concerned, it should not be impossible to always present travel time savings and associated benefits in a way that reflects their distribution, from very small to very large values.

Much effort goes into the estimation the value of travel time; a rich international literature exists. And successive estimates of these values, from new surveys, and enhanced approaches to their estimation, can lead to substantial changes in their model and appraisal values, whereas the real world stays very much the same.

Take the 2017 update to values of time in the DfT Transport Appraisal Guidance (TAG) Databook based on a 2015 survey by ITS Leeds and others (see for example Batley, R., Bates, J., Bliemer, M. et al. New appraisal values of travel time saving and reliability in Great Britain. Transportation 46, 583–621 (2019), and Department for Transport Understanding and Valuing Impacts of Transport Investment – Value of travel time savings, October 2015). Full links to references at end of article.

The consequent changes in the TAG Databook from this update were considerable. The values of travel time were increased by around 50% in value for commuting, but reduced by around 25% for other non-business travel, relative to previous TAG guidance. The adjustment in values of time for business travel was more complex; for trips of less than 20 miles, values are now around 75% lower than previous TAG values; for trips of around 100 miles these values are comparable to previous TAG values; and for longer trips still, they exceed those used previously in TAG.

Most recently work on the values to be applied to freight traffic was big news in LTT and among transport professionals with Graham James producing a valuable and timely assessment of background and prospective significant consequences which is now available on TAPAS.

These recent updates to the freight values of time resulted in Heavy Goods Vehicle values increasing by a factor of 3; and Light Goods Vehicles values for travel in work mode by about a quarter. These are set out in full in the TAG publication Understanding and Valuing Road Freight Travel Time.

As a result of the changes, values of travel time for business and freight trips remain high; so that it is not surprising that for many road schemes the travel time benefits experienced by business travellers and freight movements exceed those for any of the other purposes, and shape the appraisal outcomes accordingly.

Why is all this important? In many business cases, and not just for road schemes, travel time savings remain the largest contributors to monetised scheme benefits. Changes in the values of travel time and travel time savings will obviously affect the absolute values for many road projects, and hence their value for money, and potentially also their ranking in competition with other schemes, for example local projects that benefit freight movements less, or in comparison with other modes.

These changes in values of travel time do not just affect appraisal; they also have a potential impact on models and the way in which VTTs are operationalised in them. Following the 2017 TAG updates many transport models in the UK were re calibrated in terms of their relative values of time (VOTs) and values of operating costs (VOCs), at a substantial cost.

Now it can be argued that the TAG values are appraisal values rather than modelling values, and that therefore the model values (in other words the perceived values of travel time by travellers) should not change: it’s only the appraisal values that need to be adjusted following updates to the TAG databook.

Having said that, this begs the fundamental question whether the values of travel time in the TAG databook, obtained, after all, by willingness-to-pay surveys, do actually reflect perceived (model) values or societal (appraisal) values?

An interesting article on participatory value evaluation (PVE) that reflected on this, was written in 2021 by researchers Mouter, Koster and Dekker Contrasting the recommendations of participatory value evaluation and cost-benefit. The authors compared how people respond to questions about the importance of travel time savings when asked to respond selfishly (in other words how they themselves would value time when making travel decisions) compared to when they put a more societal hat on, reflecting how they felt the government should invest in terms of saving travel time compared to other potential objectives and benefits. They concluded “that projects rank differently in a cost benefit analysis and participatory value evaluation in the sense that projects which focus on improving traffic safety and improvements for cyclists and pedestrians rank higher in a PVE than in a CBA, whereas car projects rank higher in a CBA.”

Their latter estimations could be viewed as societal values of travel time and the former ones as selfish or perceived values. In that interpretation, the values in the TAG data book, obtained by willingness to pay surveys, are best interpreted as ‘perceived’ values of travel time rather than ‘societal’ values, so that it was correct to adjust models in the wake of the 2017 values of travel time changes in TAG.

The appraisal values that emerge can then be adjusted more freely, either by a similar PVE exercise to that carried out in the Netherlands, or by introducing distributional weights reflecting local policies and political preferences, something already being investigated by the Department for Transport in its publication on Distributional impact appraisal audit.

If the model’s values of time differ considerably from appraisal values, it is of course possible that interventions that in a model give rise to substantial travel time benefits, may in appraisal show much less impact. I would expect this to be rare, but not impossible, in theory, and in real life, also. The Braess paradox has been used as an example of what would appear to be a positive intervention leading to network conditions and increased overall travel times. See the article in Transportation Science, 2005: On a Paradox of Traffic Planning.

One way to avoid this from happening would be to test the range of differences between perceived and societal values of time so that these anomalies don’t occur (in general or in specific applications) while still allowing both modellers and economists an amount of freedom in the setting of the local values of travel time that are appropriate to their own tasks. Of course, this should not absolve the analysts from ensuring these are empirically based, on observed data.

So the key question here to thus address becomes: whose travel time is it anyway? Because that matters. And what can we as practitioners, and the Department for Transport in their guidance, do about it?

My conclusions

Let me make some suggestions:

• Travel time savings, and even small travel time savings should continue to feature in appraisal. They are the currency and the mechanism that enables people faced with future choices to enjoy their direct value, or trade them for other behavioural responses that are not captured in our models. And if people are concerned about them distorting decision-making, this only happens if the BCR is the main consideration for decision-making (something that the Treasury’s Green Book Review earlier this year explicitly called out. It’s not the analysts that are at fault, but those using their analyses. Nothing stops us from more carefully presenting and not ignoring the distribution of all travel time savings that the model calculates: their size, where they occur and who the winners and losers are.

• The Department for Transport should strengthen their guidance in TAG on what the VTTs in the TAG databook reflect – whose values of travel time they are. If (as I believe) they are perceived values, for use in modelling, practitioners have less leeway in estimating their own values of travel time, for example in route choice models; but in appraisal there would be more space to manoeuvre. Alternatively, if these are values to be used in appraisal, then the guidance in TAG Unit M3.1 should provide more freedom to modellers to adjust these locally, potentially adding another degree of freedom in calibration.

• Following this argument through, VTT values do not have to be the same in modelling and appraisal. This may potentially lead to anomalous situations, appraisal outcomes not mirroring what modelled responses suggested. But it is exactly what transport models need to reflect: how people will most likely respond to an intervention, rather than how we would like them to, as transport planners. As someone observed in a recent meeting: appraisal is about valuing and presenting welfare impacts, not to make the world a better place – that’s what we elect MPs for.

• I would like the VTT values in the TAG databook to be more disaggregated by mode and purpose, and potentially location and person characteristics. These are already presented in much greater detail for employers business trips than for any of the other purposes, so the surveys should in principle support this. A recent scoping study for updating the values of travel time again (reflecting the post-COVID reality) was carried out for DfT by ITS Leeds and others, Scoping the value of travel time and value of travel time reliability; It would be a shame if future VTT changes in the TAG databook were to miss the opportunity to collect and present them for use in more detail than is current common practice.

I understand that the Department for Transport is in the process of updating its TAG guidance for the Senior Responsible Officers and Technical Project Managers, with the aim of making it more accessible and better used.

This is an ideal opportunity to explain the freedom that exists in principle in setting local values of travel time, both in modelling and in appraisal, so that decision-makers have greater confidence in using the experts’ analysis to inform rather than constrain their judgments. This would reflect the intentions of the recent Treasury Green Book review in putting the BCR metrics in proper context, by clearly presenting the workings, assumptions and implications of alternative approaches to estimating and weighting values of travel time in conclusions and recommendations put to decision-makers, as the Welsh guidance has begun to expect.

References and Links

• Welsh transport appraisal guidance (WelTAG) | GOV.WALES https://www.gov.wales/welsh-transport-appraisal-guidance-weltag

• Batley, R., Bates, J., Bliemer, M. et al. New appraisal values of travel time saving and reliability in Great Britain. Transportation 46, 583–621, 2019 https://link.springer.com/article/10.1007/s11116-017-9798-7

• Department for Transport Understanding and Valuing Impacts of Transport Investment – Value of travel time savings, October 2015 https://assets.publishing.service.gov.uk/media/5a7f2325e5274a2e8ab4a577/Understanding_and_Valuing_Impacts_of_Transport_Investment.pdf

• https://www.gov.uk/government/publications/understanding-and-valuing-road-freight-travel-time

• Contrasting the recommendations of participatory value evaluation and cost-benefit Mouter, Koster and Dekker, 2021. https://assets.publishing.service.gov.uk/media/5a7f2325e5274a2e8ab4a577/Understanding_and_Valuing_Impacts_of_Transport_Investment.pdf

• https://www.gov.uk/government/publications/distributional-impact-appraisal-audit

• On a Paradox of Traffic Planning, Volume 12, pages 258–268, 1968. https://homepage.rub.de/Dietrich.Braess/Paradox-BNW.pdf

• Green Book Review 2025: Findings and actions - GOV.UK. https://www.gov.uk/government/publications/green-book-review-2025-findings-and-actions/green-book-review-2025-findings-and-actions

• https://www.gov.uk/government/publications/scoping-the-value-of-travel-time-and-value-of-travel-time-reliability