Economic Payback of Road Safety Advertising in Northern Ireland October 2012

Transcription

1 Economic Payback Road Safety Advertisg Norrn Irel Ocber 2012 Oxford Economics Abbey House 121 St Aldates Oxford OX1 1HB UK tel: fax:

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3 Economic Payback Road Safety Advertisg NI Contents 1 INTRODUCTION SCOPE OF PROJECT REPORT STRUCTURE ECONOMIC PAYBACK ANALYSIS AND BEST PRACTICE BEST PRACTICE PRINCIPLES OTHER BEST PRACTICE EXAMPLES CRITIQUE OF EXISTING METHODOLOGY AND SCOPE FOR DEVELOPMENT OF METHODOLOGY EXISTING LYLEBAILIE METHODOLOGY AND PAYBACK RESULTS CRITIQUE OF EXISTING METHODOLOGY / SCOPE FOR DEVELOPMENT SUMMARY ENHANCED OXFORD ECONOMICS METHODOLOGY ENHANCED METHODOLOGY STAGES EXPECTED DEATHS AND SERIOUS INJURIES COST PER DEATH/ SERIOUS INJURY WISDOM OF CROWDS AND ECONOMIC PAYBACK OXFORD ECONOMICS ECONOMIC PAYBACK BASED ON ENHANCED METHODOLOGY VALIDATING STATEMENT... 18

4 Economic Payback Road Safety Advertisg NI 1 Introduction Oxford Economics was commissioned Ocber 2012 by LyleBailie International update previous economic payback analysis road safety advertisg NI for period The aim this piece work is develop furr origal methodology applied by LyleBailie. The enhanced Oxford Economics methodology accounts for a wider range facrs impact upon expected road deaths juries reby improves estimation deadweight effect consequently net additional economic payback DOE s road safety campaign. 1.1 Scope project This project covers followg: A brief overview best practice approaches economic payback analysis A critique origal LyleBailie methodology identification as where methodology could be improved le with best practice A detailed description enhanced Oxford Economics approach adopted highlightg consistency with Government appraisal / impact analysis guideles Revised estimate tal economic savg/ payback DOE s road safety advertisg campaign based on enhanced methodology, with results presented for alternate assumption scenarios A validatg statement which can accompany payback analysis relevant publications 1.2 Report structure This report is structured as follows: Chapter 1: Introduction Chapter 2: Discussion economic payback analysis best practice approaches Chapter 3: What has already been done scope for development LyleBailie s existg methodology economic payback result, methodology critique identification as where methodology could be improved Chapter 4: Enhanced Oxford Economics payback methodology buildg on existg LyleBailie approach, this cludes consideration deadweight effects, sensitivity analysis a rigorous assessment key assumptions on economic per death serious jury Chapter 5: Revised Oxford Economics economic payback results results presented for alternate assumption scenarios Chapter 6: Validatg statement which can accompany payback analysis relevant publications

5 Economic Payback Road Safety Advertisg NI 2 Economic payback analysis best practice Economic payback defition: In context this work economic payback is defed as monetary value saved through prevention road deaths serious juries attributable DOE s road safety advertisg campaign, compd public money spent on campaign. It is important note from outset this piece work is not a DTI-type economic efficiency test designed assess impact campaign on regional national economies. 2.1 Best practice prciples Central any economic appraisal / economic impact study is need assess wher project or context this work, road safety advertisg campaign, will brg additional benefits over above what would have happened campaign s absence. i.e. would death jury rates per 10,000 vehicles have fallen at same rate without campaign given changes age prile drivers, average road speeds, urbanisation, creased economic sophistication etc? There is a need assess this deadweight case order avoid over-estimatg net economic payback. There several publications available providg guideles addressg issue additionality cludg HM Treasury Green Book guideles also English Partnership s Additionality Guide. The Green Book refers net benefit any tervention wher it be a government policy or an advertisg campaign as gross benefits less benefits would have occurred absence tervention ( deadweight ) less negative impacts elsewhere (cludg displacement activity), plus multiplier effects. As defed Green Book, deadweight refers outcomes which would have occurred without tervention (i.e. without advertisg campaign). Its scale can be estimated by assessg what would have happened do mimum case, ensurg due allowance is made for or impacts which impact on net additionality such as facrs mentioned above, e.g. changes age prile drivers. In addition it can already be seen from LyleBailie s research re or contribury facrs reducg number road deaths serious juries cludg education, law enforcement etc. which would occur dependently advertisg campaign (Fig 2.1). Figure 2.1 shows entire estimated economic payback savg is correctly attributed a range fluences not just road safety advertisg campaign, although advertisg campaign is estimated have largest dividual fluence.

6 Economic Payback Road Safety Advertisg NI Fig 2.1: NI serious jury / fatality reduction m payback per fluential facr Source: Millward Brown Telephone Survey / Omnibus Base: Approx 1000 respondents per wave (8133 over 8 years) Economic development can also play a role reducg death jury rates. When comparg road deaths NI Lithuania (Lithuania has highest number road deaths per head population Europe), it could be argued richer nations, with higher so called economic sophistication, could also be seen as a contribury facr reducg road deaths serious juries. As NI economy has enjoyed a golden era over last decade, it could be said fallg road death jury rates may be lked this creasg economic prosperity which is not explicitly captured as one fluences Fig 2.1 ( which case economic performance should be facred deadweight effect). However drillg down underst causal effect between economic prosperity road death rates, it is likely richer economies have better roads, more strgent drivg tests ( spend more on se as as y get richer) it is this rar than actual risg prosperity directly fluences road death rates. Therefore current LyleBailie methodology could be said account for this by identifyg a range fluences which contribute overall economic savgs. 1 Figures based on tal 4.75bn jury / fatality (cludg human ) has been saved from by a range facrs

7 Economic Payback Road Safety Advertisg NI Economic Payback Road Safety Advertisg NI The ideal experiment for measurg impact a road safety campaign would be comparg The two countries ideal experiment with exactly for measurg same road impact safety characteristics a road safety (age campaign structure would drivers, be comparg quality two road countries frastructure, with exactly wealth, same drivg road test safety stards characteristics etc) but (age where structure one has drivers, an advertisg quality campaign road frastructure, or wealth, does not, drivg order test stards have a true etc) counterfactual but where one measure has an advertisg isolate campaign impact a or campaign does not, amongst order or have fluences. a true counterfactual In practice however measure no perfect isolate counterfactual impact situation a campaign such as amongst this exists. or fluences. In practice however no perfect counterfactual Anor important situation issue such relevant as this exists. this work is replacement dem which based on Anor our correspondence important issue with relevant Department this work for is Transport replacement has not been dem considered which based this on our research correspondence date or with monetary Department road death for / serious Transport jury has not parameters been considered compiled by this research Department. date For or example monetary if a person road death has been / serious jured jury unable parameters work, compiled it has by been Department. assumed For this results example if lost a person output. has However been it jured is likely unable job can work, be it taken has been by a assumed migrant or a new this entrant results lost output. labour market However from it is non-employment likely job meang can be taken by net a migrant output impact or a new will actually entrant be less. labour It is however market beyond from non-employment scope this meang work re-estimate net output Department impact will for actually Transport be less. parameters. It is however beyond scope this work re-estimate The Department HM Treasury for Transport Green Book parameters. also outles issues surroundg displacement substitution The HM Treasury impacts Green which Book closely also related. outles They issues measure surroundg extent displacement which benefits substitution an tervention impacts which fset by closely reductions related. output They measure or employment extent from elsewhere. which benefits These issues an tervention much less important fset by for reductions this type economic output or payback employment analysis. from elsewhere. These issues much less important for this type economic payback analysis. 2.2 Or best practice examples 2.2 In terms Or or best road practice safety payback examples studies, LyleBailie runs virtually same road safety In advertisg terms campaign or road for safety Republic payback studies, Irel LyleBailie (ROI) on behalf runs virtually Road same Safety road Authority. safety advertisg The campaign campaign consists for television Republic radio Irel road (ROI) safety on behalf advertisements, Road one Safety beg Authority. Get pot, The campaign not consists pots. The television only difference radio with road safety approach advertisements, ROI, one beg terms Get pot, economic not payback pots. analysis, The is only difference s per with fatality approach serious jury ROI, based terms upon economic Goodbody payback Approach. analysis, 2 However is apart s from per this fatality it is our serious understg jury based upon payback methodology Goodbody Approach. adopted 2 for However ROI is identical apart from one this used it is for our understg DOE road safety campaign. payback methodology Havg tried adopted conduct for furr ROI is desk-based identical research one used or for economic DOE road payment safety campaign. assessments Havg relatg tried road conduct safety campaigns, furr desk-based we found research limited evidence or or economic examples payment however assessments with regards relatg general road economic safety impact campaigns, assessments, we found limited underlyg evidence prciples or examples (as set however out above) with regards tend be general followed. economic impact assessments, underlyg prciples (as set out above) tend be followed. 2 The associated s used ROI economic payback analysis based on a study carried out by Goodbody Economic Consultants on behalf Department Transport The followg values were estimated: Fatal = 2 2,280,000; The associated Serious s Injury used = 304,600; ROI Slight economic Injury = payback 30,000 analysis Material based Damage on = a 2,400. study carried out by Goodbody Economic Consultants on behalf Department Transport The followg values were estimated: Fatal =

8 Economic Payback Road Safety Advertisg NI 3 Critique existg methodology scope for development methodology 3.1 Existg LyleBailie methodology payback results As mentioned earlier, LyleBailie has developed a methodology measure economic payback DOE s road safety campaign. This is same as methodology applied ROI for Road Safety Authority apart from difference associated s fatalities serious juries as mentioned previously. The methodology economic payback results described below. It must be noted however only data currently not available for 2010 analysis is 2010 tal NI licensed vehicles 2010 number NI drivers. Hence an assumption has been applied based on Oxford Economics pressional judgement. This can be found by way summary Annex A. Wisdom Crowds road death /serious jury fluences Based on approach Wisdom Crowds, Millward Brown Ulster have conducted seven NI surveys between , designed capture formation on what dividuals fd most fluential road death / serious jury reduction NI. A range facrs have been identified as contributg this reduction (see Fig 3.1 below). Based on an average seven surveys, road safety TV advertisements were recognised as most fluential (23.03%) followed by police enforcement (12.55%), penalties (12.16%) road traffic laws (11.38%). Fig 3.1: NI death / serious jury reduction fluential facrs CONTRIBUTIONS TO ROAD CARNAGE The existg LyleBailie methodology applies this percentage dividuals noted road safety adverts as REDUCTION beg most fluential IN NORTHERN tal economic savg IRELAND (based on an expected mus PERCEIVED actual estimate VERY road INFLUENTIAL deaths serious FACTORS juries IN SAVING have been LIVES prevented AS A % over OF ALL period VERY ) INFLUENTIAL arrive at FACTORS economic AVERAGED payback OVER road safety 8 NI campaign. SURVEYS This 2003 our 2012 Changes Drivg view is a perfectly valid approach Test, is 7.29% adopted enhanced Police Oxford Economics enforcement, 12.55% methodology. More details provided on methodology payback results below. Road Traffic Table 3.1 below provides an overview underlyg figures used arrive at current Laws, 11.38% estimated overall economic savg. The estimates for potential or expected deaths serious juries over period based on average Penalties death Imposed by serious jury rates per 10,000 licensed vehicles (immediate period pre start Courts, 12.16% Car Design & advertisg Features, 7.60% campaign) aga Oxford Economics supports this approach adopt same assumption. Or estimates based on average death serious jury rates from an earlier period (i.e ) would our view over-estimate expected number deaths serious juries Road period after ( ). Engeerg, 6.35% Education Schools, 9.12% All DOE Advertisg, 23.03% News Coverage, 10.52% Source: Millward Brown Telephone Survey / Omnibus Base: Approx 1000 Respondents per wave (8133 over 8 years)

9 Economic Payback Road Safety Advertisg NI Table 3.1: Road death serious jury savgs ( ) Year NI Licensed Vehicles Potential road deaths at per 10,000 LV's Actual Deaths Savg (deaths) Potential road juries at per 10,000 LV's Actual road juries Savgs (juries) KSI Human Savg , , , , , , , , , , , , , , , , , , , , , , , , ,008, , ,024, , ,043, , ,050, , ,053, , Total 14,435,422 3,689 2,207 1,482 42,781 22,286 20,495 21,977 Source: LyleBailie PSNI Potential / Expected road deaths juries The potential deaths serious juries (as quoted Table 3.1) calculated usg followg expected death jury rates per number licensed vehicles: 1. Durg 3 years , cumulative tal licensed vehicles NI was 1,760, Durg same three years , cumulative tal road deaths was 450 serious juries was 5, Based on above, average rate road deaths per 10,000 licensed vehicles for was Based on a similar calculation, average rate serious juries was Death serious jury savgs To calculate economic savg generated, firstly savg (people-based) for both deaths serious juries calculated by subtractg actual deaths juries (as recorded by PSNI) from potential deaths serious juries. To n calculate monetary savg, absolute number deaths juries saved multiplied by respective s per head as Table 3.2 below. These s based on detailed Department for Transport estimates. Note s clude lost output, medical ambulance s a monetary human. (More is said on se parameters below note two-thirds road death is human element) Table 3.2: Cost per dividual death serious jury (June 2005 prices) Injury severity Lost output Human s Medical ambulance Total ( June 2005) Fatal 490, , ,428,180 Serious 18, ,110 11, ,490 Source: Highways Economics Note No. 1, 2005 Valuation Benefits Prevention Road Accidents Casualties

10 Economic Payback Road Safety Advertisg NI Existg economic savg payback results The current LyleBailie methodology results followg tal economic savgs over period : 1,482 road deaths at 1.43m per death = 2.12bn 20,495 serious juries at 0.16m per jury = 3.29bn Total economic savg = 5.40bn With 23.03% terviewees statg road safety advertisg campaigns were most fluential facr on death / serious jury reduction, this is terpreted be sh tal economic savg directly attributable road safety advertisg. Total economic savg attributable road safety advertisg campaign = 5.40bn* 23.03% = 1.25bn Given public spendg on campaign over period 23.09m, this equates a payback ratio return 54: 1 public money. Note different payback results presented by LyleBailie based on different assumptions used. The above results based on key assumption death jury average rates for period Critique existg methodology / scope for development The role for Oxford Economics this piece work has been critique LyleBailie methodology buildg on it, develop an improved economic payback methodology which meets best practice criteria subject available formation. From our knowledge existg LyleBailie approach, re some presentational methodological issues worthy consideration, which basis for how Oxford Economics come up with an enhanced methodology report on it. Presentation methodology The current economic payback estimate 54 for every 1 vested campaign over period will be strikg readers arouse questions over methodology. (As shown below clusion human element makes a major difference payback ratio). We feel build credibility for improve understg analysis a clear comprehensive methodology write-up validatg statement is required, which we hope is addressed by this report.

11 Economic Payback Road Safety Advertisg NI Economic Payback Road Safety Advertisg NI Cost per death serious jury assumptions Cost In per particular, death it is critical serious expla jury assumptions detail target audience economic per In death particular, serious it is critical jury assumptions expla detail as this target is paramount audience calculatg economic tal per death economic payback. serious jury The result assumptions estimated as by this Lyle Bailie is paramount is based on calculatg parameters taken tal economic from Department payback. The for Transport result estimated Highways by Lyle Economics Bailie is Note based No.1, on 2005 parameters Valuation taken from benefits Department prevention for Transport road accidents Highways Economics casualties Note (January No.1, ). Valuation The benefits parameters prevention do not represent road actual accidents s curred casualties as (January result 2007). road The traffic parameters collisions. Rar do not y represent -benefit actual s values curred as represent result benefits road which traffic collisions. would be obtaed Rar y by prevention -benefit road traffic values collisions. represent benefits which The would monetary be obtaed parameters by prevention given road traffic terms collisions. UK values (2005 prices). Given UK The wage monetary productivity parameters levels given higher terms than NI, UK we values consider (2005 it appropriate prices). Given adjust UK wage assumptions productivity le levels with this (see higher later than a facr NI, we consider approximately it appropriate 0.9 is applied adjust UK assumptions parameters). le An with argument this (see could later be a made facr apply approximately this facr 0.9 only is applied lost output UK element parameters). though we have An argument applied could facr be made each apply this parameters. facr only lost output The element associated though with we have each applied casualty, accordg facr each Highways parameters. Economics Note, is made The up associated lost output with (as each discussed casualty, above), accordg medical Highways ambulance Economics s Note, human is made s. up It is lost our output understg (as discussed lost above), output medical does not take ambulance consideration s human issue s. replacement It is our dem. understg If someone lost cannot output return does not work take due consideration jury or death, it issue does not replacement necessarily mean dem. If someone entire output cannot is return lost. It is work possible due jury job or vacated death, it would does not be filled necessarily by migrant mean labour or someone entire output who is is lost. currently It is possible unemployed hence job vacated net output would be impact filled would by migrant be less labour than or someone gross output who impact. is currently Also unemployed if an unemployed hence person net fills output ir position, impact would havg be less previously than claimed gross output benefits impact. before, Also this if could an unemployed actually result person fills a fiscal ir position, savg. (There havg is previously a possibility claimed displacement benefits before, with this vacated could job actually beg filled result by a a person fiscal savg. leavg anor (There is job a which possibility may not displacement be replaced). with While it vacated is important job beg flag filled up se by a issues, person it leavg is however anor beyond job which scope may not this be replaced). work re-estimate While it is important Department flag for up Transport se issues, it parameters, is however beyond which would scope be a substantial this work exercise. re-estimate However Department we have for Transport contacted parameters, Department for which Transport would be fd a out substantial greater exercise. detail how However lost output we s have contacted calculated. Department Although not for havg Transport received fd a response out greater back, we detail will how follow lost this output up. s calculated. The Although human not havg 3 element received a overall response death back, we serious will follow jury this s up. is based on willgness The pay human represents 3 element pa, overall grief death sufferg serious jury casualty, s is relatives based on willgness friends. Human pay s represents / benefits pa, not grief typically cluded sufferg or casualty, payback relatives or economic friends. impact Human analysis, s normally / benefits because y not typically difficult cluded quantify. or It is our payback view or economic we present impact analysis, results with normally without because human y s difficult order quantify. comp It is our view outcomes we present with or results types with payback without analysis. human (Refer s back order table 3.2 comp for s associated outcomes with with death/ or types serious jury). payback analysis. (Refer back table 3.2 for s associated with death/ Opportunity serious jury). is anor issue be considered. Given police/ ambulance s curred, Opportunity se services is anor could issue have been be considered. put use Given anor situation police/ ambulance hence s carry an curred, opportunity se. services It is our could understg have been put parameters use anor available situation for s hence which carry an opportunity part valuation. It is our an jury understg accident but which parameters not specific available casualties for s (police which part admistrative valuation s, as an well jury as property accident s) but which although not se specific not cluded. casualties (police admistrative s, as well as property s) although se not cluded. 3 Human s defed Department for Transport s Highways Economics Note No. 1 as based on willgness pay values which represent pa, grief sufferg casualty, relatives friends, for fatal casualties, trsic 3 Human loss s enjoyment defed life over Department above for Transport s consumption Highways goods Economics services Note No. 1 as based on willgness pay values which represent pa, grief sufferg casualty, relatives friends, for fatal casualties, trsic loss enjoyment life over above consumption goods services

12 Economic Payback Road Safety Advertisg NI Anor important pot note is economic associated with each death serious jury is age dependent. For example death a younger person will have a higher lifetime economic than an older person due more years lost output. If age prile deaths serious juries NI differed markedly from UK, an adjustment should be made for this. However this formation was not available us difference is unlikely be large. Two or facrs we would like have cluded but have not been possible due data limitations ; where deaths serious juries occur (different parameters available for urban versus rural) splittg licensed vehicles type (e.g. undertakg expected versus actual analysis for cars, morcycles, HGVs etc). Additionality / deadweight As stated before it is essential measure additional benefits this campaign generates. This ensures economic payback analysis accounts for deadweight effect measures only impacts purely associated/ additional this campaign. To be fair many facrs associated with reduction road deaths / serious juries have already accounted for current model (e.g. or fluences Fig 3.1), though or facrs could be cluded. (Recall from above we consider economic sophistication be part overall fluences not a separate direct fluence) Some previous analysis predict potential road deaths for period has been measured based upon average death serious jury rates per 10,000 licensed vehicles. (Analysis is also based on average death serious jury rates it is not clear us which set analysis is accepted used by DOE). As said previously, we believe context this work average death jury rates should be based closer when advertisg campaign began. It is clear difference this makes Killed Serious Injury (KSI) human savg. Previous research by Lyle Bailie based on rates over period , estimated overall KSI savg be 21,032 whereas comparison rates for same time period, KSI savg was 12,488. Even with applyg death jury rates for period immediately before start advertisg campaign, re facrs outside those Fig 3.1 which deadweight case will affect death jury rates se clude age prile drivers, average road speeds, urbanisation, average distance travelled by vehicle etc. - LyleBailie publications for DOE have shown male drivers aged four times more likely suffer a fatal car accident than average driver ( three times more likely for a serious jury) Figs Therefore sce sh male drivers has been fallg (Fig 3.4), this should be an important fluence on deadweight scenario i.e. number fatal accidents serious juries should also fall).

13 Economic Payback Road Safety Advertisg NI Economic Payback Road Safety Advertisg NI Fig 3.2: Deaths by age b Fig 3.3: Serious juries by age b 5 Fig 3.2: Deaths by age b 4 Fig 3.3: Serious juries by age b Deaths per Deaths capita per ratio capita ( ) ratio ( ) Source: M M M M M M 65+ F DOE LyleBailie M 25- M 35- M 50- M 65+ F F F F F NI average NI average F F F 65+ F 65+ Serious Serious jury per jury capita per ratio capita ( ) ratio ( ) Source: M M M M M M 65+ F M 25- M 35- M 50- M 65+ F 17- DOE LyleBailie F F F F NI average NI average F F F 65+ F 65+ Source: DOE LyleBailie Source: DOE LyleBailie Fig 3.4: Change licensed vehicles by age b owner ( ) 4% Fig 3.4: Change licensed vehicles by age b owner ( ) Change Change licensed licensed vehicles vehicles by age b by age (2000- b ( ) 2011) 4% 2% 2% 0% 0% -2% Source: -2% DOE, LyleBailie Oxford Economics Source: DOE, LyleBailie Oxford Economics - Urbanisation road speeds would be expected be ter-lked affect expected deaths juries. Slower road speeds, associated with creased commutg or - Urbanisation road speeds would be expected be ter-lked affect expected urbanisation, should contribute lower death jury rates. Time series data on deaths juries. Slower road speeds, associated with creased commutg or average road speeds NI is however severely limited not fit for use this study. urbanisation, should contribute lower death jury rates. Time series data on Although average road speed is one Government s Economic Development Forum average road speeds NI is however severely limited not fit for use this study. (EDF) dicars under frastructure pillar, data is only collated presented for Although average road speed is one Government s Economic Development Forum two sgle years. It is very difficult estimate rates urbanisation as this requires (EDF) dicars under frastructure pillar, data is only collated presented for small a population statistics which only available Census years. two sgle years. It is very difficult estimate rates urbanisation as this requires - small Distance a travelled population would statistics be a which better variable only available than number Census years. vehicles licensed estimate expected deaths juries as creased household second car-ownership - Distance travelled would be a better variable than number vehicles licensed may result fallg average distance travelled per vehicle (though creased female estimate expected deaths juries as creased household second car-ownership employment commutg may fset this). Predicted deaths juries based on may result fallg average distance travelled per vehicle (though creased female registered vehicles rar than average distance travelled per vehicle could refore employment commutg may fset this). Predicted deaths juries based on lead an over-estimation potential deaths/ juries. Unfortunately data limitations registered vehicles rar than average distance travelled per vehicle could refore mean it is only possible at this stage use average distance travelled as a separate lead an over-estimation potential deaths/ juries. Unfortunately data limitations fluence recent evidence suggests average distance travelled has been fairly stable mean it is only possible at this stage use average distance travelled as a separate (Fig 3.6). fluence recent evidence suggests average distance travelled has been fairly stable (Fig 3.6).

14 Economic Payback Road Safety Advertisg NI Economic Payback Road Safety Advertisg NI Licensed Licensed vehicles vehicles (2000=100) (2000=100) Fig 3.5: Licensed vehicles distance travelled Fig 3.5: Licensed vehicles distance travelled Licensed vehicles (LHS axis) Licensed vehicles (LHS axis) Distance travelled (RHS axis) Distance travelled (RHS axis) Source: DOE, LyleBailie Oxford Economics Source: DOE, LyleBailie Oxford Economics 3.3 Summary 3.3 What this Summary all means is Oxford Economics broadly agree with existg approach used by LyleBailie, however with scope for: What this all means is Oxford Economics broadly agree with existg approach used by LyleBailie, Adjustg however Department with scope for for: Transport UK economic per death jury assumptions le with UK: NI productivity differential ( better reflect value output lost Adjustg Department for Transport UK economic per death jury assumptions NI economy) le with UK: NI productivity differential ( better reflect value output lost Presentg NI economy) payback results with without human element ( improve comparisons with or payback studies) Presentg payback results with without human element ( improve Improvg comparisons how with deadweight or payback is accounted studies) for by facrg changg age prile drivers change average distance travelled per licensed vehicle, better measure Improvg how deadweight is accounted for by facrg changg age prile net economic payback drivers change average distance travelled per licensed vehicle, better measure At this net stage, economic primarily payback due data limitations / scope what we have been asked do, it is not possible facr followg fluences: At this stage, primarily due data limitations / scope what we have been asked do, it is not Average possible road facr speeds followg fluences: Average Where collisions road speeds occur given assumptions for urban rural as differ Distance Distance travelled travelled (2000=100) (2000=100) Source: Fig 3.6: Average distance travelled per vehicle Fig 3.6: Average distance travelled per 14 vehicle Millward 6 Brown Annual Car Report Survey Oxford Economics Millward Brown Annual Car Report Survey Oxford Economics Where Deaths collisions / serious occur juries given by type assumptions vehicle (i.e. for analysis urban expected rural as versus differ actual deaths undertaken dividually for cars, morcycles etc) Deaths / serious juries by type vehicle (i.e. analysis expected versus actual deaths undertaken dividually for cars, morcycles etc) Average Average distance distance travelled travelled per vehicle per (000 vehicle (000 miles) miles) Source:

15 Economic Payback Road Safety Advertisg NI 4 Enhanced Oxford Economics methodology Based on issues / as for development identified previous chapter, below we illustrate approach Oxford Economics has adopted enhance current approach measurg economic impact DOE s road safety advertisg campaign. We also identify Fig 4.1 additional fluences would be useful clude, but which we have not been able address directly this piece work. 4.1 Enhanced methodology stages Fig 4.1: Oxford Economics road safety economic payback methodology Information available Actual deaths/ serious juries Actual deaths / serious juries Expected deaths / serious juries Information available Death/ serious jury rate per vehicle at start campaign ( ) Average distance travelled per vehicle ( ) Age gender licensed drivers ( ) Information not currently available Urban-rural breakdown vehicle type breakdown accidents Death serious jury savg Information not currently available Average road speeds / urbanisation Urban-rural breakdown vehicle type breakdown accidents Information available NI: UK productivity differential Cost per death serious jury Key issue Include / exclude human element Total economic savg Information not currently available Urban-rural breakdown accidents Wisdom Crowds ory ECONOMIC PAYBACK Information available Convert pubic expenditure contribution advertisg campaign 2005 prices

16 Economic Payback Road Safety Advertisg NI 4.2 Expected deaths serious juries The itial part model volved usg existg hisrical formation ( ) on actual deaths serious juries provided us by LyleBailie from ir Wisdom Crowds research. As can be seen Fig 4.2 below, sce 1986 number road deaths has decled even as number licensed vehicles has been creasg. This has meant road death rate per 10,000 vehicles has fallen sharply (Fig 4.4). As we mentioned earlier report, when applyg average rates for deaths serious juries, an average rate closest when campaign was launched must be used. If expected death rates were based on average this would not be particularly representative campaign timeframe our view over-estimate expected deaths juries 4. A similar trend is observed Fig 4.3 with regards licensed vehicles serious juries. Although a significant rise serious juries occurred between (this may be explaed by data issues) this trend n began fall aga despite a contued rise licensed vehicles. That said serious juries have always remaed substantially higher than number deaths as we would expect. Fig 4.2: Licensed vehicles road deaths 1, ,000 Licensed vehicles (LHS axis) Licensed vehicles (000s) Road deaths (RHS axis) Road deaths Source: DOE, LyleBailie Oxford Economics 4 We have built a ol our model allowg various sensitivity analyses be conducted. 3 options for average death serious jury rates can be used, one based on averages, or for averages (as used by LyleBailie which we also use) we have also cluded a furr option solely 1994 rates, most recent before campaign was itiated. Clearly each rate will have a different impact on death/ serious juries estimated i.e. average rates based on averages will estimate higher deaths serious juries than rate.

17 Economic Payback Road Safety Advertisg NI Fig 4.3: Licensed vehicles serious juries Licensed vehicles (000s) 1,200 1, Source: DOE LyleBailie Licensed vehicles (LHS axis) Serious juries (RHS axis) ,600 2,400 2,200 2,000 1,800 1,600 1,400 1,200 1, Serious juries Figure 4.4: Deaths serious juries per 10,000 licensed vehicles Deaths per 10,000 vehicles Deaths (LHS axis) Serious juries (RHS axis) Injuries per 10,000 vehicles Source: DOE, LyleBailie Oxford Economics 0 To enhance estimation expected road deaths serious juries takg greater consideration deadweight effects, we clude followg additional fluences on potential deaths juries: Change age prile gender licensed drivers; Change average distance travelled per licensed vehicle

18 Economic Payback Road Safety Advertisg NI Economic Payback Road Safety Advertisg NI Change age prile gender drivers Change As explaed age prile previous gender chapter, male drivers drivers aged have highest road death rate per As explaed capita NI. It previous is also chapter, case male drivers same aged category have male drivers highest has road death highest rate per serious capita jury NI. rate by It is age also b case gender. same category male drivers has highest serious Oxford Economics jury rate by has age developed b a gender. composite age-death/ serious jury rate dex 5 order Oxford adjust Economics expected has road developed death a composite serious jury age-death/ estimates serious for jury changg rate dex age 5 order gender prile adjust drivers expected given road death relative serious death jury jury estimates rates for differ changg quite significantly age gender across prile different demographic drivers given driver groups. relative death jury rates differ quite significantly across different Change demographic average distance driver groups. travelled Change It would be average appear sensible distance travelled expected road deaths juries would be directly lked 1 for It 1 would average be appear distance sensible travelled. expected Usg data road provided deaths by LyleBailie juries would our be directly own assumptions, lked 1 for 1 we have average calculated distance average travelled. distance Usg data travelled provided per by licensed LyleBailie vehicle our from own assumptions, (we we assume have no calculated change average distance given no travelled data is available) per licensed vehicle dexed from The annual (we assume difference no from change is n calculated given no data a is proportion available) this dexed is taken as impactg The annual on difference expected road from deaths/ 2000 serious is n juries calculated (facr set a at proportion 1). this is taken as impactg on expected road deaths/ serious juries (facr set at 1). 4.3 Cost per death/ serious jury 4.3 As defed Cost by per Department death/ serious for Transport jury Highway Economics Note, re three s As associated defed with by road Department death/ serious for Transport jury. These Highway lost Economics output, human Note, re s three ambulance s associated medic with s. road As death/ discussed serious jury. chapter These 3, given lost output, significant human size s human ambulance element medic (two-thirds s. As discussed road death chapter ) 3, given fact significant this type size is generally human not element captured (two-thirds or payback road analysis, death our ) methodology fact is designed this type order facilitate is generally clusion not captured or exclusion or this payback human. analysis, our methodology is designed order facilitate clusion or In exclusion addition this human above,. enhanced model also accounts for annual productivity In differential addition between above, UK enhanced NI (average model 0.9 also ) accounts from for Oxford annual Economics productivity UK differential regional model between which uses UK Regional NI (average Accounts GVA ) data ficial from employment Oxford Economics estimates. UK regional The associated model s which outled uses Regional Highways Accounts Economic GVA data note ficial n employment adjusted accordgly estimates. The account associated for this difference. s outled Highways Economic note n adjusted accordgly account for this difference. 4.4 Wisdom Crowds economic payback 4.4 Havg now Wisdom reached a Crowds tal economic economic savg payback next stage follows LyleBailie s approach Havg Wisdom now Crowds. reached a Knowg tal economic 23.03% savg next respondents stage follows rate LyleBailie s road safety approach advertisg Wisdom campaigns as Crowds. most fluential Knowg death 23.03% / jury reduction, respondents this percentage rate road safety is applied advertisg overall campaigns economic as most savg fluential calculate death monetary / jury reduction, value / economic this percentage payback attributable is applied overall road safety economic campaign. savg To calculate n convert monetary this as a return value / economic every 1 payback public attributable money vested; road this value safety is campaign. divided by To n overall convert this as a campaign return every (net 1 sponsorship) public money 22.84m, vested; this converted value is 2005 divided prices by usg overall Consumer Price campaign Index (CPI). (net sponsorship) 22.84m, converted 2005 prices usg Consumer Price Index (CPI). 5 This measure is based on death per capita serious jury per capita multiplied by sh male/ female divers with a particular age category. This is dexed 2000=100 annual difference from 2000 is n calculated, takg 5 This measure a proportion is based this on as death impactg per capita on expected serious road jury deaths/ per serious capita juries multiplied (set by at 0.5). sh Ideally male/ furr female research divers is required with a particular form age assumed category. facr This is 0.5 dexed 2000=100 annual difference from 2000 is n calculated, takg a proportion this as impactg on expected road deaths/ serious juries (set at 0.5). Ideally furr research is

19 Economic Payback Road Safety Advertisg NI 5 Oxford Economics economic payback based on enhanced methodology Oxford Economics model has been set up such a way which can produce a variety sensitivity analyses, cludg hittg origal LyleBailie payback estimate. We have decided present payback results for followg three scenarios (underlyg assumptions outled): 1. LyleBailie origal scenario (usg average road death serious jury rates) 2. Oxford Economics enhanced methodology scenario excludg human element Department for Transport parameters average road death serious jury rates; adjustg expected deaths serious juries for change age prile gender licensed drivers change average distance travelled per licensed vehicle; adjustg Department for Transport parameters for NI:UK productivity differential; convertg public expenditure on road safety advertisg campaign 2005 prices; excludg human element from Department for Transport parameters 3. Oxford Economics enhanced methodology scenario cludg human element Department for Transport parameters as above but cludg human element from Department for Transport parameters By presentg se three scenarios, this will provide DOE / LyleBailie with an understg how corporatg fluences such as change age prile gender licensed drivers change average distance travelled per licensed vehicle impacts on expected deaths / serious juries tal economic savg. It will furr highlight significant impact excludg human s has on overall payback also highlight difference accountg for UK/ NI productivity differential will have. The payback results for three scenarios presented below: Table 5.1: DOE road safety advertisg campaign economic payback - alternate scenarios Origal LyleBailie Oxford Economics enhanced methodology scenario excludg human Oxford Economics enhanced methodology scenario cludg human Total economic savg ( m, 2005 prices) 5,406 1,042 4,183 % attributable road safety advertisg campaign 23.03% 23.03% 23.03% Road safety economic payback ( m, 2005 prices) Economic payback ratio Source: Note: Oxford Economics Lyle Bailie public spend figure is measured current prices Table 5.1 shows economic payback ratio drops from 54 origal LyleBailie scenario 42 usg enhanced Oxford Economics methodology (cludg human element), drops significantly 10 when human element is excluded. It should be noted a payback ratio 10 would still be considered high although it is difficult make comparisons across or public secr terventions due different nature terventions.

20 Economic Payback Road Safety Advertisg NI Table 5.2 below decomposes differences dividual components. This highlights once aga impact excludg human element. Table 5.2: Explag differences - alternate scenarios Road safety economic payback ( m, 2005 prices) % difference Origal LyleBailie Oxford Economics enhanced methodology scenario excludg human Difference o/w change age prile gender drivers % o/w change average distance travelled % o/w applyg NI:UK productivity differential % o/w excludg human element % Difference economic payback ratio o/w conversion public spend 2005 prices Source: Oxford Economics

21 Economic Payback Road Safety Advertisg NI 6 Validatg statement As requested by LyleBailie, we have provided a validatg statement below which can accompany payback analysis relevant publications: The underlyg methodology used produce an estimate economic payback DOE s road safety advertisg campaign ( ) has been developed by Oxford Economics. Oxford Economics is one world s leadg providers economic advice, with over 300 clients cludg ternational organisations (such as IMF World Bank), Government departments UK, US Europe (cludg HM Treasury, DTI Department for Transport), central banks (e.g. Bank Engl), as well as a large number blue-chip companies across whole dustrial spectrum. Oxford Economics methodology is based on an enhanced version an origal methodology developed by LyleBailie International, which replicated same approach used Republic Irel for Road Safety Authority. As such Oxford Economics methodology can be considered be more advanced than used or jurisdictions. Where possible methodology attempts adopt best practice by quantifyg net as opposed gross additional impact advertisg campaign (i.e. accounts for deadweight effects). It does this by facrg exogenous fluences on expected road death serious jury rates. These clude changes age gender prile licensed drivers (statistical evidence for NI shows a large divergence per capita road accident rates for different demographic driver groups) changes average distance travelled per licensed vehicle. Due data limitations, it is not possible at this stage clude enhanced methodology or fluencg facrs such as changes average road speeds, rates urbanisation commutg patterns (shifts public transport will directly be accounted for by average distance travelled per vehicle). In addition methodology could future be developed by splittg road deaths serious juries (1) urban rural (as where collisions occur has an fluence on assumed ficial assumptions); (2) by vehicle type. While this creased sophistication would likely have some impact on estimate for payback, it is Oxford Economics view difference would be relatively mor. The economic parameters per road death serious jury taken directly from widely used accepted UK Department for Transport s Highways Economics Note No. 1, 2005 Valuation Benefits Prevention Road Accidents Casualties. To best Oxford Economics knowledge, se stard parameters used road safety payback analysis no or parameters exist. Given lost output element overall is based on value output forgone, Oxford Economics has adjusted UK overall parameters usg ficial NI:UK productivity (GVA per employed person) differentials. Allocatg what proportion tal net economic savg is attributable road safety advertisg campaign is based on survey evidence by Millward Brown on all policyfluential facrs which dividuals consider have greatest impact on road death / serious jury reduction NI.

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24 If you would like know more about this Report or how use psychological research improve road safety campaigns, please contact Fiona Rooney, Psychology Direcr, LyleBailie International, Telephone: Fax: If you would like consultancy advice on how develop a communications methodology for changg road behaviour conjunction with enforcement how measure road safety economic payback, please contact David Lyle, Chief Executive, LyleBailie International, david.lyle@lylebailie.com Telephone: Fax: Bruce Street, Belfast BT2 7JD T F E direcrs@lylebailie.com SPECIALISTS IN ATTITUDE & BEHAVIOUR CHANGE