Area Licensing Scheme

Area Licensing Scheme

Aim and Introduction

To combat the high traffic volume in the Central Business District (CBD) as a result of rapid growth, the government implemented the Area Licensing Scheme (ALS) in the year 1975. This scheme required motorists to pay for the usage of certain roads within regions named as Restricted Zones.

Detailed Description

The ALS required motorists to purchase special paper licences at US$3 per day in advance, from convenient locations such as post offices, gas stations amongst others. There were 34 gantries around the Restricted Zone, where police officers patrolled to ensure that motorists had their licenses. Fines were at a high rate of S$70, if any motorist did not have the required licence.
The exemption policy from the ALS licencing scheme had gradually shifted over the years. Originally, carpooling, public transportation as well as passenger cars with four or more passengers were allowed to enter without the licence. In 1989, motorcycles and heavy vehicles made up the bulk of the traffic entering, resulting in a change in the policy. It resulted in only buses and emergency vehicles having the privilege of being exempted from the charges.

Fees increased to US$5 in 1980, before falling back to US$3 in 1989 since more vehicles were paying the fees. To prevent fraud and to make the officers' jobs easier, paper licences varied in shape based on the class of the vehicle, with colour-coded licences provided for vehicular entry during peak hours. The colour of the licences changed from month to month, to prevent reusing of licences from the previous month.


Motorists expressed concern and dissatisfaction about the increased costs of travelling into the CBD. However, the ALS has proven itself to be successful in reducing traffic into the city area. According to the “The Journey – Singapore’s Land Transport Story”, the vehicular number fell from 32,500 to a mere 7,700. This 76.3% drop definitely justifies the effectiveness of ALS.


It was later merged together with the Road Pricing Scheme, a variation of the ALS for expressways, to be collectively replaced by the Electronic Road Pricing (ERP) which retains its legacy even till this current day.
Principles of Governance and their applications in ALS

  • Leadership is Key
    • The Singapore government recognised the dissatisfaction arising from the citizens, especially motorists, about the exorbitant fees to purchase entry into the Restricted Zone. However, the leaders maintained their stance on this issue, and continued the ALS despite large disputes. This showed that they did not succumb to populist ideas and made the right decision, exhibiting moral courage, showing the essence of the principle "Leadership is Key".
  • Anticipating Change and Staying Relevant
    • The government had cleverly identified the phenomenon that there was high traffic volume into the Central Business District, and that it would readily increase as the industrial restructuring took place. To solve this problem before it was aggravated, the government put a stop to this by implementing the ALS to deter motorists from driving into the Restricted Zone, such as to alleviate the traffic. This was indeed anticipating the change and staying competitive!

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(Left) The Restricted Zone is clearly demarcated along the broken blue line, in which motorists have to pay to use roads within the boundaries.
(Right) A typical ALS coupon, which motorists receive upon paying for the usage of specific roads in the Restricted Zone.