In the current practice of the economic appraisal of transport projects, the value of travel time savings (VTTS) for business trips is derived from the Cost Saving Approach (CSA) whereby travel time savings were valued at the Marginal Product of Labour (MPL), defined as the average wages plus on costs. This approach has been adopted nationally by Austroads and Transport for NSW, and internationally by UK and other European countries. It assumes that business travellers do not undertake any productive activities while travelling and that all travel time savings will be used for business and not leisure. Supported by portable computing devices, there is a view that an increasing proportion of business travellers and commuters work while travelling. On the other hand, a significant proportion of business travel time savings has been used for leisure instead of work. This paper uses the Hensher Equation developed in the 1970s to obtain an alternative valuation of contemporary business travel time savings by introducing two productivity foregone corrections for (1) the productive use of travel time, and (2) unproductive use of business travel time savings. The purpose of this paper is to translate recent research on the valuation of business travel time savings into practical tools for incorporation in economic appraisal methods
