Dear Hon Minister Henry
Welcome back to your Ministerial post and congratulations on your
electoral success with the Jamaican people. Let me thank you for the
opportunity to contribute to the public consultation regarding the
determination of toll fees for the North-South highway in Jamaica. Also
congratulations to the CHEC and its workers on
completing this, one of the most important transport infrastructure
investment projects that Jamaica has made since independence.
Yes individual motorists and drivers will do their own personal calculations to see
how the benefits of using the highway (reduced petrol consumption, reduced wear
and tear on their vehicle, value of their time saved etc.) trades off against
the costs of them using it (the toll charge primarily). Some may need to be "sold"
on this perspective !!
Then the operator of the toll road has the economic forecast calculations
to do, about getting the highest number of users possible for each hypothetical
fare level.
So how do we square these different and conflicting interests?
WELL I believe the FINAL determination of the toll rates charged
must be done such that it results in the COUNTRY as A WHOLE economical
benefitting from the FULL usage of this investment asset. And fortunately there
is modern technology available, through vehicle e-tags (like SUN PASS in the USA
and Congestion Zone charging in the UK), which can introduce THE NECESSARY element
of PRICE DIFFERENTIALS in the toll charging principles applied.
Through the use of such technology, frequent users can have a
reduced charge structure which declines for each time the toll is used. Or they
could have an annual or weekday pass. Tourist based operators can be
distinguished from local commuters by vehicle coding. Time of day usage charges
can be made variable to encourage the heavy goods to travel during the night
for example. Week day rates could be made different to weekend rates separating
the principle "business" from "leisure" users.
If this was not incorporated in the original design of the highway toll
operation IT SHOULD BE DONE NOW - even if it means a little more investment in
the technology required - number plate recognition cameras, registered database
users, e-tags (apparently there is evidence of this already in place)!!
Fortunately for indicative purposes, there will be some real life
data available - the historical toll income and actual vehicle usage of the
initial "middle" leg of this highway (opened over a year ago) should
be available and can be analysed to provide some basis for determining the
differential toll prices.
The highway has the potential to open up considerable economic
benefits when considered in the wider national context and so the setting of
the toll charges should PRMARILY be dictated by this factor. If such strategic
value had not been thought of prior to its design and commissioning then this
is a remarkable underachievement in government performance - irrespective of
whichever party it was.
By this I mean, for example, the potential to develop corridors of
commuter developments - properly planned and developed.
Most importantly the linking of the 2 significant diverse economies
of the metropolitan capital of Kingston and the tourist sector - Ocho Rios,
cruise ship traffic and others - with create synergies and opportunities - where
the resultant ECONOMIC TOTAL BENEFIT is greater than the sum of the individual parts.
This facilitator of innovation is a key to GROWING the country's economy.
There are also many important intangibles which will accrue - from
experience elsewhere - such as less pollution, less environmental damage, more
efficient use of vehicles, transportation time savings to companies, probably
fewer road accidents and deaths than on winding roads.
Indeed our company, Newer Worlds, is already developing initiatives
and investment projects which leverages this new economic dynamic and paradigm
shift for commercial interests.
In the majority of cases worldwide, large scale transportation
infrastructure projects DO NOT get fully paid for ONLY by the direct users - that
is to say, in this case, the motorists.
It usually requires a subsidy by the Government - that is to say ALL
TAXPAYERS eventually contribute towards part of its CAPITAL cost recovery - one
way or another. (Maintenance of the physical asset - its operational cost - is
another matter and these two different cost components should be considered
separately).
What we DON'T want to happen is to see an investment project asset
languishing due to under-utilisation through low usage by the public. Jamaica
has already lost YEARS of economic development by NOT having appropriate 21st
century infrastructure (old transport links, high electricity charges etc) and
also by having had this same asset sit idle for many years, incomplete, until
the Chinese came along and finished the job.
Jamaica has a lot of economic development to catch up on - so let us
harness the potential of this national asset to its fullest with a proper DIFFERENTIAL
toll charge structure APPLIED with the benefit of modern technology.
