The economic impact of tollgates

Government recently gazetted and released tollgate fees that vehicles passing through the Blantyre-Lilongwe M1 stretch will be required to pay at Chingeni in Balaka and Kalinyeke in Dedza Districts.

This development has caused inspired debate on whether Malawians need these tollgatess.

To understand this, one needs to know that a toll road is a privately or publicly built road for which a driver pays a toll (fee) to use.

The toll fee is generally charged to help compensate the cost of the road’s maintenance. The amount varies by type of vehicle, weight or number of axles.

But the question is: Why should we pay toll fees on existing roads that were paid for by our taxes? Road performance depends on how, what and when maintenance is done. They deteriorate over time due to environmental influences such weather ultra violet radiation, and overloading.

Toll roads and the tollgates have certain distinct advantages for road users and the wider community.

Tollgates ensure high quality road networks. Such roads are usually upgraded and expanded before they are tolled to increase capacity, thus, reducing congestion. The rapid increase in the number of cars on our roads is simply unsustainable and becoming a strain on economic and social development.

Road upgrades also save running costs of vehicles, improves safety and decreases accidents. In some countries like South Africa, tolls also act as a form of congestion charge. It rations the use of the road to those with the high need to travel.

Building roads costs billion of kwacha and toll roads enable the public sector to contract the private sector for the construction, operation and maintenance of the roads. The Road Fund Administration (RFA) officials have indicated that they are expected to be collecting K4.5 billion a year through tollgates.

Toll roads will accelerate the availability of initial funding for construction and maintenance compared with traditional tax-based funding. Tolls collected can also be used to repay the loans obtained to finance the construction and upgrading of the roads. It is a self-generating form of income.

Toll roads can also significantly increase a country’s growth as measured by the gross domestic product (GDP) over the lifetime of the project. Such projects lead to direct (constructors, builders, architects) and indirect (toll road attendants at toll points, casual workers) job creation.

The job creation is stimulated through the increased business and commercial opportunities. We need job creation as unemployment is increasing.

Government will also generate revenue if it invests in the public sector enterprises such as modern train and bus services because people will use them to avoid unnecessary toll fees. This will be a spillover effect of tollgates.

However, for all their apparent advantages, tollgates have a downside too. The disadvantages of toll roads are mostly related to user reactions.

An increased load might be imposed on the alternative routes due to traffic diversion. People will generally react negatively towards any change.

The introduction of tollgates fees will have great impact on business, especially Small and Medium Enterprises (SMEs).

Recently, minibus owners said they would engage government on the perceived exorbitant charges which, they said, are threatening their business operations. This could eventually push up the cost of transport and, consequently, prices of services and products. This burden could then be passed on to the consumer.

Toll fees have been deemed to be on the higher side by many, especially when we compare with other countries like South Africa.

The government should probably do something on road traffic levies and other charges so that the public has some sort of relief. As it stands now, people are paying road transit fees and fuel levy.

The public also needs assurance from the government that the money collected will be used for intended purposes and not diverted through fraud and corruption. The impact of corruption increases risk of unsafe conditions on both our roads and transport systems, resulting in fatal accidents.

Government through RFA must engage all stake holders and publicise this initiative for the people to understand. As soon as public get used to the tolls and realise the benefits, their attitudes will change.

The advantages of tollgatess out-weighs the disadvantages by far.