House opposed to highway toll rates

JAKARTA (JP): A House of Representatives commission expressed opposition yesterday to the government's plan to raise toll road tariffs, proposing, instead, the introduction of a cross-subsidy system in the operation of highways.

"The government should not increase the rates of the existing toll roads because their investors have recovered their capital and even made profits from their operations," a member of Commission V, Sofyan Usman, said during a hearing with Minister of Public Works Radinal Moochtar.

However, Sofyan said he did not object to PT Jasa Marga, the state-owned company in charge of managing Indonesia's toll roads, setting higher rates for newly-opened toll roads.

Achmadi, vice chairman of the commission, which is in charge of transportation and tourism, said that the Ministry of Public Works should submit a proposal to the House regarding the planned increase in toll roads fees before making such a proposal to the President.

The government has allowed private sector companies to take part in the construction and administration of toll roads but the toll rates continue to be determined by the government. This is the first time the government has consulted the House of Representatives before increasing toll rates.

Radinal promised yesterday that the government would not raise the tariffs before it had obtained approval from the House.

The president of PT Citra Marga Nusaphala Persada, a company which has established a toll road between Cawang and Tanjung Priok in Jakarta, Siti Hardiyanti Rukmana, recently proposed that the highway toll rates be raised by between 25 percent and 50 percent to help it increase the accumulation of funds for loan repayment.

The toll rates for the highway segment between Cawang and Grogol are between Rp 2,000 (about 89 U.S. cents) and Rp 4,000 -- depending on the size of the vehicle. Citra Marga, under an agreement, collects three quarters of the toll revenues and Jasa Marga only the remaining quarter.

Citra Marga, which is listed on the Jakarta Stock Exchange, is 22 percent-owned by Yayasan Purna Bhakti, 17.78 percent by Jasa Marga, 13.2 percent by PT Bhaskara Duniajaya, 8.89 percent by state-owned steel company PT Krakatau Steel, 8.8 percent by PT Indocement Tunggal Prakarsa, 4.4 percent by Citra Lamtoro Gung Persada, 0.5 percent by cooperatives and 24.4 percent by the investing public.

Radinal told reporters that the proposal for the toll rate hike was aimed at attracting investors for the construction of 19 new toll road segments in Java and Sumatra.

So far 48 investors, including eight foreign firms, have qualified to take part in the tender for the construction of the road segments.

The government raised toll road tariffs in July 1992 by between 20 percent and 50 percent.(31)