House opposed to highway toll rates

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)