Private sector backs road toll increases

The Jakarta Post, Jakarta

The private sector has expressed support for the government's move to increase road toll rates on the condition that the increase is based on sound economic calculations and not political pressure.

"Such a move is needed as investors need certainty to calculate the projected revenue on their investment," the Indonesian Chamber of Commerce and Industry (Kadin) chairman Mohamad S. Hidayat said.

He said that the government should give its assurance that the rates were set based on economic, not political, considerations in a bid to attract fresh investment to the country's ailing infrastructure.

Investors have been somewhat reluctant to invest in infrastructure projects such as toll roads, power, water and ports as rates that are determined by the politically climate pose a high risk on their return on investment.

Hidayat, however, said that according to Law No. 38/2004 on roads, the government could make adjustments to toll rates through a ministerial regulation without legislators' endorsement.

The government raised road toll rates on Tuesday at 9 p.m.

State toll road operator PT Jasa Marga president director Syarifuddin Alambai said Minister of Public Works Djoko Kirmanto had signed the ministerial regulation on the toll rate hike earlier in the day.

"The minister signed it (the regulation) this morning (Tuesday) and it will take into effect at 9 p.m.," he said as quoted by Antara.

He added that there would be an average increase of 16 percent.

However, public transportation vehicles are entitled to a 25 percent discount if they subscribe to monthly toll tickets, with the exception of taxis.

Djoko said on Monday that Jakarta's city toll rate would increase by Rp 500 (51 U.S. cents), which would mean an increase from Rp 4,000 to Rp 4,500 for private cars.

He acknowledged there have been many complaints about the poor services provided by toll operators and questions as to whether the increase in the rates was appropriate.

Nevertheless, toll road operators had submitted their plans to improve their services including a plan to open new toll gates to ease congestion.

Djoko said his ministry would issue a warning to toll road operators if they failed to fulfill their promise to improve services.

The law on roads and Government Regulation No. 15/2005 on toll roads stipulate that road tolls shall be raised every two years to adjust to inflation.

The last increase was in June 2003.