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New magic? Government's long running headache of manning road toll stations

BUSINESS
By Macharia Kamau | January 8th 2017
The country is set to see a return of road tolls. The Ministry of Transport has for years been toying with the idea since the Thika Super Highway was completed, which has had the Ministry and the Kenya National Highways Authority (KeNHA) decry the high cost of maintenance and has hinted at tolling the road.PHOTO: COURTESY

On the afternoon of Friday June 26, 1970, nine days after then Finance Minister Mwai Kibaki had read his first budget speech and Parliament was debating it, one member suggested that the minister should have introduced road tolls along major roads.

This, he argued, would help the Government raise money to maintain and repair roads. The MP, named by the Kenya National Assembly Official Record (Hansard) as S M Kivuitu, noted that Kenyans who own cars were people of means and were making money travelling on the roads and hence should chip in the repair.

“I believe that those who own motor vehicles, including honourable Members of Parliament, are well-to-do people and they should help the country by contributing towards maintenance of the roads. That is why I was expecting the Government to introduce road toll... on trunk roads, like Mombasa/Nairobi road, which are mostly used by the rich,” Mr Kivuitu told the House.

“These people who use tankers, have big lorries... these people should be taxed. One of the ways of taxing these people is by introducing a road toll so that whenever a man travels from here to Mombasa he will pay some money at a certain barrier towards the maintenance of roads.”

It was probably an argument a bit heavy for an afternoon as the MPs present did not follow up with any supporting or opposing arguments, as per the Hansard. In 1984, the National Assembly passed the Public Roads Toll Act that heralded the setting up of toll stations.

And since then, up until 1999 when the stations were abolished, the issues of raising money for road maintenance as well as double taxation and the modalities of operating road tolls always cropped up during debates on road tolling in and outside Parliament.

COSTLY INCONVENIENCE

In 1985, shortly after the Government started implementing the road tolling project after the 1984 Act, a toll station that had been set up in Athi River had to be moved. This followed lobbying among industries based in the area, which argued the station was pushing up their cost of doing business.

“When the collection of toll fees commenced at the Athi River Toll station, a number of members in this House expressed concern of likely rise in production costs that would be brought about by the road toll for industries situated at Athi River... the Government consequently agreed to move the location of the Athi River Toll Station to a location between Machakos turn-off and Uku,” J M Keriri the then Assistant Minister for Transport and Communication told Parliament in June 1985.

The late Kijana Wamalwa noted how a road toll set up on the outskirts of Kitale had become a costly inconvenience for the residents, restricting movement even when they had to seek essential services.

“Some of these toll stations were so badly placed that they became a traffic burden upon the residents of the area. In Kitale, for example, just nine kilometres outside town, there is a toll station. It means that a farmer who lives in Kiminini, which is only about 15km, has to pay the Sh10 each time he goes to town,” Wamalwa told Parliament in 1993.

“If he has to go back to town in the evening, maybe for a meeting, he has to pay again. If his cow falls sick and he has to call a veterinary officer, he must pay again.”

In 1999, the road tolls were abolished and replaced with the Road Maintenance Levy. The levy is appended to the retail price of super petrol and diesel and today, motorists pay Sh18 per litre at the pump that goes to Road Maintenance Levy Fund. This is managed by the Kenya Roads Board, which disburses the money to different road agencies for repair and maintenance.

The country is set to see a return of road tolls. The Ministry of Transport has for years been toying with the idea since the Thika Super Highway was completed, which has had the Ministry and the Kenya National Highways Authority (KeNHA) decry the high cost of maintenance and has hinted at tolling the road.

Last year, the conversation on tolling roads intensified. The Government announced the five road projects that it plans to toll and even commenced the search of a contractor who will operate a toll station along the Nairobi Southern Bypass as well as build and operate the road between Nairobi and Mau Summit.

The arguments today for and against road tolling are not much different from the debates that the country has had since the post independent years.

The Ministry of Transport has said the move is aimed at raising money for the maintenance of roads. At the moment, according to the Ministry, the money allocated by the Treasury and that collected through the Road Maintenance Levy is not enough to undertake construction and repair of roads in the country.

Infrastructure Principal Secretary John Mosonik said the tolling, which will be undertaken in a Public Private Partnership (PPP), would help increase investments in road infrastructure that has over the years not kept up with demand.

“If we sit back and depend on the money allocated by the National Treasury, it means that we might not develop or maintain any roads. We must expedite road infrastructure development and this why we are bringing on board private sector players,” he said.

“If you look at the budget allocated to roads infrastructure projects, we have about Sh140 billion. The total revenue from fuel levy is about Sh50 billion and this is strictly for maintenance. We need more than Sh400 billion every year for the construction and maintenance of roads.”

The proposal has not gone down with consumer lobbies that have argued that the move would amount to multiple taxation.

The Consumer Federation of Kenya (Cofek) notes that Kenyans are already financing road construction through taxes as well as repair works through conventional taxes as well as the Road Maintenance Levy.

Stephen Mutoro Secretary Cofek said the ministry needed to resolve many issues before starting implementation of the road tolling project. This, he notes would enable it avoid the failures experienced in implementing road tolls in the past that eventually led to their abolishment.

“We are not totally opposed to tolling and KeNHA and the ministry have shown interest in engaging other stakeholders and we are waiting for them to begin the consultations,” he said.

“But we want the ministry to be clear on such issues as double taxation, the computation of the cost that will be paid by motorists and the procedure of recruiting the contractor that will operate and maintain the roads,” he added.

“We are also of the view that the Ministry should first undertake a pilot which will inform other toad tolling projects as opposed to the head on approach that it has taken.”

He also noted that projects that have already been built should not be subject to tolling as they have been built.

“Some of the projects they are proposing to have road tolls have been built using taxpayers money and these should not be subjected to PPP. This is money that has already been spent and is being repaid using taxpayers money,” he said.

THE CHALLENGE

Motorists Association of Kenya chairman Peter Murima claimed the Ministry was moving ahead to implement the project without proper consultations. He added that there are adequate resources to build and maintain roads in the country.

“The money that we pay in taxes, including the Road Maintenance Levy, is enough to undertake repair and maintenance of existing roads,” said Murima.

“The challenge that we have is corruption where through the PPPs, private contractors have inflated the cost of road repair works. They are also doing shoddy work such that the roads are always in need of repair and hence they are always in business.”

The projects earmarked for tolling are Nairobi-Mombasa; Second Nyali bridge that will connect Mombasa Island to the mainland; the Nairobi Mau Summit Road; the Nairobi Southern Bypass; and Thika Superhighway. The new projects are projected to cost of Sh320 billion, with maintenance leases running between 10 and 30 years for the different projects.

The Government in November started looking for a firm that will rehabilitate, expand and later maintain the Nairobi-Nakuru-Mau Summit road. The firm will also operate and maintain the Nairobi Southern Bypass.

KeNHA said the company will be tasked with expanding the 175 km highway between Rironi and Mau Summit to a four Lane dual carriageway, the strengthening of the 57.8 km between Rironi and Naivasha, and operation and maintenance of the 12.43 km of highway between Gitaru and Rironi and the 28.6 km of Nairobi Southern Bypass.

 

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