Editorial | Toll rates and more

Jerome Powell, the chief executive officer of the Toll Authority of Jamaica, which regulates the island’s toll roads, has recently been effusive about the alacrity with which the operator of the north-south leg of Highway 2000 responded to the authority’s intervention to lift service standards.

This newspaper is happy about that and hopes that Mr Powell’s declaration marks a new era of transparency in the authority’s operation, including genuine dialogue with the public over rates and other matters. Perhaps then the authority and consumers will be on the same page on critical issues of service delivery.

Two things happened, or are happening, this week, with respect to the tolled highways – the east-west corridor controlled by Trans-Jamaica Highway, and the north-segment, between Caymanas and Mammee Bay/Ocho Rios, owned Jamaica North-South Highway Company (JNSHC).

First, Trudy-Ann Williams, JNSHC’s commercial manager, spoke glowingly of the fact that since the beginning of August debit and credit can be used for paying the toll on this road.

Addressing the same issue to staff of the government’s Jamaica Information Service (JIS), to whom they spoke, Mr Powell celebrated that this happened in six months, between the authority’s intervention and implementation.

“As a regulator, this is what we want to have – to have dialogue with our concessionaires and see the follow through that results in an improved value proposition,” he said.

FURTHER INTERROGATION

That’s the correct principle. But the observation needs further interrogation.

The second development is that new toll rates, barring delays, are supposed to come into force today. The cost of using the highway, depending on entry/exit points, will, at a glance, increase between three and 10 per cent. Unfortunately, there has been no significant opportunity for the public, especially people with expertise to untangle these issues, to weigh in on the new rates, or debate the existing basis on which they are determined. This is a matter this newspaper has raised on several occasions.

It was only a week ago that the toll regulator published the proposed new rates and invited public response to them. It however gave people very little time to do so.

Regarding the use of debit and credit cards on the north-south leg of the highway (it was introduced on the east-west corridor a year ago) as indicative of the authority pursuing good public policy, the answer is obviously yes. We doubt, though, that Lisa Hanna, the former legislator and Cabinet minister and political party leadership aspirant, would agree about speed.

In 2017, Ms Hanna, a member of parliament, was caught out by the cash-only system on the highway. She was completing a J$2,450 journey when, at a toll booth, she discovered she was short of cash - J$450. She had multiple debit and credit cards, but had to wait for someone to drive many miles from Kington to her rescue. It is eight years since that incident publicly highlighted this shortcoming and for it to be fully resolved.

It is a legitimate question why the Toll Authority allowed it to do so long and whether the cash-only system impeded efficiency and imposed higher transaction costs that were borne by consumers.

NO JUDGEMENT

The Gleaner makes no judgement about the new toll rates, especially in the absence of the underlying data, including costs and weighted revenues of the companies - especially of the JNSHC’s, a private company, whose accounts aren’t published. We appreciate, too, that there are specific formulas in the concession agreements, covering matters such as return on investment, the cost of debt, the exchange rate of the Jamaican dollar and domestic inflation, to determine adjustments to the tolls. So, consumers perhaps ‘benefited’ from the relatively stable exchange rate and the softening of Jamaica’s inflation over the past year.

Nonetheless, consumers remain largely in the dark on the specifics of the determinations by the toll regulator. In that regard, we again urge that the regulator adopts a robustly transparent approach to its rate-setting, including genuinely attempting to get feedback to proposed rates.

Additionally, the Toll Authority, as this newspaper previously suggested, whether the highways, especially the north-south corridor, are fulfilling their intended mission of expanding communication and reducing transaction costs in the economy.

Such a study should also review the vehicle pricing bands employed by the companies, to determine whether their increase would encourage more traffic on the highways, with greater affordability to commuters and increased profits to concessionaires. This would probably also mean a voluntary renegotiation of elements of the concession agreements.