The Federal Government on
Wednesday said it plans to reintroduce toll plazas on its roads across the
country.
To reduce travel delays, cash
transactions will be minimised at the toll plazas, which will be built on at
least 10 lanes, Works and Housing Minister Babatunde Fashola (SAN), said on
Wednesday.
He said more land will be
acquired for the larger tolls gates.
Fashola said no law prohibits
tolling in Nigeria, adding that the new toll plazas will be built on
Public-Private Partnership (PPP) arrangements.
The Federal Executive Council
(FEC) on Wednesday approved additional N15.765 billion for Suleja-Minna-Lambata
road and Ibadan-Lagere-Ilesa bypass.
Fashola, accompanied by
Information, Culture and Tourism Minister Lai Mohammed, briefed State House
correspondents at the end of the FEC meeting, chaired by President Muhammadu
Buhari.
The former Lagos State Governor
said the Council approved the upward review of the road contracts from the
initial rates.
On the 101-kilometre
Suleja-Minna-Lambata road, the minister said FEC approved additional N12.6
billion; it granted additional N3.165 billion for the Ibadan-Lagere-Ilesa
bypass.
He said: “The first one is the
Ibadan-Ilesa bypass 22-kilometre road. The contract was awarded in 2010, but
there was no budgetary provision. The rates have become obsolete and the
contractor wants a new rate.
“So, that has necessitated a
revision of the rates by N3.165 billion. That means the old contract price of
N6.7 billion has now moved to N9.8 billion.
“The same is true of the
Suleja/Minna/Lambata Road. The entire road is 101 kilometres and it was awarded
in two phases.
“The first phase was awarded in
2010 for 40 kilometres. The second phase, covering Kilometre 40 to 101, was
awarded in March 2015, but they used the 2010 rates.
“The contractor is at a point
where he says those rates are not sustainable. He can’t continue and we have
recommended that the revised rates are considered and the Council approved
them. It’s a revision by addition of N12.6 billion. So, the contract price
moves from N23.6 billion N36.2 billion.
“It is important to emphasise
that all of these are in keeping first with the desire and determination to
focus on projects that can be completed rather than just starting new projects.
“Also, it is consistent with the
realities of economic rates, market price indices for road inputs like cement,
iron rods, diesel, petrol, lubricant and the changes that have taken place in
the national economic stage between 2010 and now.”
Stressing that no law opposes
toll plazas in the country, Fashola said the Federal Government was working on
modalities for reintroducing of cashless toll plazas.
He said: “Let me just clarify
this impression about toll gates. There is no reason why we cannot toll
motorists; there is no reason. There was a policy of the government to abolish
tolls, or as it were, dismantle toll plazas. But no law prohibits tolling in
Nigeria today.
“We expect to return toll plazas.
We have concluded the designs of what they will look like, what materials they
will be rebuilt with and what new considerations must go into them.
“What we are looking out for now
and trying to conclude is how the backend runs. And that is important because
we want to limit significantly, if not eliminate, cash at the plazas while ensuring
that electronic devices that are being used do not impede rapid movement.”
Speaking on other logistics,
Fashola said: “We are also now faced with the need to acquire more land to
establish the width of the toll plazas because I believe we are looking at
10-lane plazas so that there can be more outlets.
“So, we need to acquire more
land. That is the work that is currently being done.
“But let me also say that the
expectation that the collection of tolls will then produce the replacement cost
of the road is perhaps not accurate. This is because the traffic toll count
that we have done on major highways does not suggest that there is enough
vehicular traffic across all roads.
“The two or three heavy routes
are Lagos-Ibadan, Abuja-Kano and Abuja-Lokoja. Now, on the Lagos–Ibadan route,
the heaviest traffic you will find is between Lagos and Sagamu in Ogun State.
It is about 40,000 vehicles. After Sagamu, heading to Ibadan drops to about
20,000.
“So, most of it has gone
eastwards, going towards Ondo and Ore. By the time you get to Benin, the number
significantly drops.
“It goes up again at the
confluence where they are heading towards the Niger. So, you can see that it is
not a static 50,000 all the way; the same thing with Abuja, Kano and Zaria.
After Kaduna, the traffic significantly drops.
“It is about 40,000 there too but
after Kaduna, it begins to drop by the time you get to Zaria.
“If you have driven to that road
before, by the time you are driving between Zaria and Kaduna, you see how thin
the recurring number of vehicles you meet is and as you begin to head closer
between Kaduna and Abuja, the number of vehicles begins to increase.
“So, I think it is important to
have that at the back of your mind, not all roads have those traffic counts,”
he stated
He noted that what the government
was doing was not accidental but a deliberate and methodical action.
On Public-Private Partnership
(PPP), Fashola said: “Let me refer you to the Executive Order 7 that the
President signed on a tax credit for infrastructure.
“Essentially, that is another PPP
initiative where companies are supposed to invest their money in infrastructure
and then recover it from their tax payments.
“What people may not understand
is, first of all, the company has to make a profit before it can be taxed.
“So, when you have to build N50
billion highway, how many Nigerian companies are even doing a turnover of N50
billion in the private sector? How many are declaring profits of N50 billion?
The tax that you apply on N50 billion profit is 30 per cent. So if you do that,
it will be about N15 billion.
“Look at it that way. So, how
many companies are in that? A few banks maybe and perhaps Aliko (Dangote,
Chairman of Dangote Group) and it is no surprise therefore that the Dangote
Group is the one building the Apapa/Oworonsoki Expressway using the tax
credit.”
It was also disclosed that there
would be an extra-ordinary FEC meeting at the State House on Saturday by 11 am
to delibrate on the 2020 Budget.
The Peoples Democratic Party
(PDP) opposed plans to return toll gates.
The party lamented that the
“insensitive idea”, coming in amid economic hardship and high cost of living
“occasioned by the… policies of the Buhari administration”.
The party’s spokesman Kola
Ologbondiyan said at best, the idea amounted to “executive bullying”.
The statement said: “Only
recently, President Buhari approved the increase of Value Added Tax (VAT) from
five per cent to 7.2 per cent.
The PDP said instead of putting
more pressure on already impoverished Nigerians by introducing toll gates at
this point in time, President Buhari should exert himself, seek ways of
creating wealth out of the abundant resources at the disposal of his
administration or make haste to surrender the reign of governance to more
competent hands.
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