Eighteen years after it dismantled toll plazas across the country and aborted tolling on Nigerian highways, the federal government, Wednesday announced fresh plans to restore the system nationwide.
Fielding questions from journalists at the end of the weekly Federal Executive Council (FEC) meeting in the State House, Abuja, the Minister of Works and Housing, Mr. Babatunde Fashola, said the country was returning to tolling on the highway because there is no law prohibiting it from doing so.
According to him, the designs for the new toll plazas had been concluded, and materials to be used for the construction factored into the designs as well as every necessary consideration about the plan.
Fashola disclosed that currently being examined is the method of banking transactions, explaining that toll transactions at the plazas would be largely done electronically as the aim is to limit cash transactions.
He also said the government was looking into how the electronic transactions would be done without impeding vehicular movement, adding that the government is also confronted with the challenge of acquiring more land to accommodate the 10-lane plaza plan.
"Let me just clarify this impression about toll gates. There is no reason why we cannot toll, there is no reason. There was a policy of the government to abolish tolls or as it were, dismantle toll plazas but there is no law that prohibits tolling in Nigeria today.
"We expect to return toll plazas. We have concluded their designs of what they will look like, what material they will be rebuilt with, what new considerations must go into them. What we are looking at now and trying to conclude is how the bank end runs.
" And that is important because we want to limit significantly, if not totally eliminate cash at the plazas while ensuring that electronic devices that are being used do not impede rapid movement.
"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 now," he said.
The minister was however, quick to explain that the assumption that money used for construction could be recovered through tolling was not realistic because a survey carried out on major highways showed that vehicles transiting on the roads are not enough to recoup the cost of construction.
To buttress this, he cited the Lagos-Ibadan highway, Abuja-Kano expressway and Abuja-Lokoja road which are the busiest roads.
"But let me also say that the expectation that collection of tolls will then produce the replacement cost of the road is perhaps not accurate 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 the Lagos-Ibadan, Abuja-Kano, Abuja-Lokoja. Now, on Lagos - Ibadan expressway, the heaviest traffic you will find is between Lagos and Shagamu. It is about 40,000 vehicles. After Shagamu, heading to Ibadan, it drops to about 20,000. So, most of it has gone eastward, going towards Ondo and Ore and 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. Same thing with Abuja-Kano-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 begin to increase.
"So, I think it is important to have that at the back of your mind, not all roads have those traffic counts. I also want to let you know that what we are doing is not accidental. We are being deliberate and methodical - collecting information to know what to do with which place and what," he explained.
Fashola also responded to a question on how the private-public partnership (PPP) could be explored to assist the government in the construction and maintenance of roads.
He recalled the recent signing of Executive Order Seven by President Muhammadu Buhari on PPP arrangements in such a way that companies which offer to partner with the federal government on road construction will enjoy 30 per cent tax relief.
According to him, only very few companies can embrace that initiative because the cost of construction is relatively high when compared to the profit accruable to most companies.
He said only companies like Dangote Group, which he said is currently reconstructing Apapa-Oworonshoki expressway can dare to undertake such ventures.
He said: "Going to PPP, I say that in the context of people arrogating PPPs to the right to toll, no government can also toll. That is the point and that will happen without taking private sector fund.
"Let me refer you back to the Executive Order Seven that the president signed on tax credit for infrastructure. Essentially, that is another PPP initiative where companies are supposed to invest their money in infrastructure and then recover it back from their tax payments.
"What people may not understand is, first of all, the company has to make profit before it can be taxed. So, when you have to build a N50 billion highway, how many Nigerian companies are even doing turnover of N50 billion in the private sector? How many are declaring profits of N50 billion and the tax that you apply on N50 billion profit is 30 percent. So, if you do that, it will be about N15 billion.
"Look at it that way. So, how many companies are in that category? A few banks maybe and perhaps Aliko Dangote and it is surprised therefore that the Dangote group is the one building the Apapa-Oworonshoki express way using tax credit," he said.
Earlier, Fashola disclosed that FEC approved an upward review of contract sum for the construction of 22 kilometre-Ibadan - Abere-Ilesha road from N6.7 billion to N9.8 billion.
He also said the council simultaneously approved an upward review of Suleja-Alanbata road awarded in two phases in 2012 and 2015 respectively from N23.6 billion to N36.2 billion.
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