To drive fairness, Sydney’s road tolling reform must start now

From the private motorist listening to their e-tag go “beep” on the M4 at Parramatta to the boardrooms overlooking Sydney Harbour, few people have assumed the Sydney tolling system could ever be changed for the fairer.

Tolling contracts are, after all, the very definition of stitched up tight – the proverbial licence to print money.

NSW Roads Minister John Graham at Sydney’s Transport Management Centre.Credit: Nick Moir

This week we begin to challenge that assumption. We must start now or lose the chance until 2060.

This is a difficult area to achieve reform, but as the interim report of Allan Fels’ toll review lays out in more than 230 pages of detail, reform is necessary.

Fels and his co-reviewer David Cousins put it like this: “In the past, it has been suggested that reforms to road tolling are not possible given the nature of the concession agreements. We do not accept this. We do accept the proposition that the state needs to act responsibly in achieving reforms in this area and that the reasonable expectations of toll road operators need to be protected and honoured. Our overriding focus, however, is the public interest and toll reform is necessary in the public interest.”

I agree that reform is possible.

It must start now or risk creating a more divided city in which people are confined to their own corner of Sydney due to the prohibitive cost of just getting around.

It must start now or risk the cost of freight and congestion adding more pain to the cost of living.

I have spoken to teachers and carers who have changed where they work based on the need to avoid long, toll-pocked commutes from the outer suburbs.

The toll review provides hope that a simpler, fairer system for most users is possible. This is especially true for those people who can least afford it and who have the fewest options to catch public transport because of where they live.

Under one scenario modelled in the interim report, a five-day-a-week commuter from Hawkesbury area to the Sydney CBD could save almost $120 a week if a network-wide tolling system was implemented.

A commute from Marsden Park to the city would be $82 a week cheaper under the Fels model.

One thing I can’t promise is that every trip by every motorist would be cheaper under a network-wide tolling model. Under all options presented, the tolls on some journeys would rise to facilitate lower prices overall and to ensure the toll burden is shared more fairly than it is today.

We will take some time to reply to the review, but Premier Chris Minns has made it emphatically clear the M5 Cashback scheme will not be scrapped by the government.

It was Labor’s election promise to shine a light into the secret toll contracts signed in what appeared to be the dead of night by Liberals, and work towards a simpler, fairer system.

We have remarkable road infrastructure in Sydney, but we have paid a very high price for it. We still have $195 billion to pay.

Concession agreements struck decades ago embedded built-in rates of return regarded as “generous” by Fels. The solution proposed is to take toll setting out from individual concession agreements and move to a network-wide approach led by a new authority and with a role for the Independent Pricing and Regulatory Tribunal (IPART). The goal is to reduce toll prices over the long term for commuters who don’t have access to public transport.

The NSW government will take its time to work through the recommendations. But we will not be afraid to legislate to ensure a fairer system. I hope this is with the co-operation of the sector and toll road investors. The signs so far are good.

Whatever the case, we are willing to create a more equitable system.

If we don’t take this chance to reform tolls now we risk a more divided city, a more congested city, and a city in which the choice to travel on toll roads is as dependent on your postcode and your bank balance as your need to get somewhere.

John Graham is NSW Minister for Roads.

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