E-tolls consultations start today (and academic economists also have an opinion) Reply

etollsA month-long process of consultations about the Gauteng Freeway Improvement Project and e-tolls starts today. Everyone will be making presentations, from labour to business, to civil society organisations, and the economic, social and environmental impacts will be discussed. From this blog, we thought that we would chip in on behalf of academic economists.

We have made a couple of posts before and again want to present the case for congestion charging:

  • If people receive benefits from nice freeways (like lower vehicle maintenance costs and shorter commuting times), they should pay for them.
  • Exemptions can be used to mitigate some of the impacts of the user pays principle on the poor – and if you own a car and drive on freeways in Gauteng, you are not “the poor”.
  • And increase in the fuel levy is a regressive tax that would hurt the actual poor all over the country so that the rich can drive on nice freeways in Gauteng.

It is at this implementation level where the battles should be fought. We need more information about the costs of the project, how prices are set and about who will be making money from this (since it is a public good, costs should be low and no-one should be making large profits). But there has not been enough transparency in this regard. With good governance, everyone should happily be paying their bit.

Just read the whole post, I think it is a good one.

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