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Who's counting the cash at our turnpikes?

By Ma Hongman (China Daily)
Updated: 2009-05-09 07:42

As many as 12 provinces have now made all grade-two highways, built with government loans, toll free.

Altogether, 1,263 toll stations, which make up 65 percent of the total on the country's grade-two highways, have shut operations.

This is a positive change. However, the systemic problems have not vanished because of the move.

The idea of toll-free grade-two highways emerged from the same document that suggested the idea of fuel tax.

It's weird that about 30 percent of the remaining grade-two highways still collect tolls even almost half a year after the document came into effect.

It wouldn't be too tough had there been plenty of funds.

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According to policies, the central and the local government will equally share the burden of debt when the toll stations are closed down. Therefore, the key to cancel tolls is to guarantee reserve funds. That is where the rub is.

The funds can eventually repay the loans. However, there are signs to indicate that toll collection in order to payback loans is just an excuse in many regions. The public is losing money, and the money is not well spent.

The root of the problem of toll collection on grade-two highways is the very excuse: Due to the shortage of construction funds, the government permits highway construction enterprises to acquire capital through loans. After the highways are built, the tolls collected on the roads go toward repaying the loans.

The problem is, there is hardly any strict supervision to ensure toll fees is used to repay loans.

Take Shanxi province for example. More than 90 percent of the grade-two highways in the province have extended toll-charging periods. The best reason for toll stations to continue collecting fees to pass through is that "there are still some loans to clear off".

You can't help but wonder when these monthly installments will ever see an end.

Take the toll station of Fenhe River Bridge. The amount of bank loan for its construction is only 7.26 million yuan. In 2004, six years after the toll-gate was built, tolls collected have already amounted to 13.17 million yuan.

Although the revenue was sufficient to pay off the entire debt, the constructor only repaid 300,000 yuan to the bank, which is 2.3 percent of the total loan. They continue to collect tolls because there is still 97.7 percent left to repay.

Haste makes waste. It is the lack of supervision and legal punishment that has helped these toll stations, which should have shut down long back, keep their shutters up.

It is understandable for the public to want these highways to be toll-free. But if we simply allocate funds, without really solving the pressing systemic problems, we'd still be cheating the country's taxpayers.

More than the elimination of tolls, the system should be improved.

Collecting tolls to repay loans is a worldwide universal model for the construction of infrastructure; it is only made the scapegoat in local operation.

If the model can be strictly supervised and implemented, and toll stations can be closed down when the legal term expires, there won't be arbitrary charges on the turnpikes at all. What's more, the public will not oppose the tolls on grade-two highways so strongly.

We are happy that gradually the system of collecting tolls on grade-two highways is becoming history. But we should slow down. It will help us expose certain illegal practices.

The author is an anchorman with China Business Network, a TV network based in Shanghai