NSW government’s interim report on Sydney’s toll road network would use a ‘declining distance-based rate’ of tolling
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Elias Visontay Transport and urban affairs reporter
Sydneysiders driving across the Sydney Harbour Bridge and tunnel should be forced to pay fees in both directions, a review into the city’s patchwork toll road network has recommended, alongside a vision to unify all paid roads under a consistent “declining distance-based rate” of tolling.
On Monday, the New South Wales government released the interim report of its review into Sydney’s toll road network, which has recommended changes to achieve a “reset” of the network, which would have the effect of spreading the city’s toll burden – estimated to cost drivers $123bn over the next 37 years – predominantly from the west to the eastern and northern suburbs.
NSW premier Chris Minns, who came to power in 2022 after campaigning on ending “tollmania”, said the government is considering the “bold options” recommended by the review, but that “it will take some time” to determine his administration’s “roadmap to a clearer, more equitable tolling system”. Current toll relief schemes will remain in place in the interim.
Distance-based tolling ‘network’
A key recommendation is for the establishment of a state “TollCo” – a new body “to take back control of tolls”.
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The new TollCo, as recommended by the review authors – former competition watchdog chair Allan Fels and David Cousins – would be able to provide authority for a system of network tolls, while taking into consideration the array of individual tolling contracts with private owners so that third parties’ minimum revenues are still met.
The proposed declining distance-based rate of charging would mean a fairer and simpler system, Fels said.
Fels gave an example of how such a structure could work; suggesting that for the first 5km of a toll road, drivers could be charged $1 for each kilometre travelled, 80c per kilometre between 5-10km, and then 60c per kilometre for 10-15km.
The review also recommended tolling drivers on the Sydney Harbour Bridge and tunnel, as well as the Eastern Distributor, in both directions – they are currently only charged in one direction.
Cousins said the effective price paid by drivers taking a return trip on these toll roads should be more than the current one way toll but less than a doubling of the charge.
Fels also said it would be “logical” to introduce the same tolling scheme for the future western harbour tunnel to open in coming years.
Crossing Sydney harbour would also attract an “infrastructure charge” in addition to the new network and declining distance charge approach.
The increases to tolling revenues those measures would drivewould fund the proposed decreases to higher tolls that motorists elsewhere in Sydney currently face. Introducing off peak tolling rates across the network could also incentivise extra tolled trips during quieter periods to help raise more revenue and offset what will become cheaper trips elsewhere.
“[In] the west where people are traveling longer distances, have fewer alternatives, public transport, and more difficult socio-economic circumstances often, we want to see some reduction in tolls. And the fact is, if it’s going to all happen within the same revenue envelope, we’re going to have to see some increases in tolls elsewhere,” Cousins said.
Transurban
Across the city, there are 13 roads over 179km with tolled sections, which has led to claims that is Sydney is the most tolled capital city in the world. All but two of the toll roads are run by private operator Transurban as part of an array of long-term agreements which stipulate minimum guaranteed revenue.
Sydney’s toll roads have several different pricing structures – some charge a fixed fee, others charge for the distance travelled while, for another road, users pay an access fee as well as for the distance travelled. There are also roads where users are charged differently depending on the time of day or day of the week and some roads only toll users in one direction.
Fels, who revealed the interim report on Monday, said “tolls need a big shakeup”.
“No holds barred,” Fels said. “The longer that a motorist drives, the less cost per kilometre, which is fairer.”
The review also recommended for Ipart to set the tolling settings in the future, reductions for mid-sized trucks to tackle the issue of trucks avoiding toll roads and damaging local roads, and cheaper tolls for motorcycles and towed recreational vehicles.
Fels said the current tolling system was unfair and “clogging up” free roads. Analysis in the review also found that while toll roads were meant to alleviate pressure on existing free to access arterial roads, many drivers avoid the paid roads.
“The problem needs to be tackled seriously and systematically,” Fels said.
Fels and Cousins’ vision for the toll regime overhaul is staged in three phases.
After the initial step of introducing the network wide declining distance based charge, the review set out a second phase, which recommends the future TollCo attempt to find efficiencies such as ways to bring down operational costs and driving competition to reduce toll charges.
The third phase of the reforms would include removing tolls from some roads if the government had the financial capacity, and potentially incorporating currently untolled motorways into the tolling network – though the review noted this ran contrary to the government’s election commitment of no new toll roads.
Fels said that to achieve the initial phase of introducing the new network based tolling approach, the government would need to negotiate with Transurban. To avoid potential litigation, the report recommended legislating the changes.
Asked about the likelihood of Transurban agreeing to reforms that see it worse off financially, Fels suggested the government could negotiate with the tolling giant based on modelling showing falling patronage of their roads. However, Fels didn’t rule out that the reforms may see Transurban paid some form of compensation.
‘Tollmania’
The review also revealed analysis that drivers will spend $123bn on toll roads measured in 2023 dollars over the next 37 years. The Minns government has blamed the former Coalition government for the state of “tollmania”.
Driving the mammoth spend on tolls is the privately owned WestConnex project, the final stage of which included the Rozelle Interchange, which caused traffic chaos when it opened late last year.
Of the $123bn toll spend by 2060, 52% of this amount will be spent on WestConnex. Over the next 37 years, Sydneysiders will have paid for the construction cost of the entire WestConnex project three times over.
The report also conducted a review of 1,500 drivers across Sydney which found that 87% felt tolls were too high, and 70% felt toll prices were unfair.
Harri Bancroft, mobility policy manager at the Committee for Sydney thinktank, welcomed the proposal of a coordinated network and both-directional charges for the Sydney Harbour crossing as a way to make tolling fairer and reduce traffic. However Bancroft warned without larger scale road network reform, reducing tolls in some part of the city could encourage more car trips and subsequent traffic.
The opposition’s treasury spokesperson, Damien Tudehope, said if tolls were implemented in both directions on the Harbour crossings and Eastern Distributor it would mean Labor had broken an election promise.
“They did not rule out these new tolls and higher tolls today. They should have come out and ruled it out – if they were proposing to do that,” he told reporters.
Additional reporting: Catie McLeod