Next Level: Nigeria to Introduce Toll Gates

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The Federal Government said it will introduce toll plazas on federal roads across the country.

The Minister of Works and Housing, Babatunde Fashola revealed this on Wednesday in Abuja when he addressed newsmen after the Federal Executive Council (FEC) Meeting.

“Where are we in PPP (public-private partnership) and toll gate, 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 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 out 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.

“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” Fashola said.

Speaking further he said, “Now, Lagos/Ibadan, the heaviest traffic you will find is between Lagos and Shagamu, it is about 40,000 vehicles. After Shagamu, heading to Ibadan, 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, 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 on 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 begins 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. So, (we are) collecting information to know what to do with, which place and what.

“Going to PPP, I say that in the context people arrogate to PPPs 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  to the Executive Order 7 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 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 per cent. So, if you do that, it will be about N15 billion.

“Look at it that way, so how many companies are in that? A few banks, maybe,  Aliko and it is not a surprise, therefore, that the Dangote Group are the ones  building the Apapa/Oworisoki expressway using tax credit.”

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