PSC Trade Sub-Committee Chairman Ramesh Dookhoo

Lowering Berbice Bridge tolls….

– Private Sector happy Public Private Partnership not violated

Stakeholders have welcomed government’s proposal to reduce the tolls to cross the Berbice River Bridge using a government subsidy as opposed to what it had originally intended to do, which was to unilaterally breach a contract with the Berbice Bridge Company Incorporated (BBCI) thereby undermining the strategic importance of public/private partnerships in the country’s development.

The then People’s Progressive Party Civic (PPP/C) administration had opposed a motion in the 10th Parliament for a reduction in the tolls because both the A Partnership for National Unity (APNU) and the Alliance For Change (AFC) were insisting that government simply demand  the Bridge Company amend its toll fee structure, ignoring all arrangements provided for in the contract.  The two parties opposition eventually passed their motion because of their majority in the Assembly, but the then PPP overnment refused to go along with the obvious authoritarian measure that would vitiate the cardinal principle of the free enterprise system – the sanctity of contracts.

Daizal Samad

At the time the PSC strongly supported the PPPC’s stance since they understood  that a breach of the terms of the Public Private Partnership (PPP) financial arrangement would send the absolute wrong signal to the international financial institutions and investors vitally necessary for Guyana’s development.

But even during the subsequent elections campaign, the APNU/AFC coalition gave the impression that it would still take a unilateral approach in reducing the tolls, saying that “we will be the government” and therefore, will have the power to effect whatever change they wanted.  It made the lowering of the Berbridge Tolls the 1st of 21 promises they expected to complete in their first 100 days in office.

But on Thursday, Governance Minister Raphael Trotman  made a  welcome statement signaling  the Government’s intention to pursue a more realistic route towards lowering the tolls, which was consistent with Finance Minister Winston Jordan’s earlier hint that cabinet will not tamper or breach public-private investments and partnerships.

 “Government has no intention of interfering with the Company’s right to a rate of fare or rate of returns on their investment… however; we have heard the cries of the people of Regions Six and Five in particular and we must act on their behalf”.

All Guyanese will benefit from the Berbice River Bridge toll reduction

Minister Trotman explained that while existing legislation pronounces on the setting of fares, a subsidy by the Government to ensure fares are lowered is an alternative that the Administration will explore.

Stakeholders are now relieved that government will engage in discussions with the Bridge Company and propose the idea of providing subsidies to ensure the fees structure is adjusted to benefit commuters. Even though the Berbice Bridge generates $1.5 Billion annually, the shareholders owning the Bridge have never been paid any dividends on their massive investment. They appear to have made their investment as a matter of patriotism and at least one of those investors have hinted that maybe the government should buy out its shares.

Almost every major financial institution in Guyana has a financial stake in the Berbice Bridge primarily through bonds, and any interruption of those fixed payments could have disastrous effects as the disruptions ripple through the economy.

Chairperson of the Private Sector Commission’s sub-committee on trade, Ramesh Dookhoo, who was once PSC Chairman, in an invited comment, said the Private Sector welcomed the move, as it would benefit not only Berbicians but all Guyanese.

“We were particularly concerned about the investment of the Private Sector in the Bridge because you know the Bridge represents a pioneering Public Private Partnership investment … So we are happy for this and I believe the Berbice people have made a huge plea and cry for the reduction of the toll and so as long as that subsidy is there and the Bridge can use that subsidy to stay afloat, we won’t have a problem with that,” he said.

Dookhoo added that “it was our original solution to the problem, we said that the investors shouldn’t be allowed to suffer and if it is done, subsidies should be put in place … using taxpayers money is a broader base and that broader base is being used to subsidise a smaller base which is the people who use the bridge.” minister Ttitman had pointed out that the subsidy would directly benefit some 60,000 Berbice commuters.

Dookhoo highlighted that it was not uncommon for Governments to provide subsidies to assist in situations that affected nations.

“We subsidise so many things; in Trinidad and Tobago the total transfer of subsidies is $40 million so I believe a government can either decide to subsidise a part of the population because of a particular issue or decide on behalf of a few investors, in this case, the investors won’t lose and in case of the populace that is affected, it will impact them positively,” he explained, adding that “over a long period, because of the volume of people crossing the bridge, it will even out”.

View from Berbice

Also, Professor Daizal Samad, who had supported the AFC during the elections campaign, said he was in complete agreement with Government’s plan to subsidise the Bridge Crossing.

“Any counter argument does not, to me, hold water because Berbice is an essential agri-area and the more we pay for bridge crossing, the more we pay for goods, greens and so on, and this disadvantages everybody, it is not just a ‘small’ population of Berbice, it affects everybody,” he stated firmly.

Samad noted that the lowering of the bridge toll would impact the agriculture sector, education sector and the health sector, among others.

“What happens if you have the bridge crossing and let’s say we’re taking plantains or bananas across, the price immediately goes up, so everybody pays for it…,” he reasoned.

With regard to health-care, Samad pointed out that persons often travel from Region Five to New Amsterdam Hospital and would have to use the Bridge and, therefore, a toll reduction would benefit them.

In the area of education, Samad said children in Region Five use the Bridge on a daily basis to attend schools in Region Six and therefore, a toll reduction would help families save heavily.

“The lowering of the Bridge toll makes sense, it makes financial sense and it makes building human capacity sense,” he maintained, noting that one cannot simply measure the importance of the Berbice region in terms of population density.

Guyana Times had also spoken to the Chairman of the Berbice Chamber of Industry and Commerce (BCCI) Rajnauth Ramroop who said the reduction of the tolls “will affect the Berbice region in a positive way. We have been calling for a reduction in the tolls for a long time and we welcome the move. It is not safe for us in the region to be paying so much when the Demerara [Harbour] Bridge is not even so much.”

Since the construction of the Berbice River Bridge, commuters specifically from Region Five (Mahaica-Berbice) and Region Six (East Berbice-Corentyne) have bemoaned the fees structure and have since been calling on Government to lower the tolls

Now that the government will engage the BCCI in discussions, presumably on the modalities of passing through their subsidy to the commuters, it is expected as promised, the exact proposed reductions of  tolls will be adumbrated during the Budget presentation.

In the 10th Parliament, now Minister of State, Joseph Harmon in the motion adverted to above, had  proposed a reduction in rates for large trucks from $13,600 to $10,000; 50-seater buses from $12,800 to $9000; 30-seater buses from $7200 to $6000; four-wheel drive/SUVs/Pick-Ups from $4000 to $3000; SUVs and pick-ups pulling a boat for recreational activities from $4000 to $3000; four-wheel drive SUVs and pickups pulling horse buggies from $4000 to $3000; four-wheel drive/SUVs/pick-ups transporting BBQ Grills and coolers from $4000 to $3000; motor cars from $2200 to $1000; minibuses from $2200 to $1000; and motorcycles to be free.