PPP opposed to any toll increase at this time or any time in the future …Says almost 400 percent increase of rates not supported by contract

Oct 18, 2018 News

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By Kiana Wilburg
The proposed toll increases for the Berbice River Bridge is not only “unconscionable” but also, not in keeping with the Concession Agreement that was signed by the previous regime. As such, the People’s Progressive Party (PPP) says it is completely opposed to the proposed adjustments.
Making this declaration yesterday at his Church Street Office was Opposition Leader, Bharrat Jagdeo.
At his weekly meeting with members of the media fraternity, the former President said, “The PPP is opposed to any toll increase at this time or any time in the future. The increase is not part of the contract. I spoke of this in July last. We had issued a release at that time explaining the financial model, and nowhere in the model or the contract is this increase catered for. We believe that the government should release the contract and the financial model. Releasing the contract will not harm the financial interest of the investors in the bridge.”
Jagdeo added, “It would also do a lot to ensure transparency in Guyana and all Guyanese can see the toll schedule caters for minimal increases. They will see it is nothing of this magnitude.”
Further to this, the Opposition Leader said he was left confused when the government said that they would be seeking legal advice on the matter of the proposed rates and that all options would be explored to challenge it. Jagdeo said that he is left to wonder what political tactics the government is playing at, since there is one sure way to defeat the proposed rates.
The Opposition Leader revealed that in order for the rates to become law, the Minister has to sign a toll order. Therefore, Jagdeo said that all the Public Infrastructure Minister has to do is refuse to sign the toll order.
“The Berbice Bridge Act says that the Minister has to issue a toll order specifying the maximum toll at the bridge, so I see this as a campaign issue, given the fact that they are saying they will do all that it takes to fight the increases…All it takes or all they have to do is to not sign the toll order,’ the former Head of State expressed.
Jagdeo said that if the government colludes with the Berbice River Bridge Company to increase the rates, then once returned to office, he assured that the PPP would reverse it to the current rates.
Additionally, Jagdeo said that the financial model for the bridge does not cater for an almost 400 percent increase of the tolls. According to documents referenced by Jagdeo, (such as an extract of the Projected Toll Indexation and Real Toll Indexation), there is only a proposed six percent increase for 2014 and a 17 percent increase in the tolls for 2017. He explained that these “minimal” projections were made to cater for the debt repayment period that would be due at those times. The Opposition Leader also indicated that after that time period, the rates see a steep decline.
The Opposition Leader then reiterated that the proposed increases will only be possible with the involvement of the government.
He said, “So we are opposed to this. Financially, it can’t be justified and we know that this increase is not part of the contract we signed and we pointed that out to you. We believe that the Minister must release the contract… There is no secrecy about it.”
Jagdeo also urged Public Infrastructure Minister, David Patterson not to sign the toll order.
He concluded, “If they persist in this, we will reverse it.”
PROPOSED RATES
On Tuesday, the Berbice Bridge Company Inc. (BBCI) found itself in a standoff with the coalition administration since it intends to impose an almost 400 percent increase of the tolls. It wants these increases to come into effect from November 12, 2018, the same day Local Government Elections are being held.
But Public Infrastructure Minister David Patterson made it clear to the media that the Government will not be approving the increases. He said that the Attorney General’s Chamber will be consulted on the matter.
During a press conference on Tuesday at the National Communication Network (NCN), BBCI Chairman, Dr. Surendra Persaud, insisted that the bridge company has rights under the current agreement with Government to increase the tolls.
With regards to losses, the Chairman said that these were accumulatively in excess of $2.8B.
No dividends have been paid to ordinary shareholders – the company is now in default of obligations to its numerous stakeholders, including the NIS.
Dr. Persaud is also the chairman of the NIS. In this regard, he said, “It is important that we understand that the NIS investment in the bridge represents an investment of all contributors to the scheme, without exception, past, present and future. These investments by the private companies have now been flagged by their respective auditors and regulators as impaired.”
Persaud also denied the view that the adjustment in tolls will benefit the shareholders.
“Since no adjustment was ever made, no surpluses have been earned, resulting in the required adjustments to the toll being compounded. Ladies and Gentlemen, There is a contract, there is an established formula within that contract and there are obligations to be met,” Persaud said.

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