Page 6 - Wealth-Adviser-Issue-124 (FWP)

ISSUE 124
NOVEMBER 2025

traps, where inability to afford tolls leads to fines and legal Conclusion
sanction.” Privatised toll roads have dramatically reshaped how
Beyond pure economics, this system shapes the very Australians travel, who pays for public works, and who
fabric of communities, warping incentives and exposing the benefits financially from essential infrastructure. While the
most vulnerable to disproportionate hardship—while private PPP model delivered rapid expansion of road networks and
road operators accrue record profits from a service that, in deferred government debt, it has often done so at the cost
theory, is a basic public good. of transparency, equity, and even basic financial prudence.
As it stands, the true price of Australian toll roads is not
Reform and the Way Forward just measured in dollars at the tollgate, but in the unseen
Recognising the problems, many experts have proposed burdens carried by thousands of households, businesses,
a suite of reforms aimed at returning balance to the toll and communities across the country.
road system and reducing the social inequality it fuels. A fairer, more rational system is both possible and nec-
Among the most widely discussed is transparent, perfor- essary: one where public interest and community wellbeing
mance-based contract design. Firstlinks/Conversation are placed above corporate convenience. For retail investors,
advocates, “The first step towards fixing the system is fairer, policy-makers, and the everyday driver, asking “who really
more transparent contracts. Windfall profits ... should be pays the price?” is not merely academic—it’s the starting
capped, revenue-sharing with governments made standard, point for a new conversation about Australia’s infrastructure
and toll increases tied to performance rather than guaran- future.
teed indexations.”
Smarter pricing stands as another promising frontier.
Multiple studies, including those cited by Social Justice References
Australia, recommend a shift to distance-based and conges- • Private toll roads need a shake-up
tion-sensitive pricing models, reducing flat tolls in favour Milad Haghani & David A. Hensher, The Conversation/Firstlinks, 29
of charges that better reflect the cost and broader public October 2025
impact of car travel. “A network-wide distance-based charge • Why Are Toll Roads Private in Australia?
in Sydney—just a few cents per kilometre at peak times— Social Justice Australia, 1 May 2025
coupled with reduced registration fees could cut congestion • Public-Private Partnerships (PPPs) for civil engineering in Australia:
while raising billions,” suggests Firstlinks. Advantages and Disadvantages
The regulatory environment must also change. ConsultANZ, 11 March 2025
ConsultANZ’s commentary on PPPs stresses the need for • Sydney’s toll roads saga shows risks of contracted assets
independent, open oversight and stronger competition Infrastructure Investor, 17 July 2024
rules: “More robust regulatory frameworks can help ensure • Ready for road pricing reform? Identifying segments of drivers for
that private motives don’t override the public interest ... and congestion charges
that contracts are not simply rubber-stamped extensions of ScienceDirect, 2025
existing monopolies.” • Role of Road Pricing in the Australian Context
Additionally, Social Justice Australia points to the impor- Australasian Transport Research Forum, 2010
tance of reinvesting profits from tolls into transport equity, • 2023 Independent Toll Review
such as funding new public transport corridors, subsidising Infrastructure Partnerships Australia, September 2023
low-income users, and ensuring highway access does not • Would congestion pricing work in Australia?
reinforce spatial inequality. UNSW Newsroom, 23 January 2024
Above all, future infrastructure investment must be • Performance of PPPs and Traditional Procurement in Australia
grounded in a clear understanding that roads are public Infrastructure Partnerships Australia, December 2016
goods with wide-reaching implications for the nation’s • Mitigating risks in public–private partnerships
economic and social fabric. As one advocate powerfully put ANZSOG, 27 June 2023
it, “Our toll system should treat roads as public goods, not • Divestment - Case Studies Public Private Partnership
just investment vehicles.” World Bank, 30 April 2025

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