Toll operator underpaid State by €2m

The company running the Westlink toll bridge underpaid the state by €2m in toll revenue for two successive years, it emerged tonight.

The shortfall was not picked up by the state, the National Roads Authority, or the auditors for National Toll Roads (NTR) – the private company that runs the Westlink toll bridge.

Following the imposition of VAT on toll charges in 2001, NTR was supposed to consider compensation payments worth €6.4m made by the state to be part of its gross revenue.

But it failed to do so in 2002 and 2003, resulting in the state losing out on €2m in revenue.

NTR have accepted that an underpayment has occurred and have undertaken to immediately repay the money.

The company has grossed around €310m in revenue since the West-Link toll bridge opened in 1990 and the State has received €79m of this under a toll sharing agreement.

Independent Senator Shane Ross said it was very difficult to understand how the shortfall had been missed by auditors in 2002 and 2003.

“It was only one of the CAG’s staff who actually spotted it and when he spotted it, NTR came out with their hands up. If, and it’s a feather in the cap of the CAG, if he hadn’t spotted this, the taxpayer would have been out by €2m to NTR,” he told RTÉ radio.

The CAG report found that although toll charges on the Westlink bridge rise broadly in line with inflation, there is no mechanism in the agreement with NTR to reduce toll charges if volumes exceed the traffic estimates.

In 2004, the traffic volume was over 2.5 times the original estimate, with over 84,000 vehicles using the toll bridge each day.

“The increase in the volumes above the original estimates resulted in additional costs to users of €350m in 2004 values giving a higher return to the operator as well as increasing the amount of revenue accruing to the state,” the report said.

NTR’s return on investment has risen from 18% to 24% mainly due to increased volumes of traffic. This is two and a half times higher than initially estimated.

However, the State recoups 52% of all gross toll receipts, between corporation tax, municipal rates and income tax.