The public-private partnership for the Via do Infante A22 toll road across the Algarve has been re-negotiated, as has the deal for the A28 in the north of the country.
According to estimates from the Secretary of State for Transport, Sérgio Lemos, the savings will be €178 million over the life of these two contracts, for the Algarve's motorway this is until 2023.
The new deal with Euroscut will save €14.5 million a year. The saving, when added to savings from other concession deals that have been renegotiated, will save the taxpayer wasting €314 million over time.
Sérgio Lemos warned that the new arrangements had to be cleared by the European Investment Bank and the other financial institutions involved in the original deal, "The EIB and commercial banks need to approve the new package for the state.”
The minister hoped "quickly to obtain agreement from the banks and financial institutions so as to consolidate these budgetary savings."
The Via do Infante was largely built with EU funds but was renamed as a motorway. Later, Euroscut Algarve was given the concession to run it and charge tolls, thus causing most of the motorway traffic to use the now blighted EN 125 road.
The re-negotiated financial arrangements point to two situations. Either, the maintenance and cleaning work on the motorways will have to be reduced or, the contracts were so padded out in the first place that, even when they have been trimmed, there is sufficient profit for the concession holder still to make a good return.
The minister did not address the situation on the Via do Infante where the taxpayer covers the inevitable losses of the concession holder caused by sharply reduced traffic volumes, an estimated €40 million a year wasted by taxpayers and ending up at Ferrovial, a Spanish infrastructure company. This hardly follows the 'user pays' rule from the government. The user does pay and then the general taxpayer is forced into to paying an additional €40+ for each journey taken on the road.
In March 2014 the users committee, CUVI, summarised the affects of tolls on the Via do Infante, "tens of thousands of unemployed, hundreds of business failures, famine and poverty spreading like a snowball, daily traffic accidents on the EN 125 with injuries and fatalities over the past two years."
"Even with the tolls income, the pubic purse is experiencing a loss of tens of millions of euros transferred directly into the pockets of the concession holder. It is a ruinous PPP and must be annulled by the government," explains CUVI, referring to the estimated €40 million plus that the government pays out in support to the Spanish-owned concession holder every year in a deal that even for Portuguese standards, still ranks as probably the most incompetent every signed by a government minister.
This is such an appallingly bad deal for the taxpayer, and still such a cosy one for the concession holder where its income is guaranteed at pre-toll traffic levels, that the assumption is that it would cost more for the government to pay the concession holder to walk away than it does in current support fees.
Previous Ministers have played with taxpayers' money as if funds held by the state are not precious and owned by the taxpayer. The willfull disregard of its proper handling in case after case of these public-private partnerships leads to conclusions of corruption.
Certainly, while MPs and minsiters are able to carry out their public functions while sitting on the boards of commercial enterprises, such as road building and maintenance companies, any accusations of undue influence are accurate.
