The electronic toll collection (ETC) system on national highways has become an embarrassment. In a little more than a week after its launch, the system has been plagued with problems: from double charging to the hacking of the ETC system’s Web site and mobile phone application.
Minister of Transportation and Communications Yeh Kuan-shih (葉匡時) on Friday demanded that the system contractor, Far Eastern Electronic Toll Collection Co, fix the problems immediately and said the ministry would consider ending the contract if the company failed to improve the situation.
Though he sounded determined to resolve the issue, the public seems to have lost trust in the system, and the government must address the crisis of confidence and restore its credibility.
The ETC system was launched after more than a decade of planning and implementation. The government decided to adopt a build-operate-transfer (BOT) model for the system and signed a contract with the company in 2007. Various errors found in the system’s software and infrastructure have delayed the project ever since. The ministry should accept responsibility for its poor supervision over the years.
The BOT model has also generated concern about the company’s monopoly on the project’s profits. Besides an estimated NT$200 million (US$6.6 million) in profits, the company was also exempted from a penalty of more than NT$220 million in 2012 for failing to reach a 60 percent ETC usage rate, thanks to the government’s defense of the company’s efforts to find a solution. The company also failed to achieve an ETC usage rate of 70 percent last year, but it refused to pay the NT$440 million it was contractually obliged to. Despite the system’s poor quality, the government continued to pay the company NT$2 billion every year according to the contract.
After a flaw was found in the system that resulted in double charges for some motorists using the eTag payment system, the ministry seemed to toughen its stance by demanding that the company refund eTag users double the fees it mischarged and threatened to end the contract. However, the company blamed the errors on sensors that detected cars traveling in the fast lane in the opposite direction. The company described the flawed design as “fate” and said it would enhance the verification mechanism.
As the government and the contractor struggle to improve the ETC system, a protest against the eTag stickers gained more support from car owners. Protesters called for a nationwide boycott of the eTag system, urging over 5 million eTag users to withdraw from the program to force the government to end its cooperation with Far Eastern Electronic Toll Collection. The company, while promising to fix the errors as soon as possible, did not show much sincerity as it refused to reveal details of the errors in its system and insisted that early termination of the contract was unnecessary.
At this point, the company and the government have zero credibility. The company breached its contract and failed to fix the system; the ministry neglected its authority by allowing the company to launch a shoddy system.
The ministry must collect the penalties from the company and set up a deadline for it to fix the errors and stabilize the system. Otherwise, the world’s first toll system to be implemented on all national freeways will become known as the world’s worst toll system.