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Jakarta Post

Editorial: Lucrative street business

  • The Jakarta Post

    The Jakarta Post

  /   Sat, January 31, 2015   /  10:13 am

The Jakarta government has never stopped looking for breakthroughs in its bid to increase revenues from, among other things, parking fees. After launching and trying the parking meter system on Jl. Sabang last September, the city administration introduced on Thursday an electronic card to pay parking fees along the crowded Central Jakarta street.

The new system looks to work as well as planned. Before the meters were installed the Transportation Agency collected only Rp 500,000 (US$40) per day, but now the parking revenues have increased 12-fold. The next goal is to raise the target to Rp 14 million a day.

The successful pilot project has prompted the municipality to expand the new system to 300 other streets across the capital and by 2017 all on-street parking areas should be using parking meters. If the meters completely replace the traditional system, Jakarta will join the ranks of the major metropoles.

To some extent the rise of the on-street parking fee from Rp 3,000 to Rp 5,000 per hour for four-wheeled vehicles contributes to the skyrocketing revenue, but it is the system change that matters the most. Parking meters plug leaking revenues as currently parking attendants, who are mostly not officially hired by the government, reserve a big portion of the money they collect for their thuggish masters and allocate only a little of it to the city government. Individual security officers may also have ask for a share in exchange for protection.

Governor Basuki '€œAhok'€ Tjahaja Purnama is intent on ending the decades-old, corruption-ridden business that has led to gangsters dividing streetside spheres of influence among themselves. With the rapid growth in the use of cars and motorcycles over the past decade, street parking has turned into a lucrative business, but one that has made little contribution to the municipality.

The parking meter system cuts the flow of largely unaccounted money and stops illegal levies and other practices that benefit only a few individuals, either officials or thugs, at the expense of residents.

The new parking scheme offers the transparency and accountability Governor Ahok has been promoting as the city will appoint a parking meter operator through an open tender. Investors deem the new parking business will be profitable, particularly because of the handsome 70/30 revenue split in favor of the private sector.

Apart from installing meters, an investor is required to provide infrastructure, including CCTV cameras that will boost security.

The new system also allows the public to resist corruption as it would give no room for parking attendants to ask for tips. More revenues would thus go to the city'€™s coffers as the parking fees will be paid using e-money. Ahok'€™s promise to pay the parking attendants double the regional minimum wage, amounting to about Rp 5.4 million a month, is therefore a logical consequence of the new system.

Governor Ahok, however, cannot rest after changing the parking system. On-street parking is not the ideal choice as it disrupts traffic. The city government can invest the huge revenues from the parking fees to build and operate off-street parking lots.

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