Toll caps should be axed in a complete overhaul of Sydney's motorway pricing to benefit commuters and taxpayers, a major review has found.
But any reform could be years away despite the NSW government welcoming the chance to fix the system in its heavily tolled capital city.
The review found Sydney motorway tolls were higher than necessary and an existing state government scheme to cap weekly toll charges at $60 was deeply flawed.
The dominance of private toll-road operator Transurban, the only non-government owner of motorways in the state, was also highlighted as an obstacle to competition in a report released on Tuesday.
Roads Minister John Graham said the state had a once-in-a-generation opportunity to reform motorway charges, but the government's preferred approach would be negotiation with the tolling giant.
"We are committed to taking back control of tolls in NSW," he told reporters.
Lower tolls should be introduced for most trips, according to the review jointly led by former competition tsar Allan Fels.
It recommended uniform charges on all 13 motorways including per-kilometre fees that decrease with the distance travelled, and two-way tolling over Sydney Harbour via the government-owned bridge and tunnel.
"Sydney tolls are too high and too unfair and an ever-increasing burden on motorists," Professor Fels said.
The review also called for the establishment of a state-owned NSW Motorways entity to regulate tolls.
The NSW budget in June included $16.6 million to support reforms arising from the review, including a commitment to set up the motorway body.
While a Christmas deadline for a deal with Transurban was encouraged, the reviewers said the government should be prepared to act alone if the parties did not agree.
That would involve introducing legislation to take control of charges ahead of some changes being rolled out by 2027.
Reaching an agreement to cut prices would be a win for all parties as many motorways were under-utilised due to commuters avoiding the high fees, reducing the operator's profit, Prof Fels said.
Deals had been done behind closed doors with private toll-road operators for too long, Treasurer Daniel Mookhey said.
"We need to get on with the job of providing relief for motorists in the most tolled city in the world," he said.
Transurban would work with the government on potential reforms while protecting the $36 billion invested in the state's motorways, the company's chief executive Michelle Jablko said.
"The government has made it clear contracts will be honoured and that its preferred pathway to reform is working with concessionaires to find a solution," she said.
The government and toll-road operators should negotiate a system that was better for taxpayers and drivers, industry think tank Infrastructure Partnerships Australia said.
"If the core objective is simplicity, motorists shouldn’t need to carry an abacus around in their car to work out what their toll may be," chief executive Adrian Dwyer said.
The review was led by Prof Fels, the former chair of the Australian Competition and Consumer Commission, and former Consumer Affairs Victoria director David Cousins.
