Taxpayers who paid billions for the construction of tolled motorways in NSW could wait years for the network, which disproportionately hurts people in Sydney’s west, to be reformed.

The reforms recommended by an independent review of tolls – including giving the government the power to set prices across the whole network – aren’t expected to begin until at least 2027.

The review, jointly led by former competition tsar Allan Fels, found motorway tolls in Sydney were higher than necessary or desirable and that a state government cap-and-rebate scheme was unsustainable.

The dominance of private toll-road operator Transurban was also highlighted as potentially harming competition, although the report noted the company’s profitability had not been excessive in recent years.

Transurban must engage in the process of toll reform, the final report released on Tuesday said.

“Transurban needs to acquire from the Sydney community a social licence to operate,” it said.

“The company is well aware of this but may have further to go to achieve it.”

Commuters in western Sydney were disproportionately bearing the financial brunt of the city’s largely privatised toll-road network, the review found.

But all taxpayers contributed to the cost of tolled motorways by either paying to use them or subsidising the bills for others, after the Minns Labor government offered rebates worth hundreds of dollars to each eligible driver.

The review found that wasn’t sustainable and that the relief was inadequately targeted, complicated to administer and created unintended beneficiaries.

“Toll reform is preferable to toll relief,” it said.

“Increased traffic and patronage of toll roads, through induced demand created by toll relief, directly benefits operators by increasing their revenues.”

A network-wide toll, founded on flexible, declining and distance-based pricing could be a better option.

And means-testing the existing $60 weekly toll cap rebate and increasing it to $70 could ease pressure on government finances ahead of a broader pricing overhaul, the review recommended.

A government-run NSW motorways entity should also be established, as part of a legislative package giving greater control over toll prices, if operators cannot reach an agreement for network-wide pricing.

The NSW budget, delivered in June, included $16.6 million to support reforms arising from the review, including a commitment to set up the motorway body.

The Labor government is expected to respond to the report by the end of 2024, but ministers have previously backed continuing toll-road cashback schemes.

The review was led by Professor Fels, the former chair of the Australian Competition and Consumer Commission, and former Consumer Affairs Victoria director David Cousins.

Transurban has been contacted for comment.

– AAP