Government must ‘take the lead’ and make a decision on electronic tolls, says Sanral CEO

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Sanral CEO Skhumbuzo Macozoma called on the government to “make the most of it” and make a decision on the Gauteng Highway Improvement Project (GFIP) electronic toll system.

“There are no easy answers. All of the options that we have presented to the government have very significant financial implications and I think we just have to make a decision,” Macozoma told Consulting Engineers South Africa (Cesa) Infrastructure Indaba Wednesday.

“Bite the bullet and do it. There will be no response that does not affect the South Africans in the pocket, including the cancellation.

“Cancellation is actually the most expensive of the options on the table. It is therefore a complex decision but it must be taken. It is not helping that we [Sanral] have no decision, ”he said.

No Mbalula deadline this time

Macozoma’s comments follow Transport Minister Fikile Mbalula who told parliament on Wednesday that the date of an announcement on the future of electronic tolls in Gauteng cannot be determined at this point and that the organization Undoing Tax Abuse (Outa) suggested the reason the government couldn’t make a decision on the future of e-tolls could be related to corruption or the allocation of funds to areas where they shouldn’t go.

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Sanral Director General of Communications and Marketing Vusi Mona, responding to a request for comment on Outa’s corruption allegations, said: “As an agency of the National Department of Transportation, Sanral is not in able to comment on electronic tolls as long as there is no government declaration on the future of electronic tolls. We will be guided by the national Minister of Transport in this regard.

Kapsch TrafficCom

Electronic Toll Collection (ETC), owned by the Austrian company Kapsch TrafficCom, manages the collection of electronic tolls in South Africa.

Kapsch said he did not want to be drawn into the Outa crusade against Gauteng’s open road toll system.

His only comment, therefore, is that he firmly rejects allegations of corruption in South Africa and Zambia, which “do not become more credible by repeating them over and over”.

Responding to a written question tabled in parliament, Mbalula again confirmed on Wednesday that the transport ministry had tabled various financing options around electronic tolls on the GFIP for a cabinet decision.

However, Mbalula said that after reviewing the options, the cabinet ordered the Ministry of Transportation and the National Treasury to jointly review the options and resubmit them to cabinet for review.

Ministers want “additional studies” to be carried out

“The announcement date on the future of electronic tolls in Gauteng cannot be determined at this point as discussions around funding the system continue, focusing on the various financial options available,” Mbalula said.

“The delay on the announcement is that the process to decide on the future of electronic toll is taking time because the two ministers [Transport and Finance] were to meet first and at their meeting they agreed that further studies be carried out to inform the decision to be made.

“It is important to note that the ministry is committed to finding a viable solution that does not ‘drown the country in debt’, but which is equally sensitive to public concerns and, once the sustainable model is clear , a bid will then be made for the final cabinet decision.

Where does the R50m actually go per month?

Outa CEO Wayne Duvenage said Outa believes that the continued operation of Gauteng’s electronic tolls, to which only around 15% of motorists contribute, has little to do with finding a new funding mechanism and more to do with “where some of the current 50 million rand or so each month actually goes”.

Duvenage pointed out that from Outa’s perspective, there are very few options for the government to consider, adding that the only alternative to electronic tolls is for GFIP bonds to be funded through the national treasury.

He said that between 2016 and 2020, the Treasury had already allocated Sanral R 10.8 billion for the GFIP, which accounts for around 51% of the highway obligations for the overvalued upgrade and is on top of another subsidy of R70 billion – an annual average of R14 billion per year. year – for the same period for toll-free roads.

“This is the solution that has been practiced for several years and should continue to be so, as the whole country benefits from the Gauteng highway upgrade,” he said.

Duvenage asked why Sanral continued to operate the defunct system when only a handful of people – mainly a few companies that take advantage of electronic toll charges for their customers – continue to pay.

He said Sanral himself wrote off R23.6 billion from unpaid electronic toll bills, of which R17.3 billion was unrecognized revenue and R6.3 billion out of the R10.4 billion. reflected in Sanral’s books were written down as uncollectible. .

“So the fact of not collecting electronic tolls instead of paying GFIP obligations is a fait accompli,” he said.

Factors indicating possible corruption

Duvenage has pointed out that this has never been an effective or enforceable user payment system and Outa believes that corruption, or the allocation of funds to areas where those funds shouldn’t go, probably has something to do with it. see with the reluctance of the state to end the scheme.

He said that conclusion is based on several observations from Outa, including:

  • The five-year electronic toll collection contract ended three years ago and was followed by extensions until December 2021 and no further extensions are possible – and therefore there are no contractual obligations or penalties. to keep the contract alive.

  • About R50-55 million is collected by ETC each month, but how much is actually allocated to cover the costs of the collection process and which companies are providing “services” to ETC?

  • Outa did not respond to questions from Sanral and ETC regarding the allocation of R10 million to a so-called “BEE facilitation service provider, PRO-ASH”, which she said was a corrupt transaction. , the cost of which would be passed on to motorists.

  • Allegations regarding Austria-based Kapsch TrafficCom which was involved in a questionable and possibly corrupt transaction in Zambia valued at $ 5.5 million which was channeled through Kapsch’s South African accounts and resulted in lawsuits in Zambia regarding this matter.

  • The R17.9 billion GFIP project, far more than double the price it should have been, makes it clear that Sanral deliberately sanctioned overpayments or authorized serious mismanagement and unjustified profits of the project by local contracting companies.

“With too many questions and a lack of transparency on the electronic toll debacle, as well as the state’s reluctance to introduce a commission of inquiry or a full independent inquiry into the system, Outa believes there is no rational explanation for the continued collection of e-tolls and, as such, there must be another sinister or potentially corrupt motivating force behind its continued operation, ”said Duvenage.

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