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Ten cents a gantry for e-tolls?

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Gauteng e-tolls fee discounted
Gauteng e-tolls fee discounted

Ten cents for passing each gantry up to a maximum of R100 a month – a discount of 70% of the current fees for Gauteng’s e-tolls – or scrapping them completely.

These are two of the seven proposals that will be put forward to Cabinet by a task team established by President Cyril Ramaphosa to find a lasting solution to calls for the e-tolls to be scrapped.

The team – comprising Transport Minister Fikile Mbalula, Finance Minister Tito Mboweni and Gauteng Premier David Makhura – has failed to find common ground on the matter, leaving Cabinet to be the final arbiter, sources told City Press. The two options mentioned above werethe onesbeing seriously considered.

“There are two extremes to be presented to the president. One plan will look at keeping e-tolls, the other at finding R70bn to repay loans used to build Gauteng roads. The likelihood is that tolls will be kept at reduced fees, possibly maximum R100 per user per month or just 10c per gantry pass,” said one source privy to the details.

Read: You’re going to love paying for roads that used to be free – and here’s why

FIRST OPTION

City Press is in possession of two discussion documents, one of which outlines a 70% discount tariff rate.

In the document, based on 2018 financial assumptions, it is stated that the plan aims to, “in order to maintain the user-pay principle, increase compliance to about 50% and recover some of the toll operational cost. Debt servicing and repayment as well as road-related capital cost is paid for by government.”

PROS

. Motorists would be more pleased with lower tariffs, which may result in improved levels of compliance;

. A large portion of the revenue collected from government would assist Sanral’s ability to service debt and maintain the Gauteng Freeway Improvement Project (GFIP); and

. Investor confidence could improve.

CONS

. Financial viability of tolls would be negatively impacted because of the reduction in potential income, thus demanding a significant government contribution;

. The detractors of e-tolls may argue that the cost collection exceeds the actual toll collection. They may also argue that the scheme has failed and that government was refusing to acknowledge the reality; and,

. The compliance rate might not improve, judging by the history of e-toll payment.

SECOND OPTION

The second option entails government settling the bill on behalf of motorists.

“This option removes collection from road users and transfers the responsibility to honour all financial obligations of the GFIP e-toll scheme. Debt servicing and repayments, as well as road-related capital and rotational costs, are paid by government by means of a tax levy. The transaction clearing house operations and associated costs are reduced to only accommodate the clearing of electronic toll transactions at conventional toll plazas,” the document states.

PROS

. Eliminates the burden of toll payments by road users, which could bring about public acceptance;

. Revenue is collected from government. Revenue certainty will ensure that Sanral can service debt and maintain and operate the GFIP; and

. Toll operation cost would be reduced.

CONS

. The user-pay principle is not applied, thus compromising its application elsewhere. Users don’t pay directly and don’t internalise the cost of infrastructure provision and maintenance;

. The financial burden is placed on government, absolving road users from responsibility for road usage upkeep; and

. The public could exert pressure to cancel or convert other toll projects into shadow projects

On Saturday, Mbalula said there was a full commitment to finalise the process aimed at making the final determination on e-tolls and present the report to Ramaphosa.

The process entailed engagements with key stakeholders and exploring in detail various options, one of which was the scrapping of e-tolls, he said.

Following requests from some key stakeholders, they were granted more time to make representations that will inform the final determination.

The stakeholder engagements have thus been extended by a further two weeks, following which a recommendation will be made to the president and Cabinet.

OUTA AND AA

Mbalula has been in talks with various civil society organisations which have also submitted proposals regarding the matter.

Both the AA and Outa are in favour of the fuel levy payment method.

However, it would mean an increase in the fuel price, which will have an impact on all South African road users, even in small towns.

“Currently taxis are exempt and persons in townships who never use the roads are exempt too. But a fuel levy will mean all pay for roads they don’t use. The issue is, how does South Africa pay for its road infrastructure costs, estimated to be over R400bn? The Western Cape will soon have to answer this question as its entire road network is crumbling and severely under strain,” the source said.

MAKHURA’S COMMENTS

Makhura’s pronouncements on e-tolls are said to have played a role in road users’ behaviour, with the number of people making payments dropping significantly since the tolling system’s initial introduction.

He has openly advocated for the tolling system to be scrapped.

“There was a time road users were paying e-tolls upwards of 70% but Makhura’s pronouncements have dropped this to 30%. The issue is clear: each time Makhura says something, more people stop paying. But the province can’t cover the debt,” said the insider.

However, another source said Makhura still believed in the cancellation of the system.

“They (provincial government) are willing to take money from their own pockets and then do fund-raising to accumulate the rest of the money.

“Makhura is considering the lower middle class that earns about R15 000 per month. They will not be able to afford it at all,” the source said.

He added: “His argument is that our country is not equal because white people live close to where they work, and it is mostly black people who will have to pay for the system.”

Makhura has the backing of the Gauteng Provincial Executive Committee (PEC).

“The PEC has committed to launching a public action to intensify the campaign against e-tolls, using the two pillars of continuous engagement with the national leadership of the ANC and government and embarking on the pickets during Transport Month in October, should there be no tangible progress on the matter,” read its statement.

However, a source described the PEC as “a problem” because it has been unable to suggest a viable solution.

RED FLAGS

One source privy to the financials said there would be dire financial implications if National Treasury were to pay off the debt.

“South Africa’s debt is becoming unmanageable. People who have paid e-tolls since the beginning would have to be refunded if you cancelled e-tolls. That’s approximately R5 billion,” the source said.

Another source said National Treasury had been adamant that it would not be able to foot the bill without it negatively impacting the country’s and Africa’s economy.

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