Scrap the ill-conceived Gauteng e-toll scheme now — and stop the sabre-rattling on the fuel levy

The suggestion to fund the 186km Gauteng Freeway Improvement Project (GFIP) from general tax allocations — which the fuel levy feeds into — was proposed by civil society in 2011 as an alternative mechanism to the irrational, cumbersome and expensive e-toll scheme.

Adding fuel to the fire, Nazir Alli’s Sanral team had lost control of the project’s construction costs between 2008 and 2012, and what ought to have been no more than a R9-billion bond (requiring around R500-million to finance per annum), came in at R18-billion. Using the public’s money, the state now had to fork out around R1-billion per annum to finance the inflated bond requirements, an expensive blunder courtesy of Sanral’s mismanagement. 

Nonetheless, even at R1-billion per annum to settle an expensive R18-billion GFIP bond over 20 years, the easiest option for the Treasury was to simply increase its annual allocation to Sanral by this amount. And if it was unable to find the additional funds for Sanral, a last resort, 5c/litre increase to the fuel levy would have raised the required R1-billion from just more than 23 billion litres of fuel sold each year.

And guess what it did?

Not only did it try to coerce the public to pay their e-toll bills, Treasury steadily increased the fuel levy by an average of 20c every year, raising the levy from R1.27 in 2008/9 (when it started the GFIP) to R3.83 in 2021. This has increased Treasury’s annual fuel levy income from about R25-billion in 2009 to R85-billion today. And all it needed was R1-billion per annum to enable the freeway network upgrade of South Africa’s economic hub.

When the reality of Sanral’s e-toll shortfall hit home in 2014/15 — a year after the scheme was launched — Treasury began allocating additional GFIP grant funds to Sanral, exactly as Outa had suggested it do. Over the six years from 2015/16 to 2021, Treasury has allocated an average of R2.3-billion per annum to Sanral (a total of R13.5-billion) to cover the GFIP bonds. In addition, Treasury also increased its annual “non-toll” road grant allocation to Sanral from R4.1-billion in 2009 to R17.2-billion in 2021.

Adding more certainty to the government’s confused state of mind on the matter are occasional utterances by politicians who refer to costly penalties if the e-toll scheme is cancelled. This is sheer tripe, as the Electronic Toll Collections contract with Sanral expired three years ago in December 2018 and cancellation penalties have not been applicable since then. 

Furthermore, if the scheme is shut down tomorrow, Sanral loses nothing from the R55-million income it currently collects each month, as it will merely stop collecting money that is used to pay for the collection process. Nothing is being allocated to the tarmac.

So the next time Minister Mantashe (or any other politician) tells you that it will cost citizens more to scrap the e-toll scheme than it does to keep it going, tell them to take a hike. And while you’re at it, tell them they don’t need another cent added to the already bloated fuel levy, because they have more than enough to settle the GFIP bonds.

Tell them to do the maths and that 10c/litre from the existing R3.83 fuel levy will more than cover the inflated GFIP bond, including outstanding interest for the past decade.

At the same time, ask Mr Mantashe and his Cabinet colleagues to focus instead on reducing corruption, maladministration and wasteful expenditure, as this is where they will find plenty of cash to address our mountain of debt incurred from GFIP, Medupi, Kusile, SAA and other costly escapades undertaken by the ANC led-government.

Of all the policy blunders our government has made since democracy, the Gauteng e-toll debacle tops the cake. There is nothing more embarrassing and tragic than a government that is unable to manage or enforce its newly hatched policies.

Today, the state is left with two options on the e-toll debacle, the first of which is to humble itself and take the decision to scrap the scheme or second, to continue kicking the can down the road, hoping the issue will fade away and thereby negate the first option.

I’m sorry to say Mr Mantashe, the public and Outa will not allow the second option to be, so it’s time to halt his nonsensical drivel and eat that humble pie. DM

[hearken id="daily-maverick/8881"]