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E-tolls: the big guns speak

Martin Czernowalow
By Martin Czernowalow, Contributor.
Johannesburg, 02 Sept 2014
People will hang themselves from these "beautiful" gantries, says the Justice Project South Africa.
People will hang themselves from these "beautiful" gantries, says the Justice Project South Africa.

The e-tolling review panel has this week heard arguments from two of the fiercest opponents to the Gauteng e-tolling system, with both lobby groups presenting extensive and well-researched objections to the system in its current format.

The Opposition to Urban Tolling Alliance (Outa) took centre stage at the proceedings this morning, as chairperson Wayne Duvenage called for a suspension of e-tolling and an engagement by shareholders "to imagine what truly integrated urban transport and congestion management for Gauteng would be like".

The 15-member review panel was appointed by Gauteng premier David Makhura to probe the socio-economic impact of the Gauteng Freeway Improvement Project (GFIP) and the e-tolling system put in place to fund it. The panel should present its findings at the end of November.

"This system is falling far short of its intentions and targets," Duvenage told the panel. "We are not saying it will fail; we are saying it has failed."

Outa has always been a fervent supporter of the fuel levy and taxation as means of funding the GFIP, instead of the e-tolling model, but Duvenage said there has been a lot of misleading information coming from the South African National Roads Agency (Sanral) regarding this issue.

Outa this morning proposed that, during the suspension of e?tolling, various alternative funding alternatives should be considered - either on a temporary or permanent basis:

* The funds required for the settlement of the bond are paid out of the current fiscus, bearing in mind the fuel levy has been increased by 55c [per litre] since the completion of the GFIP in 2011/12,which adds a further R12 billion to government's coffers.
* If these funds are unavailable, Outa proposes the national fuel levy be increased by about 9c per litre to raise the revenue to meet the GFIP's financial commitments of approximately R1.9 billion a year.
* Alternatively, Outa proposes that a combination of the national fuel levy and an inland fuel levy be adopted. An inland fuel levy will have the effect of concentrating some of the charge to Gauteng motorists, and Outa says government has ring-fenced fuel levies in the past.
* A third option takes into account that because the nation, as a whole, benefits from the productivity and success of the Gauteng region, funding should be extracted from the general fiscus.

"We believe a collaborative effort and approach by all stakeholders on this matter will improve the credit rating of Sanral and will achieve the best possible result for both citizens and the state," said Outa.

Duvange pointed out that, since the inception of e-tolls in December 2013, "Outa estimates of 39% compliance after eight months after operation, extrapolate that over 1.5 million of the 2.5 million freeway users were not fitted with e-tags, signalling that the rejection of the system by the public was holding strong".

'Socio-economic disaster'

Also strongly rejecting e-tolling was the Justice Project South Africa (JPSA), which appeared before the review panel yesterday. Chairman Howard Dembovsky said the system would create the "socio-economic disaster of the millennium and we will see people hanging themselves from these beautiful gantries", as e-tolling will cripple the economy of Gauteng and South Africa, as a whole.

In its written submission to the panel, JPSA says: "It is our assertion that Gauteng, and government in general, should scrap this irrational and grossly inefficient system of e-tolling and replace it with the tried and tested, inexpensive and easy to administer fuel levy.

"There is absolutely no shame whatsoever in admitting that one was misled by greedy companies and individuals. What would be a real shame, however, would be for the system to reach a point where its failure forces its financial collapse, while in the meantime, scores of citizens are turned into unemployable, artificial criminals, and the support for the good things that have been achieved since independence become overshadowed by this monumental disaster."

The JPSA notes it is aware the e-tolls review panel has the mandate of soliciting "new recommendations" with respect to funding infrastructure and "as much as we hope to provide one such recommendation, it is important that in our eagerness to come up with something 'new' we don't end up ignoring the elephant in the room, which is indeed, the fuel levy".

Dembovsky told the panel that the introduction of a fuel levy of 14c per litre would enable Sanral to repay its debt sooner.

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