Austrian-based Kapsch Trafficom, which is partnering with the South African National Roads Agency (Sanral) on the Gauteng e-tolling project, has identified SA as a major financial risk, in its interim financials for the first half of the 2014/15 financial year.
Its recently published report shows SA accounts for EUR80.4 million (R1.1 billion) of the company's contingent liabilities, as at 30 September last year, out of a total of EUR182.4 million (R25 billion). A contingent liability is a potential liability that may develop into an actual liability, and public companies are expected to record contingent liabilities, if the liability is probable.
The EUR80.4 million figure puts SA at the top of the group's contingent liability list, followed by the toll collection system in North America, at EUR75.7 million (R1 billion), and truck toll collection system in Austria, at EUR8.5 million (R117 million).
According to CEO Georg Kapsch, the group "will continue to work hard on improving the profit situation in South Africa".
However, the e-tolling project seems to be in dire straits, with the compliance rate by motorists averaging about 37%. In December last year - a year after the project went live in Gauteng - transport minister Dipuo Peters revealed that close to R1 billion had been collected as at 30 September. This is about a third of what Sanral initially expected to collect.
Peters also informed Parliament that - as at 30 September - there were 1.2 million active accounts registered on the system, as opposed to 2.5 million users, and added that 93 292 e-toll accounts had been deregistered.
The future looks even bleaker for Sanral, with indications that the agency will be about R5 billion in the red by December this year, as it is racks up debt of at least R200 million a month on the Gauteng Freeway Improvement Project.
In the first four months of the system going live, Sanral effectively wrote off R1.123 billion, because the overdue amount was not recognised, as the agency did not anticipate being able to collect it.
Review panel report
Meanwhile, large-scale opposition to the project, the low compliance rate and a review by a local government-appointed panel have raised e-toll opponents' hopes that the project will be scrapped in its current format.
Gauteng premier David Makhura is expected to release the findings of the review panel later this month, after receiving its final report at the beginning of December. Makhura established the 15-member panel in July last year to assess the socio-economic impact of e-tolling on the province.
During the past few months, the panel received input from different stakeholders and organisations, including business, civil society, as well as national government and Sanral.
Anti-e-toll lobby groups, such as the Opposition to Urban Tolling Alliance and the Justice Project SA, have long been calling for the fuel levy to be used to finance the Gauteng Freeway Improvement Project, instead of the current user-pay principle.
Both parties expect Makhura to announce a recommendation for a switch to the fuel levy as a funding mechanism, when he releases the review panel's report in the coming weeks.
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