Finance minister Pravin Gordhan admits the National Treasury did know the Public Investment Corporation (PIC) had acquired bonds in SA National Road Agency (Sanral), to the sum of R17 billion.
However, he denies this information was part of the motivation for Cabinet to support an additional appropriation of R5.75 billion to Sanral for the Gauteng Freeway Improvement Project, for which e-tolling was created.
The PIC is wholly-owned by government and manages investment funds on behalf of public sector entities. Clients of the PIC include the Government Employees Pension Fund (GEPF).
“The National Treasury is aware that the PIC has made investments on behalf of the GEPF in Sanral bonds since 1998.”
Gordhan says this information was not part of the motivation for Cabinet to support the additional R5.75 billion. “The funding was provided in order to accommodate affordability concerns through introducing further discounts for frequent users and time-of-day savings for heavy vehicles [within the e-tolling system].”
Apartheid tactics
The Inkatha Freedom Party (IFP) said if the Gauteng e-toll project fails, government will have to bail-out Sanral, as well as the civil servants' pension funds.
“Our investment in conventional and inflation-linked bonds, issued by government and state-owned entities (including Sanral), is informed by our investment policy, which takes into account our long-term liabilities as a pension fund. Importantly, the crafting of our investment policy is done in consultation with the minister of finance, who acts as a guarantor of the fund on behalf of government,” says Arthur Moloto, chairperson of the board of trustees.
However, the IFP says the investment by the PIC of R17 billion in Sanral bonds - 89% of which is made up of the GEPF money ‑ is the real reason behind government's push to ensure the controversial Gauteng e-tolling project succeeds.
Describing the investment as “pre-1994 tactics”, IFP's spokesperson on finance and on the e-tolling project, Narend Singh, says it is finally clear why government wants to save this project at all cost, despite it being unfeasible and despite it receiving so much public resistance.
"Never could one have imagined such a huge cover-up in our post-democratic dispensation. It is now clear that there are huge economic issues at stake. If the tolling project fails, government will not only have to bail-out Sanral, but it will have to bail-out the civil servants' pension funds as well,” he comments.
Share
