Tag: e-tolls

It is estimated that the South African National Roads Agency Limited (Sanral) has spent approximately R5.3-billion trying to recover e-tolls from motorists who are unwilling and unlikely to pay.

This is according to an analysis from the Organisation Undoing Tax Abuse (OUTA).

  • Sanral has spent almost half the amount of money as it was trying to collect
  • According to its financials, it spent R508 million on collecting e-tolls, which brought in over R660 million in revenue
  • OUTA has estimated that it has cost the roads agency around R5.3 billion to operate the e-toll system
  • Sanral’s financial statements show that it only hoped to collect around R10.5 billion from e-tolls since 2014
  • Sanral didn’t recognise 50% or more of the e-toll bills it sent out every year as potential revenue
  • Sanral effectively wrote off over R17 billion in e-toll revenue
  • Of the amounts owing to Sanral for e-tolls, the roads agency only recognised around R9.8 billion in its most recent financial results as debt owed by motorists
  • It is not known exactly how much Sanral pays for its contract with the Electronic Toll Collections (ETC) company, nor what its other administration costs for the e-toll system is

By Mihlali Ntsabo for EWN

Gauteng Premier David Makhura said President Cyril Ramaphosa would make an announcement on e-tolls in due time.

Makhura was delivering his 2020 State of the Province Address at Sefako Makgatho Health Sciences University in Ga-Rankuwa.

E-tolls have been one of the widely contested issues in the country dating back to February 2013 to the Congress of South African Trade Union’s drive-slow campaign ahead of the implementation of the system in December 2013.

The tripartite alliance partner continued with its civil disobedience campaign up until e-tolls were implemented – even setting bills on fire in front of Sanral’s offices in Pretoria.

The following year, Makhura announced in his State of the Province Address that a review panel would be set up to look at the feasibility of the model.

During his address on Tuesday, Makhura said: “As the Executive Council, we made a strong and persuasive case to national government on the e-tolls. I have been assured by President Cyril Ramaphosa that a lasting solution has been found and an announcement by the President is imminent.”

Meanwhile, the Democratic Alliance’s Solly Msimanga earlier on Tuesday said e-tolls were here to stay.

“What the Premier has been doing all this time is actually just kicking the ball along and hoping that the people of Gauteng will somehow forget and begin to pay. But the people of Gauteng are very adamant; we are paying enough.”

Last year, Finance Minister Tito Mboweni announced that the e-tolls system would remain in their current form.

When delivering his Medium Term Budget Policy Statement in Parliament in October, Mboweni said the decision was taken after consultation with key players in the transport sector.

Ministers at war over e-tolls

Minister of Finance Tito Mboweni took to Twitter on Thursday to oppose Gauteng premier David Makhura’s views that the e-toll system should be scrapped.

David Makhura said in a speech that “our position has not changed. We remain determined that e-tolls are not part of the future of our province.” He went as far as saying that the provincial government was prepared to pay some of the money owed by motorists to ensure the tolling system was scrapped.

Mboweni fired off a series of tweets saying that there should have been a plan at the introduction of e-tolls to ensure the system worked and yielded returns in the long term.

Mboweni incited public ire when he tweeted “I don’t know why the middle and upper classes in Gauteng want to complicate our lives. The working class do not pay e-tolls!! Public transport! Hello…”. Motorists and public transport users disagreed with the sentiment.

Transport Minister Fikile Mbalula waded in, saying President Cyril Ramaphosa instructed that a meeting be held to discuss a way forward, rather than debating the matter over Twitter.

Sanral suspends e-toll debt collection

Source: News24

The South African National Roads Agency has announced that it is suspending the process of pursuing e-toll debt.

This after Sanral’s board passed an urgent resolution on the matter on Tuesday.

“It resolved that given the initiative led by President Cyril Ramaphosa to address the e-tolls payment impasse, Sanral will, with immediate effect, suspend the process of pursuing e-toll debt. This includes historic debt and summonses applied for from 2015. No new summonses will be applied for,” Sanral spokesperson Vusi Mona said in a statement issued on Wednesday.

Sanral says the decision will be constantly monitored by the board and reviewed according to prevailing circumstances.

Netwerk24 had reported earlier this month that only 26 motorists had received default judgments so far for not paying their e-toll bills.

Mona told the News24 sister site that motorists owe Sanral more than R10.9-billion in unpaid e-toll money.

R5.7bn bailout for e-tolls

By Tom Head for The South African

Gauteng motorists, we’ve got some bad news: e-tolls have been given the kiss of life by the government, who have promised to cover Sanral’s debts.

When the people talk, politicians should listen. However, it would seem there have been some spectacular crossed wires in Gauteng. The much-maligned and financially crippled e-tolls system will now live to fight another day, after Transport Minister Blade Nzimande confirmed Sanral would receive a R5.7 billion bailout.

The roads agency have been plunged into fiscal despair by the ill-conceived tolls, which have failed to bring in the revenue previously forecast. It has left Sanral with debts soaring above R10 billion, but thanks to the deep pockets of the ANC, their money woes have effectively been halved.

Why Sanral have been bailed out
Nzimande explained the decision via a statement on Monday afternoon. He says the bailout is to help ensure that the department can meet “payment terms” with its investors. The move was labelled as a “strategic intervention” to help prop-up the Gauteng Freeway Improvement Project (GFIP).

“As a result of Sanral’s toll network experiencing financial difficulties, and to ensure that Sanral complies to its payment terms to investors, as well as to maintain the toll network across the country, funds were transferred from the non-toll network to the toll network. However, the department is working to resolve the issue of the GFIP speedily.”

E-tolls: Where is the money coming from?
The money has been taken from the Medium-term budget appropriation. It’s important to note that this money was not taken from the Treasury. Instead, money that was set aside for mid-term spending back in October 2018 will now go towards the e-tolls system, which continues to fail upwards.

Despite several promises from local government – including Gauteng Premier David Makhura, who vowed to rid the system from the province – it seems that national structures of the ANC have had the final word.

 

OUTA warns of e-toll malware scam

OUTA has notified members on its Facebook page that a highly suspicious SMS is doing the rounds with regards to e-tolls.

The organisation notes that before members of the public can appear in any court for any matter, they need to be summonsed.

This SMS is a scam to cash in on people’s fear in light of the current uncertainty around e-tolls. The link contains a link to documents which contain malware. The public is advised not to open the link, and to delete the SMS immediately.

By Kgomotso Modise for EWN

The Gauteng government says while it would like to see e-tolls scrapped, it’s not up to the province to make the call.

Last week, while answering to Parliament, Transport Minister Blade Nzimande revealed that over 15 000 motorists have been issued with summonses for outstanding debt.

In July, the provincial ANC announced plans to do away with the disastrous system with Premier David Makhura conceding that it has failed.

Gauteng government spokesperson Thabo Masebe says the e-toll system was introduced by the national government so the province has no power to scrap it.

“The Gauteng government has made its position clear. But we don’t run or operate the e-toll system. This is a national government project and can only be scrapped by them.”

Masebe also says Gauteng has no say in who gets summonsed by roads agency Sanral.

“I can’t talk about Sanral’s fees and the operation of the e-tolls. That must be directed to the national government.”

He says Makhura and President Cyril Ramaphosa agree that something has to be done, but no plan has been finalised.

By Penwell Dlamini for Sowetan Live; BusinessTech

Gauteng residents may have to wait for some time before clear word comes through on what should happen to the failed e-tolling system in the province.

Gauteng premier David Makhura tried unsuccessfully to explain to the legislature when the controversial system would be scrapped.

DA provincial leader John Moody asked Makhura when the gantries on Gauteng highways will be switched off and if those who have paid their e-toll bills will be refunded.

In his reply, Makhura said the matter is with national government and the ANC in the province would continue its campaigns for the scrapping of e-tolling.

A recent article in BusinessTech said that in an interview with Talk Radio 702’s Karima Brown, the deputy chairperson of the ANC in Gauteng, Panyaza Lesufi, avoided the question of how Gauteng’s roads will be funded and maintained going forward, instead stating that the province first needs to “let go” of the current system.

The ANC had previously stated that the controversial e-tolling system should be scrapped.

“The e-toll matter has now been referred to national government. The president [Cyril Ramaphosa] was there when we made call that e-tolls in this province …must be scrapped. We made that point at the ANC conference. We did not say the e-tolls are scrapped. [The issue of e-tolls] is at national government, which is now responsible for this matter.

“We as the ANC are going lead a campaign [against e-tolls]. There is no contradiction between the ANC taking up [national government]. There is no contradiction in that. We have been doing that all the time…I will lead the march to the Union Buildings. There is no contradiction in that. It will not be the first march to the Union Buildings. We are going to continue to lead in ensuring that the e-tolls become a matter of yesterday,” Makhura said.

At their recent provincial conference, Gauteng ANC members reiterated their position calling for the scrapping of e-tolls.

But the EFF is rejecting the ANC’s statement, saying the ruling party is raising the issue simply to appease voters.

“It is now going to be elections, you are starting again with this thing of yours with e-tolls. Leave the e-tolls alone. You have failed to scrap it. It is like your mother party [the ANC]; every time we go to elections, they start changing their tone with the land issue…All I am saying is that please do not fool us and try to tell us that you will do something about e-tolls. People of Gauteng must never pay e-tolls and we are not going to pay them,” said EFF MPL Ntobeng Ntobeng.

Makhura could not give any indication when national government would make its final decision on what should be done with e-tolls.

E-Tolls: Makhura admits system failure

In his State of the Province address on Monday, Gauteng Premier David Makhura acknowledged that the highly contested e-tolls system in Gauteng has been a failure. Makhura’s comments follow a number of years of resistance to the multibillion-rand e-tolls project by civil organisations and motorists.

“It’s loud and clear for all to see that e-tolls have not worked,” Gauteng Premier David Makhura said during his State of the Province address.

But it’s not the first time that Makhura has admitted that the e-tolls system was ill-conceived.

Delivering his 2017 State of the Province address, Makhura said: “We are mobilising resources for public transport infrastructure in ways that will ensure that we do not commit the same mistakes done with the e-tolls. We can’t build roads and only later inform citizens that they must pay. In fact, there will be no new e-tolls on our new roads.”

He added: “I must admit publicly, as I did last year, that all the efforts we have made through the advisory panel have not led to the resolution of concerns of Gauteng motorists regarding affordability. We have tried our best. The ultimate solution can only come from national level. We will continue to engage in order to represent the interests of our residents.”

On Monday, Makhura again admitted that e-tolls had failed and that the implementation of the system had increased the cost of living for many motorists and commuters in Gauteng.

Drawing from Ramaphosa’s envisaging of a “new dawn” in the country, Makhura said: “The new dawn must also bring a solution to the protracted and unresolved problem of e-tolls. Accordingly, I will engage President (Cyril) Ramaphosa in order to find a new and more equitable funding model to support the continued expansion of Gauteng’s road network and public transport system. Please send me!” he said.

The Organisation Outdoing tax Abuse (Outa) said it was in total agreement with Makhura in calling for a new and more equitable funding model to expand Gauteng’s road network.

“The compliance rate of e-tolls, based on the South African Roads Agency’s (Sanral’s) own version in their 2017 Annual Report, is 29%. If this figure is correct, it is clear that the system has failed. SANRAL could not in more than four years succeed to ensure a higher compliance rate. If compliance on this scheme doesn’t go up to at least 85% the scheme will never survive,” Outa’s Transport Portfolio Manager Rudie Heyneke said.

Heyneke said OUTA would not back down on the issue of the unaffordability of e-tolls, and would further engage the Minister of Transport, the Presidency, and the executive on the matter.

He said the organisation was busy preparing a submission for the Minister of Transport and the Presidency, and would in the near future engage with the executive to show the negative impact e-tolls have on the taxpayer and on the Sanral budget and proposed alternatives.

The writing has always been on the wall. Apart from firm resistance from Gauteng’s motorists, the highest compliance level ever achieved was 40% in June 2014, according to information released by Outa. This was achieved at R120-million and around R140-million short of target.

“The collection costs and litigation costs are too high when measured against the revenue generated by e-tolls,” Outa said in a statement.

Sanral had argued in court that it could achieve a payment rate of 93% which would generate the R260-million required to cover the cost of the project and the R22-billion borrowed for the freeway upgrade project.

But none of Sanral’s targets has been reached despite aggressive marketing and offers of discounts of up to 60% to all e-toll defaulters to encourage them to settle outstanding bills. According to Outa, by May 2016 less than 2% of outstanding bills were settled while e-toll bills increased to over R2-million a month. The cost of administering the e-tolls were capped at R1-billion a year.

When the e-tolls system was about to be rolled out, motorists and taxpayers objected vociferously, particularly over a lack of proper public consultations prior to the implementation of the system. This outcry as well as warnings from civil organisations like Outa were ignored.

Outa Chairman Wayne Duvenage told Daily Maverick the organisation was pleased with the premier’s acknowledgement. Duvenage said the issue was not only a provincial matter, but also a national one.

“E-tolls were a bad decision,” Duvenage said.

By Bheki C. Simelane for Daily Maverick

The government has proposed new laws following the dismal failure of e-tolling revenue collection from Gauteng motorists, who owe more than R6-billion in unpaid tolls.
The purpose of the South African National Roads Agency Limited and National Roads Amendment Bill is to amend previous road acts to address the public outcry which arose as a result of the implementation of the Gauteng Freeway Improvement Project.

When e-tolls were introduced in 2013 as part of the project, motorists accused Sanral of not conducting proper consultation. To ensure this does not happen in other provinces, Sanral is amending the bill that governs e-tolling.

Disastrous consequences

The proposed amendments to the bill will give provincial and municipal governments more power in the implementation of e-tolls.The amendment bill acknowledges the disastrous consequences in Gauteng and aims to prevent them. The proposed bill further states that “the manner in which the public consultation process was conducted on this project was not to the satisfaction of the public, and there is a need to strengthen consultation”.

Keep in touch with IOL Motoring on Facebook
They now want to give more power to premiers and municipal governments with regard to the roads that will be tolled. The premier will be given at least 30 days to hear out objections on a road that has been flagged for tolling. If objections are more than 55 percent the premier will have to call for a referendum within six weeks.

In the amendments, Sanral is also required to, before tolling the roads, identify “an alternative route of comparable distance, which must be a tar road, be maintained adequately and be suitable for increased usage”.

Review

In June transport minister Joe Maswanganyi said the South African government would once again review Gauteng’s e-toll policy, in the hope that a better one could be found.

“We want to come up with a tolling policy that our people will actually accept,” he said. “We are not closing our ears to what people are saying – we are working with the government of Gauteng and with Sanral, and at the end of the day, we believe we will come up with a policy on tolling that will be acceptable.”

Organisation Undoing Tax Abuse chairman Wayne Duvenage on Sunday welcomed the e-toll Plan B and believed the amendments would go a long way in protecting motorists.

“It will be better if the consultations are done by the National Council of Provinces and provinces which are affected,” he said. “This will mean the public is consulted meaningfully, unlike in the Gauteng Freeway Improvement Project – which is why it failed.”

Challenge to e-tolling

He said that if provinces were consulted, e-tolling would not be implemented – as in the case of Western Cape. Sanral wanted to toll the N1 and N2 Cape Winelands highways, but the City of Cape Town took Sanral to court in 2015, challenging the tolling of the roads.

The court set aside Sanral’s decision to toll the roads – and this, Duvenage thinks, is what will happen in most provinces.

“If they had made proper consultations in Gauteng, we don’t believe the roads would have been tolled,” he said. “It doesn’t mean that the freeway would not have been upgraded – it just would have been paid for differently. It is good that this legislation is coming through.”

He said the scheme would likely fail in other provinces.

“I don’t think other provinces will ever get e-tolls because they go beyond getting the public to buy in. It goes to the ability to administer the scheme.

Failed eNatis system

“We have a failed eNatis system and we have problems with the administration of traffic fines, and so we believe the context of the environment is one which e-tolling will fail in South Africa,” Duvenage said. He added that while e-tolling in other provinces would not take off, it would also fail further in Gauteng.

“We believe the e-tolls in Gauteng will not be around for much longer, and the reason is that the five-year collection tender comes up for renewal in just over a year,” he said. “We believe they won’t go out for tender because they are not even collecting the amount of money required.”

In February Gauteng premier David Makhura said the e-tolling system was a mistake and that no new tolled roads would be introduced in the province. It was revealed in Parliament by the Department of Transport in June that more than 70 percent of e-tolls issued were not paid by motorists.

Sanral spokesperson Vusi Mona was unavailable for comment.

By Tebogo Monama for IOL

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