E-tolls: Outa says ‘No’

Getting people to pay may prove to be government’s Achilles heel.
Compliance is at an all-time low of 20%, says Outa. It has no intention of giving up on the issue. Image: Moneyweb

Finance Minister Tito Mboweni gave no wiggle room for those looking to get out of paying their e-tolls bill.

He reiterated that government has decided to retain the user-pay principle and e-tolls on the Gauteng Freeway Improvement Project (GFIP) in his Medium-Term Budget Policy Statement (MTBPS) speech on Wednesday.

Strengthening e-toll payment compliance by motorists using the GFIP may, however, be the Achilles heel of government’s attempts to make the scheme work.

Mboweni urged motorists to pay their e-tolls, adding that there would be a further dispensation and value-added services while compliance would also be strengthened.

Read: E-toll accounts could be used to pay for parking, licence renewals

However, Wayne Duvenage, chief executive of the Organisation Undoing Tax Abuse (Outa), is uncertain how the government will enforce greater compliance when there are still outstanding court cases related to the implementation of e-tolls.

Duvenage said Outa has no intention of giving in on the e-tolls issue.

“The test case that has been developed over the past two years has been abandoned, or placed on hold for the past eight months by Sanral.”

Legal obstacle

“The court case is in the way and it has to happen. I think they are going to try some more carrot-and-stick approaches.

“They have tried them before with 60% discounts and threatened people with criminal records and their licences being withheld, they have summonsed people, they have threatened people with judgments – but nothing has worked,” he said.

Duvenage added that Outa had heard government in the past saying it would write off all the debt, provided motorists started paying now.
He said this might push up compliance from 20% to 30% or maybe 40% but that it would fail again over time.

“I don’t know what has to happen to get it into the brain of government that you cannot run a country against the will of the people,” he said.

“Sanity doesn’t seem to prevail.”

Duvenage said Outa is also worried by government’s determination to cling to the myth that the e-toll scheme is an efficient user-pay financial solution to settle the freeway upgrade bonds, when it was a failed user-pay scheme, it was not efficient, and it was fraught with corruption.

Motorists say no too

The Automobile Association (AA) in August reported that research it conducted revealed that more than 52% of motorists believe there is nothing government could do to convince them to start paying their e-tolls on the GFIP.

The association said 78% of motorists cited government corruption as the reason for deciding not to pay their e-tolls.

Read: Government corruption to blame for non-payment of e-tolls 

Duvenage said the reality is that e-toll compliance is at an all-time low of 20%.

He said it will be interesting to see how government proposes to address this, because it has failed to do so for the past six years.

“Why is it so important for them to cling to a system that is the most expensive scheme in the world, which reeks of corruption from the road upgrade to the ETC (Electronic Tolling Company) contract, whose profits enrich a foreign company?

“The roads cost 100% more than they ought to have and the ETC toll collection contract was inflated by 60% above the tender,” he said.

The AA on Wednesday said it was disheartened by Mboweni’s announcement that e-tolls are “here to stay”.

It said Mboweni mentioned that government had considered several options, but decided to retain the user-pays principle.

“We find it hard to believe that … submissions government received, from anyone apart from Sanral, supported the idea of retaining the current system,” said the AA.

“We have data that indicates users will continue not to pay, and that the system is doomed to failure should it be kept in its current format. 

“Compliance rates are lower than 30%, well below any accepted threshold for success. When we met the minister of transport in August we also noted that any amount of cajoling or threats of legal action would not convince non-payers to change their minds.

“Users have simply had enough and they are hard-pressed to make ends meet as it is. Retaining the current system is, in our view, the wrong course of action,” the AA said.

When it released its annual financial results last month, Sanral reported that low payment rates by motorists resulted in revenue it received from e-tolls on the GFIP slumping 63% to R687.7 million in the year to March, from R1.87 billion in the previous year.

The roads agency also raised an impairment of R10.04 billion on its total e-toll trade and other receivables of R10.96 billion at end-March.

Auditor-General Kimi Makwetu confirmed this was the value of expected credit losses by Sanral’s e-toll trade and other receivables at the end of its financial year.

 
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I will start paying the minute more than 90% of Soweto residents, and those in other municipalities, start paying for their electricity.

Me too I along with the 4% that pay tax have carried this country for long enough.

*Income tax.

Exactly. They too can pay for electricity and boost Eskom’s finances. And in case Mboweni cannot work it out, that is called “The User Pay Principle” – in his and the Governments own words.

As I totally agree with you, the question is how? A population who is fed on a diet of destruction as a means to get what they want? Talking about being between a rock & a hard place.

Scrapping the gantries and selling them for scrap will bring in some money!
Mainly, scrapping the hugely inflated running costs (and staff!) and royalties currently being paid will bring in many millions annually.
Then I am perfectly willing if license fees are increased to compensate.

the few people that are still paying e-tolls are the honest popholle that also pay their taxes,water,electricity etc. I’m one of those HP’s that are milked to death.

Maybe.. but at least you and I don’t have to worry when one day they come collect 😉 because when debts mount, they will come for you.

Eskom today is starting to cut off municipalities i see in news reports so fun times ahead. At the end of the day I think people forget that a hypocrite has no place asking for change. eToll legality was won in court so unless that changes I pay.

I personally do not hire people who can’t show me they pay their bills.. but then I work in finance where if u not paying whats required, how do we trust you?

Yip, I just love the fact that I pay to sit in traffic jams. There’s always a broken down truck at exactly the same spot, but satanral can’t seem to understand how to remedy this. I’d actually pay to drive in free flowing traffic…

I can’t understand why the taxpayers cannot sue the whole government for mismanagement of our taxes. The graft, the disappearing billions, the bail-outs of entities destroyed by cadre deployment are simply criminal and we just have to shut up and pay.
Enough is enough. We are like sheep meekly stepping along a no-escape path to the slaughterhouse and have no say. That is unacceptable.
Can the super smart legal guys not come up with a way that we can sue these destroyers???

Agree fully with you TheV!
Why don’t companies explore possibilities of withholding taxes paid to this criminal government? There must surely be a way that us tax paying citizens (be that the whole 4% of the population LOL)can demand proper and ethical expropriation of our hard earned taxes?
Go figure why so many are emigrating as they’re fed up with this fiasco. I’m one of them.

Agree 100%. It is a way better means of protest. Totally non-destructive. Should fall into a class action type of movement. It was recently shown to be successful for the sufferers of asbestosis. NGOs of all types should be lobbied by those with influence to pursue this type of thing. The media could become an effective catalyst too.

simply put, the ANC is the largest employer of people in SA in return for providing jobs it gets votes which it needs to stay in power. this is why it has been it has contiuued to bail out the debt rideen SOE’s. it is also in bed with the unions who will not allow the ANC to dismiss its members. so this unhealthy realtionship continues year in and year out. if every single ‘civil servant’ [a wonderful oxymoron] was to hav target driven contracts or just do their jobs the consequence would be a vastly improved SA for all. instead, we stumbled from Mbeki, to Zuma and now to Cyril. None of them have been very effective as captain of the ship, if anything they have actively sought out the proverbial iceberg and yelled out ‘full steam ahead’

Pay for what you use. It’s the right thing to do, whether you like it or not.

Yes it is, so go preach that to Soweto and every other municipality that has pocketed the residents payments.

That is the task of the corrupt ANC, who started this “non payment” campaign. Now the chickens have come home to roost.

The government can not afford for me to pay for what I use. I use little or nothing that the government provides so if I only pay for what I use I should pay nothing. If the tax payers stop paying for what they do not use there will be chaos in the country.

Would you buy from people who broke multiple laws to create their product and whose business was so inefficient that the cost of receiving your money exceeded the cost of production?

That’s what you’re doing when you pay e-tolls. You are actually funding lawlessness and waste, and exporting South African forex to Austria.

Hi Rob – calm down some – Drive a vette and relax bro!!!

From the mid 1960’s, Residents of Johannesburg, the former Transvaal province and surrounds PAID additional road taxes, extra fuel levies and other extorted monies to fund and improve the road systems 3 times. The eToll system is the 4th time. So NO! We will not pay again.

And if they throw the “User Pay Principle” at us again, then we the people from Gauteng will not want the taxes we pay to fund costs anywhere else but in Gauteng. Thjosew from KZN can fund their projects, those from the Eastern Cape theirs, and so on.

Exactly. The minister conveniently ignores the fact the Gauteng taxes subsidise every other province in the country, except perhaps the Western Cape. Gauteng taxpayers have already paid for everything they use, and much more to boot!

So road upgrades happened for free? is that what u saying ? When driving on the national roads to KZN just recently I paid tolls (well via eToll) too.. so uhm.. nope, they had toll gates as seen along the garden route too. Western Cape wine route.. not sure they went ahead with the upgrade at all.. i know they maintained road though.

My point is.. tolls roads exist, when the WC debacle happen many said why should someone on the other side of the country pay for something they don’t use.. and .. here we are again. Lastly.. I dunno if you actually know how goods get transited from GP to WC or WC to GP.. but guess what.. if they don’t use rail they use the eToll highway.. and .. they pay tolls.. so yes.. if they use things from here they pay eTolls.

And then when you expand you view point you will quickly realize that only silly companies have not factored the cost of eToll into their business i.e. passed it on to consumer.. so.. you can claim what u want.. but if goods and services originate in GP, others actually do contribute and its not solely GP.

Kashif, MBoweni. Stop talking your own book.

We’ll, I don’t use any corruption and so see no need to pay for it – and the whole construct behind e-tolls is corrupt.

So who’s going to fix SA’s potholed roads in 10 years time, you and your Outa?

I notice that my previous comment disappeared.
“[Mboweni] reiterated that government has decided to retain the user-pay principle”
This is uncharted territory for the ANC government.
The principle in this socialist utopia has always been that the taxpayers (individuals and companies) pay for every hare-brained scheme dreamt up by the communist ideologues.

Clearly they want civil unrest!

what sanity Wayne? People are screaming this economy is about to collapse and still not sanity. If they won’t listen on economic matters how can they possibly listen on eTolls? They overfed, arrogant, lazy, greedy and inept.

I guess the ANC has figured out that it can’t refund the bribe Kapsch paid for the privilege to ship hundreds of millions of rands out of the country.

I would say the tax revolt is here. TV licenses in line with e tolls already. Keep it going.

Would some journalist please ask Minister Tito to comment on the “User-Pay” principle when it comes to a) Eskom, b) SAA, c) SABC, etc. etc. etc. when he again raises it on E-tolls?

ANC was and always will be criminal organization.

Who exactly is OUTA? How are they funded and have they ever released information on what their directors earn?
There’s a slight niggle starting to develop around all the semi-political pressure groups/NGO’s and others who depend on the public support to survive financially.
I can think of the IRR, Afriforum, Helen Suzman Foundation and many others. Even news websites are starting to beg for financial support, which I can understand in these troubled times.
But what I can’t understand is why organisations like Outa are leading the campaign to boycott the payment of e-tolls, while at the same time urging people in places like Soweto to pay their Eskom bills.
Can someone please explain the difference to me?

You can’t be this dense.

I smell a SANRAL shill.

End of comments.

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