You are currently viewing our desktop site, do you want to download our app instead?
Moneyweb Android App Moneyweb iOS App Moneyweb Mobile Web App

NEW SENS search and JSE share prices

More about the app

Cabinet delays decision on e-tolls till next year

Government is now looking at an ‘appropriate’ funding mechanism for road infrastructure countrywide.
It looks increasingly likely that e-tolls will be scrapped in favour of another funding mechanism. Image: Moneyweb

Government has delayed a decision on the future of e-tolls on the Gauteng Freeway Improvement Project (GFIP) until the first cabinet meeting next year, with it looking increasingly likely that e-tolls will be scrapped in favour of another road infrastructure funding mechanism.

Minister in the Presidency Jackson Mthembu said on Tuesday that cabinet had noted the report on e-tolls on the GFIP by the task team led by Transport Minister Fikile Mbalula and that a final decision on the recommendation of the task team, as contained in the report, will be made by cabinet in the new year.

Mthembu said the Department of Transport has done a lot of work on the options that are available and government is now discussing which are the most appropriate options, not only for the Gauteng e-tolls, but generally for improving the road infrastructure in the country.

Expanded mandate

“We expanded the mandate of the department to look into all these matters of Gauteng e-tolls and how do we use whatever mechanism we will agree on to also improve our road infrastructure throughout the country, in our rural provinces and everywhere else,” said Mthembu.

“At first their [task team] mandate was how do we fund the e-tolls in Gauteng? Do we reduce what we are now paying or do we do something else?

“But with time it was then added that can you also look on how do we improve our road infrastructure everywhere and what mechanism of funding should we be looking at. That is what the cabinet has to finalise.

“We can assure you that when cabinet meets next time in the new year it will finalise this issue,” said Mthembu.

“We will give South Africa an idea about what we are going to do with the Gauteng e-tolls but secondly we will also give South Africans an idea on how are we going to improve our road infrastructure throughout the country.”

Mthembu said all the public is being alerted to is that government is dealing with e-tolls on the GFIP but that “the decision that cabinet might ultimately arrive at might go beyond GFIP”.

“I think you will also be very proud of the options that cabinet would have agreed on,” he added.

Organisation Undoing Tax Abuse (Outa) CEO Wayne Duvenage believes there is a strong possibility cabinet will take a decision to scrap e-tolls on the GFIP in January but that Finance Minister Tito Mboweni will announce the decision in the budget in February, along with details of how it intends to finance the GFIP and other road infrastructure.

Duvenage believes this is why Electronic Toll Collection’s contract to manage e-tolls was extended for three months rather than a year.

He says it’s a good thing that government is having a discussion not only about the future of e-tolls but road infrastructure funding more generally, as well as the cost of road construction in South Africa.

Duvenage points out that 33km of a new road between Durban and Richards Bay was built for R10 billion. “There is something wrong with that price. We reckon that price is about 25% over what it should be.

“We are paying more than we should just for road construction. You cannot divorce road construction from the cost of road funding. It’s a problem.”

According to Duvenage, the SA National Road Agency (Sanral) was getting R5 billion a year from National Treasury 12 years ago, and is now getting R15 billion.

“It’s gone up 200% in 12 years. Something is wrong.”

Duvenage says nobody is denying the fact that government needs to continuously look at road funding around the country, but the problem is the 156km in Gauteng with its failed e-toll scheme. Government should, as it indicated it would, have made a decision on e-tolls long ago.

‘Fuel levy funding more than just roads’

Duvenage says government is getting R74 billion a year from the fuel levy,  R15 billion of which goes to Sanral, with further amounts going to the provinces – but every single year in February the fuel levy is increased by between 20c and 30c a litre.

Read: Petrol pump or cash cow?

He says the money needed for road infrastructure is available – but the money raised from the fuel levy is being used for general finances “because the country is in a mess and the fuel levy is funding more than just roads”.

Duvenage says the fuel levy is now the country’s fourth-biggest tax revenue stream and, as with all other taxes, is a tax on the people.

 

AUTHOR PROFILE

VIDEOS

COMMENTS   9

Sort by:
  • Oldest first
  • Newest first
  • Top voted

You must be signed in and an Insider Gold subscriber to comment.

SUBSCRIBE NOW SIGN IN

What amazes me is that this country is still standing after all this mismanagement. High taxes, petrol levies, over paying on everything the government buys, creaming of the top, bailouts of SOE’s. How much longer can we go on?

Stop stealing, that will be a good start. Then, stop being corrupt – what is the purpose of the fuel levy afterall?

We had this ponzi scheme driven by Herman Pretorius, and called Abate Capital, in the Western Cape. This ponzi scheme offered about ten different ventures, or investment opportunities, but that was one huge smokescreen. All the investments disappeared into the same ponzi scheme.

Now, with Ramaphosa’s ANC, we have exactly the same situation. They mislead us with e-tolls, SAA, Eskom, Prasa, Denel etc but the money disappears into the same ANC ponzi scheme. This ponzi scheme is called Luthuli House. It is sinking the economy and stealing the purchasing power from consumers.

The courts will have to save the country and put an end to the looting. The country needs to be put into business rescue.

Until we have a system that produces an honest hardworking government with a team dedicated to work for the electorates needs and not just for the benefit of their comrades and families, no SOE will work, and no improvement will happen in the affairs of this lovely country. Collecting overly high taxes so that a few greedy politicians can eat at the troughs, damages the credibility forever as does training the general population to feed at the trough with more than 17 million social grants monthly. 17 million is fairly close to one third of the population being given a social handout every month. Surely this is close to a world record?

What you are wishing for will be a good start, but we also need to get rid of the outdated communist/collective philosofy/policies that is strangling the economy such as BEE, EWC and all the rest of the alphabet soup.

Afraid that won’t mean much until you have a voter base serious about getting services delivered to them (instead of just grants) and holding politicians to account. Suck with compatriots who display no courage and or backbone.

Conclusion: The decision has been taken. The funds need to keep flowing into Lootfree House and therefore the news for taxpayers and road users is bad. If this were not the case the decision would have been announced before Xmas – to earn the pat on the back.

The political mindset needs to change so that doing the job of a minister is the aim rather than just becoming a minister.
The actual level of the “improvements” for the GFIP were minimal in fact in 2017 Alex van Niekerk (Sanrals’ Planning and Toll Manager) said that the GFIP was almost at its’ capacity. We pay our taxes, an ever increasing fuel levy and our vehicle licenses and yet Sanral still can’t do the job.
A retired roads engineer from the UK said on 702 that the norm there when expanding a road is to allow for the next 30 years. The GFIP completed in 2010 and nearing its capacity in 2017 sound like a R27 billion stop-gap.

ANC: catch a wake-up. Stop trying to fund your corrupt Luthuli House with the income from just 156 km of roads in Gauteng. Why? Because the e-toll deal was crooked from the start, done with overseas companies PROVEN to have paid bribes. Because around 75% of drivers who use the e-tolled roads are NOT paying. Because people have emigrated, cars have been sold and resold, post boxes closed so people aren’t getting their e-toll notices. The whole thing is a crock of sh#t and has now come back to bite you on the bum. Use the petrol levy for ROADS and the whole problem will be solved.

End of comments.

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
BTC / USD

Podcasts

INSIDER SUBSCRIPTION APP VIDEOS RADIO / LISTEN LIVE SHOP OFFERS WEBINARS NEWSLETTERS TRENDING

Follow us: