REASONS AND MERITS OF OUTA’s CASE TO OPPOSE AND CHALLENGE E-TOLLING OF GAUTENG’S FREEWAYS
SANRAL’s proposed plans to apply an electronic tolling (e-Toll) process to Gauteng Freeways has been labeled by OUTA is irrational, unreasonable and impractical. It was most certainly not planned with the best intentions for the public in mind. This became more evident as OUTA’s members engaged rather intensively since 2010 with SANRAL, after learning about their plans to tax the Gauteng motorists through a most elaborate system of gantries, systems and strategies. The more we engaged, the more we realized that this plan of SANRAL’s did not attract the necessary levels of engagement and planning that a process of this magnitude required. We also learned that SANRAL had taken on something far more complex than they could handle and that it was fraught with inefficiencies, was extremely costly and they ignored far simpler methods to collect revenue for this project.
BELOW ARE A NUMBER REASONS AND GROUNDS THAT WE OPPOSE THE TOLLING OF GFIP ROADS?
- E-tolling of GFIP is irrational and unreasonable. Tolling Gauteng’s freeways is an unnecessary waste of billions of SA Tax payer’s money. We do realise the need to pay for the freeway improvements, but we expect to do so through efficient means to collect these “taxes”.
Raising additional funds for costly road projects of this nature, should be done via highly effective funding mechanisms. The planned installing an elaborate and complex toll (tax) gantry collection system for this specific project, means that users will pay not only the expense of the road construction but additionally, they must suffer the heavy and unnecessary burden of this specific toll collection system.
It is estimated that the electronic tolling processes planned by SANRAL will cost R1,7billion per annum (based on the tender awarded by SANRAL to ETC for this work, at R8,4bn for the first five year period, plus set up costs) just to operate and administer, while the road construction capital costs of R17bn, if paid over 20 years with interest, amounts to approximately R1,62bn per annum.
E-Tolling in Gauteng will raise over R100bn (216% of the required amount) and will be a burden to the road user – an utter unnecessary waste of their money. Click here to see spread sheet for calculations.
- Gauteng’s freeways are not new routes. These are existing routes which required upgrading following years of infrastructure neglect and a rapidly growing car park. The work done is expected from taxpayers of their elected authorities to conduct through medium and long term planning and provisions for growth. To develop a society over decades along these freeway routes and then introduce an additional tax for use thereof is tantamount to extortion, especially in the absence of alternative public transport services and routes. These routes were originally built with taxes already paid.
- Poor planning and incorrect information used when deciding to e-Toll: In the High Court papers files by SANRAL and the Department of Transport, initial estimates of the e-Tolling revenue collection process were R200 million per annum. These were the figures presented to the Minister of Transport (Min Jeff Radebe) at the time of the decision to toll. This was done with no scientific calculation and in the end, the tender was awarded at R1,7bn per annum (or R8,4bn for 5 years), some 850% higher.
- There are no viable alternative routes. While we know there are peripheral roads alongside and close to the highways, however, to expect any diversion of current freeway traffic onto these roads, which are already highly congested and rapidly deteriorating, will lead to traffic chaos.
- There is no effective and reliable public transport option. Earlier communications and plans for e-Tolling, by authorities, indicated that paramount to the e-Toll process was the implementation of an efficient public transport system. This alternative is almost non-existent for most of the current freeway users.
- The ‘user pay principle’ In order to justify their stance, SANRAL and the authorities now motivate a “user pays” principle as the motivation behind the tolling of the GFIP, as opposed to funding this upgrade through the national fuel levy. In other words, why should the rest of the country pay for Gauteng’s roads? This is our response to their argument:
- Benefits that arise from GFIP flows through to the entire country and not just Gauteng residents. Farmers get their produce to the markets and airports using Gauteng’s Freeways. Business and individual prosperity increases from improved efficiencies in transportation of people and goods through the economic heart of the South Africa. This generates more taxes for the country. Equally, road improvements in other parts of the country will help Gauteng. These are South Africa’s roads, not just Gauteng’s roads.
- Gauteng contributes more than their fair share of taxation and revenue to the National Treasury. Gauteng’s tax payer contributions to the national treasury is some four times more than it receives in return from treasury. Gauteng residents do not bemoan this and realise that the Government needs to distribute the wealth from the economic hubs into the entire country infrastructure and wellbeing for all. But if you are going to push a “user pays principle”, then on this basis, Gauteng citizens have more than paid for their freeway improvement. (Click here to read more about this)
- In the e-Toll model, not all users will pay for the use of the Gauteng freeway network. Some such as taxis (which are not public transport) will receive “free passage” while others will simply not comply. In addition, SANRAL has now capped the maximum amount at R550 per month. Thus someone who uses these roads extensively and well beyond the cap, will not be paying for this “extra” use. Not a true user pays principle now is it.
- Non-compliance is a serious issue in South Africa and an unfortunate blemish on our society’s image. It is estimated that less than half (some say 75%) of our regions traffic fines are not paid. We also estimate that Gauteng has around 10% incorrect or cloned number plates on vehicles using our roads. This will push the payment burden onto the compliant citizen and will also further exacerbate the problem as more will no doubt turn to fitting incorrect license plates. In a society where this unfortunate behaviour exists, it is best to push collection to an ‘upstream’ level (such as through the Fuel Levy), where it is ‘untouchable’ and efficiently applied and distributed. SANRAL says that cloned number plates will not be a problem if your vehicle is fitted with an e-Tag. We disagree as the same colour and make of car with your number plate will send gantry bills to your registered account with SANRAL – tag or no tag, and the innocent party will have to raise the dispute and request for refunds. The administrative burden placed on motorists to check their accounts, movements etc is another uncalled burden caused by e-tolling.
- This is an “Owner Pays” and not “User Pays” system. Part of the problem and administrative burden of this system, is that the vehicle owner and not necessarily the user will be picking up the bill from these gantries.
- Lack of consultation and transparency: While SANRAL will have us believe that they did all they could to be consultative in this decision, the simple truth is they failed and fell far short of what would be expected in a matter of this magnitude. This was demonstrated by the outrage and surprise that virtually all citizens expressed when the gantries went up, and not only the individual road user, but also business and large fleet organisations were shocked by the extent and implications of the SANRAL e-Toll plans. Our legal challenge has shown that SANRAL did the bare minimum to expose and consult on their elaborate plan to toll the Gauteng freeway upgrade. From over 3 million motorists in Gauteng, SANRAL received only 28 responses to their notices (one was a petition with 55 signatories), and they claim to have engaged. This was an absolute failure on their behalf, but alas, they don’t see it that way.
- Alternative models of funding – There are less expensive and far greater efficient processes for road funding. We believe the funding of our entire road network system, including upgrades to urban freeways should be conducted through the hybrid of user pays initiatives as follows:-
- The national treasury: There is no doubt that the entire country benefits from a good road infrastructure, even if one does not use the roads and as such, the national treasury needs to be an important contributor to the funding of roads.
- Fuel Levy: There is no doubt that the road user should also contribute toward our roads, more so than a non-road user, therefor the fuel levy was introduced in the mid 60’s. Today, the average cars fuel tank fill contributes around R135 toward the levy which helps maintain and build our roads. In reality, this (R45bn+ per annum) simply goes into the big treasury pot, but ultimately, treasury directs this toward roads.
- Long distance Toll Roads: There is no question that when constructing new rural and inter-city roads in the past – to bypass the longer and more dangerous single lane routes – a tolling process is justified as it offers clear benefits road user, who also have the option of using the (now shorter and less congested) alternative route for free. Today we (SANRAL) earns billions from these rural tolled routes and these funds subsidise the general road funding pot.
- Vehicle license fees: Revenues generated by the sale of Car Licenses at the local level are (supposed to be) utilised to fund road maintenance and infrastructure development within the local municipal and metro areas. These fees have been increased significantly (30% +) in recent years and the benefits to the local road user are not being at the levels expected from the local authorities. Nonetheless, these fees are also part of the road funding hybrid model.
THE WAY FORWARD
Understanding the logic and issues above, OUTA and its thousands of supporters are of the strong opinion that e-tolling of GFIP is fundamentally flawed, has been introduced unlawfully and is a most unjustified and unfortunate decision taken by the authorities. It is most certainly not in the best interests of the citizen and works against the ultimate role that governments need to play – i.e. to enhance (as opposed to detract from) the wellbeing of its citizens.
OUTA and its members have embarked on using the courts to exercise a legal challenge to halt the eToll implementation, in its current form. While Part A of our application (to seek an urgent interdict to halt the launch of e-Tolling before the planned launch date of 30 April 2012) was successful, Part B of the case from 26 to 28 November 2012 was not, as per the judgement handed down on 13 December 2012. The members of OUTA and their legal team are confident that the judgement was significantly flawed to warrant an appeal, the process of which is underway.