Sanral raises more confusion than clarity on e-tolls

The cabinet’s failure to make a decision on the funding of the Gauteng freeways is affecting long-term road planning and allows Sanral to avoid responsibility for its incoherent e-toll collection strategy.

More than a year ago – in July 2019 – the cabinet mandated a team to come up with a solution and promised a decision within two weeks. We’re still waiting.

In comments to the media this week, Sanral’s CEO Skhumbuzo Macozoma (see here) confirms that Gauteng’s e-toll compliance rate before the Covid-19 pandemic was at an unsustainable level of 20%, bringing in only R60 million a month. This is barely sufficient to pay for the administration of the scheme’s toll collections. Collections have not improved during the pandemic, with Macozoma saying that Sanral was now down R640 million on all toll collections.

However, OUTA is surprised that Macozoma appears to be equating the lack of revenue from the failed e-toll scheme – which is linked to just 186km of Gauteng roads – with the national roads backlog of R400 billion and hints that road maintenance will be reduced. Sanral is conflating the Gauteng upgrade with other national challenges they have and should not lay the blame of their funding woes at the doorstep of Gauteng road users who were rightfully defiant of a grossly inefficient and expensive scheme. 

The Gauteng eToll scheme is significantly different to Sanral’s other ‘boom-down’  toll-plaza collection mechanisms. In the first instance, Gauteng daily commuters were expected to pay for using urban roads, whereas the other toll schemes situated on national economic corridors are less intrusive on the cost of living for daily commuters. Secondly, if Sanral wants to introduce a drive-now-pay-later electronic tolling scheme in any city, it needs to ensure that these systems are workable, efficient and promote the public’s willingness to participate. They got this horribly wrong and collapsed the system through their own mismanagement and poor leadership.

“Mr Macozoma’s comments add more confusion than clarity when it comes to the future of e-tolls,” says Wayne Duvenage, OUTA’s CEO.  “We now have almost seven years of empirical evidence that the scheme was unworkable, yet Mr Macozoma still speaks in a manner that seeks the public to embrace e-tolls.”

OUTA has campaigned against the e-toll system long before it was switched on, as it was a grossly irrational and unfair burden on Gauteng’s commuters and an unjustifiably expensive scheme set up without public consultation. With or without OUTA’s intervention and its efforts to ensure public rights were heard, the Gauteng e-toll scheme was never going to achieve a high user-pays compliance level.

Macozoma’s comments illustrate Sanral’s inability to take responsibility for this failed scheme and the overpriced contracts that it signed, which have now expired.

OUTA does not object to the notion of privately funded road infrastructure projects which are done on a Build-Operate-Transfer (BOT) basis with the State. This is precisely what is taking place on the long distance economic corridors and these work because they are manageable through 100% compliance rates. What we are disappointed about is Sanral’s absolute lack of transparency on the revenues collected and what the public is paying for on these concessioned routes. 

“Road infrastructure financing is not an either-or situation as regards public funds and private user-pay BOT mechanisms,” says Duvenage. “It’s about a combination of mechanisms and applying those that work best in the right environments, and then being transparent about these schemes and taking the public and communities into their confidence.” 

Mr Macozoma says the right things when it comes to working in the best interests of the communities and people of the country, yet Sanral does little to demonstrate this when they defy OUTA’s call for transparency, as well as the Wild Coast community’s opinions on the N2 route and other communities who Sanral have ignored. “Mr Macozoma needs to demonstrate his willingness to engage with society in meaningful ways, not lip service.” 

“The public’s resistance to e-tolls was a self-inflicted pain brought about by Sanral’s poor research on why these schemes fail around the world. To add to their woes, Sanral’s overpayment at R18bn for the Gauteng freeway upgrade was more than double the price that should have been paid. Why don’t we ever hear them apologising to society for placing us under this unnecessary pressure and what are they doing about addressing the perpetrators of these crimes” says Duvenage. “In addition, to the overpriced construction costs, we uncovered that the e-toll collection contract increased without explanation by 61% after the tender was awarded and for years they misled the public on the eToll compliance levels. This is no way to win the trust of the public.”

The Gauteng e-Toll scheme would have generated almost 25% of Sanral’s revenue from 1% of its road network, had they got their way with the Gauteng road users.  This would have been a grossly unfair user-overpays scheme which Gauteng residents would have been milked to fund other projects that its users were not using. 

The quicker Sanral and the state accept their folly on the e-toll decision and that it will forever remain unworkable, the sooner they may decide to pull the plug on the defunct scheme.

More than a year ago Sanral effectively admitted the scheme had failed when it stopped pursuing e-toll debt.

We await the cabinet decision on the way forward.

More information

OUTA’s comments on waiting for the cabinet decision are here.

OUTA’s comments in 2017 about how Sanral paid R10.8 billion more than it should have for the Gauteng freeway upgrade – more double the price – are here.