The GFIP debt and Gauteng’s portion make no sense
We read the National Treasury’s statement of 3 November 2022 regarding the Gauteng Freeway Improvement Project (GFIP) debt with disbelief.
While Sanral may have a total debt of R45.936 billion, we cannot accept that R43.031 billion of this is attributed to GFIP, especially as the Sanral court papers reflected in early 2012, when the GFIP construction was virtually complete, that the GFIP capital cost amounted to R20.63 billion.
We also know that Sanral’s liabilities in their 2012 financial statements reflect their capital market long-term bonds at R28.4 billion, and the total value of these bonds cannot all be attributed to GFIP.
We also know that according to Sanral’s financial statements since 2012 through to 2022, National Treasury has allocated R22.4 billion to Sanral for the financial management of the GFIP debt.
This suggests that something is fundamentally wrong with Treasury’s statement that Sanral now has R43 billion debt relating to GFIP.
"We believe that the numbers that are being presented by Treasury and Sanral are wrong. The GFIP debt is not R43 billion," says Wayne Duvenage, OUTA CEO.
“Even if Sanral did not settle R1 of the initial capital debt or the interest accrued, a bond of R20 billion over the past 12 years at 10% interest will not amount to more than R33 billion,” says Duvenage. “The question we need answering is: what has Sanral done with the government grants received for GFIP over the last decade?”
It is important that the Gauteng provincial government and National Treasury do not allow themselves to become hoodwinked by these numbers that are being provided to them by Sanral. What is actually required in an in-depth look into Sanral’s financials, including how much was borrowed for GFIP and how Sanral allocated the grants received from Treasury over the years.
There is too much smoke and mirrors related to these numbers provided by government. Sanral and government have indicated that the GFIP debt was not ringfenced, but that is not what was presented in the court cases which OUTA fought in 2012.
“What we now need is absolute transparency and clarity on the accounting principles that Treasury and Sanral have assigned to the numbers they are presenting to the public,” says Duvenage.
OUTA also notes the statement made by Gauteng Premier Panyaza Lesufi on how Gauteng will pay its share of the GFIP debt, and the undertakings to consult with the public on this.
"OUTA welcomes the Premier's statement that e-tolls will not be used as a mechanism to finance whatever portion of the debt that Gauteng is being asked to pick up," says Duvenage.
“We look forward to engaging with Premier Lesufi on his consultation process on what the extent of the debt is that they should commit to and how it will be paid."
A soundclip with comment by OUTA CEO Wayne Duvenage is here.
OUTA has been opposing the e-tolls for a decade. See more on OUTA's work on e-tolls, including an e-tolls chronology, here.
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