E-tolling contractor paid R25m a month

Sanral has to pay the company implementing e-tolling around R25 million a month, even though e-tolling has not yet begun. At a media briefing on Thursday, Sanral communications manager Vusi Mona and Gauteng Freeway Improvement Project (GFIP) manager Alex van Niekerk explained the agency’s financial situation. Van Niekerk said Sanral was ready to go ahead with e-tolling and was waiting for President Jacob Zuma to sign the Transport Laws and Related Matters Amendment Bill. It has been more than two years since e-tolling was first expected to begin in Gauteng. Mona said the agency was cautious about estimating timeliness. Van Niekerk said that at present they were in a “soft-tolling phase”, which meant that the system was live-testing, but was just waiting for the go-ahead from the president to start sending out invoices.

The project manager said they were paying the contractor - Electronic Toll Collection (ETC) - around R25m a month for services such as maintenance of the system, building costs, taxes, banking fees and employee salaries. He would not say what the company would receive once e-tolling went live, saying this depended on how many motorists bought e-tags and paid their tolls. Van Niekerk said they had costed in both extremes - the first is that the project will be smooth sailing and everyone gets an e-tag, and the second is that people do not co-operate and there will be postage, call and debt collection fees. He said they were ready administratively for both situations. “We have planned to handle the volumes,” Van Niekerk said.

Because e-tolling has been delayed, Sanral has not been able to raise bonds on the open market. Mona said recent press reports that Sanral was broke were incorrect. This was because 84 percent of the agency was funded by the Treasury and did not consist of toll roads. A large portion of the remaining 16 percent were toll roads owned by concessionaires. It was the 1 800km of state toll roads that were facing financial shortages. Mona said the agency needed to raise R1.48 billion to pay off its debts and it was going to approach commercial banks to help it do this. In the meantime, the agency was halting all tenders and future projects to stop it incurring more debt. Van Niekerk emphasised that road maintenance on tolled roads would continue.

“We are reaching a stage within the next three months when (finances) will become critical,” said Van Niekerk. Sanral is losing R200m every month that e-tolling does not go ahead. Van Niekerk said they had to cancel big capital expenditure projects such as upgrades along the N1 north to Beitbridge, a ring road around Polokwane and a ring road near Musina. He said that until they could raise money on the markets again, they could not go ahead with phase two of the GFIP, which is the building of 150km of highways in Gauteng. “It will cost R100m for every kilometre built,” he said.

The road travelled so far:

Apr 1998: Gauteng produces document on toll road strategy.

Oct 2007: GFIP launch. Sanral publishes notices of intent to toll on GFIP.

Feb 2008: Transport minister approves GFIP tolling.

May 2008: Sanral awards GFIP contracts.

June 2008: Construction starts on GFIP phase 1.

Sep 2009: Construction of e-toll gantries starts.

Feb 2011: First toll tariffs issued; later transport minister suspends implementation of tolling.

Aug 2011: The cabinet approves new e-toll tariffs.

Oct 2011: Transport minister postpones e-tolling; Sanral says e-tolling will start in February.

Nov 201: Sanral starts e-toll registration.

Jan 2012: Sanral says e-tolling won’t start in February.

Mar 2012: Opposition to Urban Tolling Alliance challenges e-tolls.

May 21, 2012: The Treasury and Sanral appeal to Constitutional Court.

Nov 2012: The Pretoria High Court hears a review on e-tolling.

Dec 12, 2012: The court decides e-tolling must go ahead.

Jan 26, 2013: Appeal into the Pretoria High Court’s judgment of e-tolling goes ahead.