The fate of e-tolling in Gauteng remains uncertain as the South African National Roads Agency (Sanral) grapples with unresolved issues, and the government debates the future of the controversial system.Despite efforts to settle outstanding debts, significant questions still loom over this divisive road infrastructure funding model.
In Sanral’s recently published annual report for the 2022/23 financial year, it highlighted the persistent uncertainty surrounding e-tolls and the Gauteng Freeway Improvement Project (GFIP). The agency expressed its optimism that the government would ultimately settle the debt, but crucial agreements and conditions have not yet been finalized to scrap the e-toll system.
Special Appropriation and Debt Settlement
The first glimmer of hope for a resolution emerged on October 26, 2022, when the Minister of Finance announced a Special Appropriation of R23.736 billion for the 2022/23 financial year to settle maturing debt and debt-related obligations associated with the toll portfolio. The Gauteng Provincial Government and the national government reached an agreement to split the GFIP debt in a 30/70 ratio, which was expected to lead to the eventual demise of the system.
Two tranches were allocated to Sanral for debt settlement. The first, totaling R8.980 billion, was received in January 2023 after the Special Appropriation Bill became law. The second tranche of R14.76 billion was disbursed on March 31, 2023. However, Sanral noted that not all transfer conditions had been met by the year-end, and therefore, this amount couldn’t yet be recognized as an equity injection on its balance sheet.
E-Tolls Remain on the Books
The consequence of these unresolved conditions is that the e-tolling system, along with its related debts, continues to appear on Sanral’s balance sheet. The tolling on GFIP also persisted until the end of the financial year, requiring a gazette to officially cease charging toll fees to road users on the 201km stretch in Gauteng.
E-Toll Non-Payment: A Stalemate
Perhaps the most intriguing development is that while the e-toll system remains operational from a regulatory and technical perspective, Sanral is not pursuing motorists who have failed to pay their e-toll bills. All of the historic e-toll debt, amounting to 100%, has been impaired, effectively writing it off.
Furthermore, Sanral has not issued summonses to the public since March 2019, reflecting a position taken by the board. This change was a response to the Minister of Finance’s announcement in October 2022, indicating that the outstanding GFIP borrowing would be covered by the government. The resolution of the agreement between the Gauteng provincial government, National Treasury, and the Department of Transport is expected to dictate the way forward for debtors.
The collections of old e-toll debt have also been notably low, with a recoverability rate of less than 1%. Given the uncertainties surrounding the future of GFIP and the existing debt, Sanral has deemed the Vehicle and Payment Card (VPC) debt as irrecoverable. As a result, the default rate has been set at 100%, aligning with prior years.
Government’s Next Moves: Debts and Refunds
Recent statements from the National Treasury have raised concerns that, despite Sanral’s inaction, the Gauteng government may attempt to recover this historic debt. In response to a Parliamentary Q&A, Finance Minister Enoch Godongwana revealed that the e-toll system would only be deactivated once a binding agreement is reached between the Gauteng Provincial Government and the National Government regarding the province’s financial commitments to settling the debt.
Outstanding issues include determining provincial funding sources for backlog maintenance and network rehabilitation, as well as defining the costs associated with collecting funds from defaulting road users who neglected to pay tolls while the system was operational. This suggests that those who have not paid their e-toll accounts over the past decade may still be liable for settling their debts.
It’s worth noting that Godongwana’s statement contradicts earlier comments from Gauteng Premier Panyaza Lesufi, who had suggested that e-toll payers would be refunded. In August, the Department of Transport also indicated that no plans were in place to shut down the system, further adding to the confusion and uncertainty surrounding the fate of e-tolls in Gauteng.
As the government grapples with these financial and administrative challenges, road users in Gauteng remain in limbo, unsure of whether they will be held accountable for unpaid e-toll bills or if a resolution will be reached to finally put this contentious chapter behind them. The road ahead for e-tolls in Gauteng remains as uncertain as ever.
