As the municipal elections in South Africa draw closer, e-tolls are back on the agenda. OUTA CEO and founder Wayne Duvenage has been the chief protagonist against e-tolls since before their inception. He joins BizNews founder Alec Hogg to discuss the issue of scrapping e-tolls for good. According to Duvenage, despite growing evidence of failure, as well as OUTA’s attempts to suggest alternatives and solutions, the government seems hesitant to make a decision. “There’s nothing preventing them. They can reverse the law. They can switch off the system tomorrow. They can put it to other use, by the way, use it for average speed over distance monitoring, traffic fines, looking for stolen vehicles, law enforcement. There are other uses for those gantries, but as far as e-tolling goes, it’s just a no-brainer.” – Claire Badenhorst
— OUTA (@OUTASA) October 8, 2021
Wayne Duvenage on why e-tolls are a difficult issue to resolve:
Yeah, it’s very strange. You must remember that initially the provincial government supported this decision. Nomvula Mokonyane was the premier at the time and the ruling party through [to] national government – everybody was on board with this plan, this idea that was sold to them by SANRAL that it was workable. All our research said otherwise. We tried to stop this in court, [it] became very messy and technical and so we had to challenge this in a number of ways. The one way is to say, well, there’s a collateral challenge opportunity and we’re going to defend the public if they are ever summonsed with e-tolls, which is what we set out to do. Government abandoned this test case, the massive amount of cases that they were trying to summon, and ever since then, they’ve been unable to enforce their own laws on the e-toll matter.
They cannot blacklist you. They cannot withhold your licenses. They cannot criminalise you. They cannot force you to pay. So they have a law that they can’t even manage, and the compliance rates have been, for a user pays scheme, sitting at below 15%, now we estimate even closer to probably 12% of people paying for a user pays scheme – well, that’s collapsed. So the question you ask is why are they taking so long to make this decision? And that’s the question we’re asking of them because we’ve provided them with alternatives, with the solutions, which, by the way, they’re already applying, they’re getting the money from Treasury, which is where the money should have come from right in the beginning. And yet they still continue to kick this can down the road.
The provincial government has now turned its back on e-tolls as David Makhura came into power in 2014, and the scheme has now proved fruitless. It’s just a waste of time. It’s barely covering the administration costs. So we cannot understand why they can’t make a very simple decision and reverse the original plan and fund these roads because we have to fund them through treasury receipts. The fuel levy feeds into that by the way. Had they done what we suggested many years ago, they would have already paid for the bonds 10 cents up in the fuel levy, and they’ve already increased the fuel levy by over R3 since then, so they’ve got the money. They’ve got the ability, these are government-backed bonds – they can finance them through government. It’s minuscule in the greater scheme of things – it’s far smaller than the way Eskom and other entities are. It beats us other than maybe, maybe some entities, maybe some service providers who are providing services to [the] electronic toll company are enjoying some of this revenue.
On what could be stopping the government:
It’s a good question and some people have put it to us, ‘but, you know, to cancel the contracts is too expensive’, but that doesn’t fly because the ETC contract has expired. They expired two and a half years ago. So there’s no contractual obligation, there’s no penalties, there’s no fees, there’s no money that’s going towards the bonds. In other words, another argument could be, but if you scrap it, then they’re in a worse-off position. They’re not because the money they’re collecting, which was R650m last year, all of it went to ETC to collect that money. So all you do is pay for the collection. That amount dropped the last financial year to R453m for the year. So they’re even worse off, and I know Covid might have had something to do with that because there was less travel on the roads, but nonetheless. So there’s no contractual obligation. There’s no lost money to the bonds. There’s no reason why they cannot scrap the scheme. All it means is that the minister has to reverse the decision that was made by Minister Radebe at the time in 2008, and that is to declare the Gauteng freeways non-toll roads. It doesn’t do anything negatively in that regard. Nothing at all. So we can’t understand.
You know they’re not collecting any money for maintenance from e-tolls. With less than 15% paying, as I said, they’re only collecting to pay the collectors. There’s nothing preventing them. They can reverse the law. They can switch off the system tomorrow. They can put it to other use, by the way, use it for average speed over distance monitoring, traffic fines, looking for stolen vehicles, law enforcement. There are other uses for those gantries, but as far as e-tolling goes, it’s just a no-brainer to stop tolling because I think the minute they do stop tolling, by the way, there’ll be a bigger uptake for the tags, for the long distance tolling routes that people would want to use so that they can get through those stop-and-go toll plazas a lot more efficiently.
It would be in the government’s best interest to stop this so why they continue with it, we don’t know, other than possibly government has been dealt a blow by civil society. Possibly government doesn’t want to acknowledge and admit that civil society has called them out, stood their ground, run a civil disobedience campaign against their own laws and won. That might not be good for politics. Who knows? But to continue kicking this can down the road and allowing R40m or so to be paid over to ETC to pay for themselves and their service providers. Maybe there’s a couple of companies that are enjoying some of that revenue, but it’s certainly not the R300m that they needed to make this scheme work. It’s a pittance.
On government tier discrepancies between national and provincial:
Well, I think at a national government level it’s a little bit more complex in that you’ve got finance, you’ve had various finance ministers. I think they’re grappling with this concept. Maybe they don’t know all the issues, and I’ll tell you why I say that, is I remember conversing with somebody in Treasury a little while ago who said, look, we can’t stop this scheme because it’s going to just be too expensive to get out of the contracts. And I explained to the individual that’s not true because the contracts have expired. There’s no penalties. He was quite taken aback by that. He said, but that’s not true. I said, well, you show me otherwise. Here’s the contract. It’s a five-year contract that was up in 2019 – we’re now in 2021.
You know, so there’s no contractual obligation. So I think there’s a bit of confusion at Treasury level. You know, another thing is that Treasury, through the Department of Finance, has already been funding SANRAL for the Gauteng freeway improvement bonds. They have been giving them over R11bn in the last number of years. It’s in their financials. So it’s not as if they haven’t been funding them, and they found that revenue and the money’s coming through the fuel levies. Remember, Gauteng gives National Treasury about 36% of its receipts. This is the economic powerhouse of South Africa and yet this is a small province, a small amount of roads we more than pay. So the arguments are there. Everything is in their favour to say, listen, Mr Citizen and Mr Gauteng Citizen, we are going to reverse a bad decision.
On why we should be concerned about it:
Well, that’s a very good point, and that’s exactly what we’ve been saying time and time again. It actually is irrelevant whether the government scraps it or doesn’t scrap it because the people have spoken. Nobody’s paying. There’s nothing that government can do about it. In fact, when you ask a lot of the public out there about e-tolls, some of them say, is this still an issue? Why are we even discussing this? So your point is a very valid one, and we say it doesn’t really matter what government does because the public have won on this and government can do nothing about it.
But the question you’ve got to ask is while the law still exists and while there are still 12 to 15% of people paying, there’s still a concern. In other words, there are some companies that pay because they just want to abide by the law because government taps them on the shoulder if they stop paying because SANRAL runs to them and say, oh, these guys, you know, take them off the procurement list for government. So they pay but now they’re uncompetitive to other companies that have said we’re not paying and they’re still getting business out there. Even some government departments are still paying – that’s your and my tax revenue being wasted, where a lot of other government departments aren’t paying.
So we need to get finality just for that sake, you know, so that everybody can stop paying and that the few that are paying feel they don’t want to stop paying because they don’t want to break the law for whatever reason. That’s what has to happen. Government must make a decision and stop. But for the 85% of the citizens out there, it’s a no-brainer. They just move on with their lives knowing that OUTA’s got their backs if they are summonsed, and if they’re not summonsed, nothing’s going to happen to them.
Biggest Joke Ever: @MbalulaFikile doesn’t want to drown SA in debt over e-tolls. No-one (but 15%) still pays & Treasury allocates SANRAL funds to cover eToll debt. Could corruption be the reason eTolls limps along? https://t.co/ujxLxigmlc
— Wayne Duvenage (@wayneduv) September 28, 2021
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