Tag Archive | Gauteng Freeway Improvement Project

Bumpy road for e-tolling Bill continues

E-tolling finally makes it through Parliament…

Discontent was expressed once again regarding the Transport and Related Matters Bill regarding e-tolling when opposition members complained that the Bill had been classified as Section 75 for national competence only, therefore denying the National Council of Provinces the process under section 76 of the Constitution whereby the Bill and its contents could be debated and approved at provincial level.

Johannes Makgatho, department of transport, told parliamentarians of the select  committee on transport, NCOP, that when the South African National Roads Agency Limited (SANRAL) Act was promulgated, electronic toll collection (ETC) was not envisaged in its current form. The development of the Gauteng Freeway Improvement Project (GFIP) had necessitated ETC and the Bill was necessary.

Sanral goes big on bonds

road tollsThe Bill was described by DoT as being of vital importance for the collection of tolls, the lack of which would have a negative impact on the ability of government to raise capital for their infrastructure projects. SANRAL had issued bonds to the tune of R24bn and the inability to collect tolls to repay the bonds would imperil the state guarantee provided to SANRAL, Makgatho said.

Ms Suraya Williams, Principal Law Advisor from the Office of the State Law Advisors, told the committee that that the regular ‘substantial measure’ test was applied to the question of whether the Bill should be tagged under section 76 for provincial debate but according to this established constitutional process, the Bill had been found to be a Section 75 Bill.

Who has heard of Cross Border Agency?

The Democratic Alliance said that it did not object to e-tolling in principle but considered there was a lack of public participation on the project and the process of e-tolling as a whole and this was unacceptable. Also all funds were to be collected by a body known  as the Cross-Border Road Transport Agency, which they said was a relatively unknown entity and were deeply concerned that this body was competent.

The DA added that this state entity had already been found unable to handle its own finances and got into difficulties handling just cross-border taxi industry matters. Mr Alex van Niekerk, Manager of the Gauteng Freeway Project for SANRAL, said the Cross-Border Agency had indeed experienced much difficulty initially with vehicles entering the country and travelling on roads which had not been tolled, but they had now built up experience with e-tolling and were ready for GFIP and national e-tolling as it built up.

Like cellphones

Mr van Niekerk explained that e-tolling would replace conventional toll plazas and that tolls would be recorded electronically in reference to barcodes which recorded the type and status of the vehicle in the same manner as prepaid airtime on cell phones. Existing toll plazas would remain but rather than manual payments, the plaza would read the tag and give access if there was credit on the account.

He said the principle of tolling did not change at all, only the mechanism of tolling changed and “non-compliance at the time of travel could therefore be remedied after the fact.” No profit, he added, would be made by SANRAL in the collection of toll revenue and he added that technology for the GFIP was considered “cutting edge”.

The Bill has now achieved NCOP concurrence and has gone forward for final reading. It then goes to President Zuma for assent.
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Posted in Finance, economic, Public utilities, Trade & Industry, Transport0 Comments

Transport Laws Bill enabling e-tolling tabled in Parliament

Public hearings to be scheduled

The minister of transport has now tabled the Transport Laws and Related Matters Amendment Bill in Parliament, the department of transport department having gazetted a notice announcing such intention in early August this year and obtaining cabinet approval for the Bill that month.

The Bill provides the South African National Roads Agency Limited (SANRAL) with the necessary legal structures to enforce e-tolling, SANRAL having the responsibilities of planning, design, construction and maintenance of roads in South Africa.

However, it became quite clear during the furore that surrounded the announcement of the development of the Gauteng Freeway Improvement Project (GFIP) that SANRAL had neither the competence or legal structure in place for e-tolling in place and that the development was “out of sync” with the necessary legal requirements for both the implementation of e-tolling and its enforcement of a user-pay system.

All of this followed the setting aside of an interim order that halted the GFIP and implementation of e-tolling by the Constitutional Court in September 2012.

The Transport Laws Bill specifically allows for SANRAL to operate a road network that makes use of “intelligent transport systems” therefore giving SANRAL authority to exercise e-tolling; in effect a response to the constitutional decision.

The Bill will also provide more enforcement powers to ensure that motorists pay e-tolls and since SANRAL is responsible for any strategic planning for South Africa’s roads, such which allow the process on a national basis.

In their recent annual report, the department of transport shows that only 5% of South African roads involve tolling but as minister Ben Martins explained to Parliament, this is a critical area of South Africa’s economic pulse and this particular portion of South Africa’s road network is mainly responsible for South Africa’s economic future.

The bill was previously published for comment in March 2010. The memorandum contained in the Bill clearly states that such legal background is necessary for any future road infrastructure development and states unambiguously that the funding of the GFIP is to come from the e-tolls raised from motorists.

On the issue of future funding, the memorandum departs from usual legal parlance and states. “The non-collection of tolls may impact negatively on the ability of the other State-Owned- Enterprises to raise capital for their infrastructure programmes and thus the need for the Bill must also be seen in the context of Government’s plans to fund its envisaged infrastructure programme”.

An inter-ministerial committee and COSATU, the latter objecting to the Bill, have met to discuss their differences.

Posted in Finance, economic, Labour, Public utilities, Trade & Industry, Transport0 Comments

E-tolling becomes a financial mess

With the department of transport gazetting draft regulations for public comment dealing with exemptions from toll fees on Gauteng toll roads, the recent Gauteng regional court decision to put tolling on hold has caused a legal and financial  implosion of considerable complexity.

 Written comment was invited until 9 May, 2012, the Gauteng Freeway Improvement Project having expected to be started on 30 April. The cancellation of the process sets an unfortunate precedent for e-tolling on highways around the country.

The gazetted notices were published in terms of the South African National Roads Agency Limited (SANRAL) and National Roads Act of 1998, together with a notice making known the places at which tolls can be paid.

On exemptions, commuter vehicle concerns were addressed inasmuch that taxis and buses, together with emergency vehicles, were exempted from paying toll fees. Exempted vehicles are to be issued with an e-tag for identification purposes when they pass through the tolling gantries.

The notices explain how non-registered e-tag users and non-registered vehicle licence number users are to make payment. SANRAL is to have mobile pay stations located alongside the toll roads to enable motorists to make payments.

Meanwhile Jeremy Cronin, deputy minister of transport, addressed the National Assembly a few days before the Gauteng regional court decision, answering criticism from opposition members parliamentarians.

He had said earlier in Pretoria that e-tolling in Gauteng was the only viable way to pay for the R20 billion spent on improving the province’s freeways. Opposition MPs were requesting rather to implement a small fuel levy to cover the cost of the SANRAL 20bn project.

Ian Ollis, shadow MP for transport, had complained it would cost over R1bn a year just to collect the fees and described it as “the world’s most expensive toll collection system”. He noted that the R20bn was being spent on a highway project that only involved about 180km of road.

Cronin agreed that “the particular tolling option that had gone forward was very expensive” but added that any national  levy, such as the one proposed on fuel, would be unfair to people living in other parts of the country who would be paying as a result for infrastructure in Gauteng.

Cronin acknowledged that there was “great unhappiness” over the introduction of e-tolling and any further spending on the project had ” been put on hold”, he said, adding that paying off the project debt by increasing the fuel levy was not an option.

Opening the debate in the National Assembly, Transport Minister Sibusiso Ndebele said South Africa had a responsibility to service the debt incurred when the project to improve the road network in the province was implemented.

“It is now public knowledge that South Africa has a financial obligation of R20bn to this effect, escalating to R32-billion with interest over the next couple of years.”Failure to honour this obligation will adversely affect our country’s credit rating.”

Minister Ndebele said he was “encouraged” by the fact that, to date, a total of 501 245 e-tags had been sold. At the time he was responding to the national budget where department of transport, received an overall R39-billion budget allocation for this financial year, which will rise to R48-billion by 2014/15. About R18bn of this is earmarked for roads.

Returning to the point raised by Cronin that all spending was on hold, earlier in the week the ANC had issued its own statement on the matter welcoming the delay the implementation of the e-tolling system by a month indicating that they too were in doubt about the system.

In a separate statement the DA’s Jack Bloom commented that in his view “the best thing for the government to do was to forget about e-tolling and move on to another funding method”, noting that damages would have to be paid in cancelling any contract but he repeated his colleague’s point that this might be cheaper than carrying on with a toll collection system that was as expensive as the road being built.

Quite clearly the next move will have to come from the minister of transport or, perhaps, even President Zuma himself or his deputy. An appeal against the regional court’s decision is reported to be a lengthy process.


Posted in Cabinet,Presidential, Finance, economic, Justice, constitutional, Public utilities, Trade & Industry, Transport, Uncategorized0 Comments

Taxi and Bus Exemption from E-Tolls: Cabinet confirms

Cabinet has reconfirmed that taxis and buses will not have to pay toll fees on Gauteng’s roads. In a statement released after the latest cabinet meeting, government emphasised that this decision was taken in the interests of the poor.

The Gauteng Freeway Improvement Project is set to come on stream on 30 April 2012. The poor are the main users of taxis and buses, the statement says, and added, “These transport modes will pass through the gantries free of charge”.

Reference was also made in the statement to the recent capital injection of R5.8bn announced by the finance minister, Pravin Gordhan, on Budget day. The money was made available, the statement says, “to help ease the burden on road users in Gauteng.”  The additional finance will also help government to reduce the tariffs for e-tags.

Light motor vehicles will now pay 30c per km; motorcycles 20c per km; non-articulated trucks 75c per km, whilst articulated trucks will pay R1.51 per km. The maximum amount that road users can be charged per month is to be capped at R550. The statement stressed that the credit card-linked e-toll account was not the only payment option available. Road users can also opt for the pre-paid e-toll account.

Posted in Energy, Labour, Public utilities, Trade & Industry, Transport0 Comments

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