Cash-strapped Sanral a red herring?
The Opposition To Urban Tolling Alliance (Outa) has questioned claims made by the South African National Roads Agency (Sanral) that it is strapped for cash as a possible red herring to try and garner society’s sympathy and support for its e-tolling system.
Sanral said on Wednesday (24 July) that investors are reluctant to provide more funding as it runs out of cash after delays to the project, Bloomberg reported.
“Sanral has almost totally depleted its available cash,” Vusi Mona, general manager of communications for the Pretoria-based state-owned company said in an e-mailed response to questions by the media house.
“We’re not able to fund ourselves any further, due to investors not feeling comfortable with our risk profile.”
Outa responds
In response to reports in the media related to Sanral’s shortage of funds, Outa said it is of the opinion that Sanral has only itself to blame for this predicament they find themselves in.
The group said that, besides a six month period when e-tolling was interdicted between 29 April and mid-September 2012, Sanral has been free to launch its plan.
Outa said that Sanral proclaimed in the Constitutional Court in August 2012, that it could and would start e-tolling within weeks of the interdict being set aside.
“Ten months have now passed since that ruling in their favour and one has to ask why they have not launched as quickly as they said they would,” said Wayne Duvenage, chairperson of Outa.
“We are of the opinion that the system, the biggest of its kind in the world, is too complicated to implement in this environment and enforcement is a huge problem for them,” said Duvenage.
Outa argues that Sanral is a state-owned entity and, with the backing of government, it should not be allowed to put its work on hold because of its own mismanagement. “We don’t see SAA’s flights grounded due to their mismanagement do we?” Duvenage questioned.
“We are also surprised to read in the report of their funding shortage having a possible impact on maintenance of existing toll roads. What is happening to the funds collected from users along these routes, which are supposed to be used to maintain them?” he questioned.
Government and Sanral
The opposition lead said that he simply cannot see government allowing Sanral to fail. “Its function is too important to allow that to happen and we trust this is not a red herring to try and garner society’s sympathy and support for e-tolling.”
Outa pointed out that had government applied a 10 cent increase to the fuel levy in 2006 to fund the GFIP (when the e-toll road project was hatched), the country would have raised over R17 billion to date, which would have covered the capital costs of the freeway.
Sanral borrowed 20 billion rand ($2.1 billion) to fund the Gauteng Freeway Improvement Project.
It has debt, including interest, of R65 billion and R1.48 billion of bonds which reach maturity at the end of October, according to data compiled by Bloomberg.
A matter for the court
In April 2012, the High Court in Pretoria granted Outa an interdict approving a full judicial review before electronic tolling could be implemented.
The interdict prevented Sanral from levying or collecting e-tolls pending the outcome of the review. Sanral and the National Treasury appealed the court order.
In September, the Constitutional Court set aside the interim order, and in December, the High Court in Pretoria dismissed Outa’s application to scrap e-tolling.
The court granted Outa leave on 25 January 2013 to take the matter to the Supreme Court of Appeal in Bloemfontein.
The appeal is expected to be heard on September 25 and 26.
More on Sanral and Outa
E-toll “propaganda” costing Sanral millions: DA
Sanral: e-toll revenue taxed before going offshore
DA to fund Outa e-toll legal fees
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