Mineral Resources and Energy minister Gwede Mantashe has warned that South Africa’s petrol price will increase if the government scraps the controversial e-toll system.
Speaking to News24 on the sidelines of a conference in Nigeria, Mantashe said that scrapping the scheme would likely result in South Africans making up the shortfall through increased fuel levies.
While Mantashe acknowledged South Africa’s record high petrol price was an extra burden for already stretched consumers, he said his hands were tied, and government could not intervene.
“There’s nothing we can do unless we change the formula; it goes up, it goes down,” he said.
E-tolls have been met with resistance from road users since inception in 2013, leading to non-payment by many and calls to scrap the system altogether.
President Cyril Ramamphosa, Transport minister Fikile Mbalula and the Gauteng provincial government have all acknowledged the system’s failings and have pledged to address the issues.
Announcement in February
Finance minister Enoch Godogwana will announce the future of e-tolls in his February 2022 budget, says transport minister Fikile Mbalula.
Mbalula said that a decision on the controversial tolling scheme had been delayed due to an inability to finalise consultations between his department, Treasury, and Cabinet.
He explained that there would be a financial cost involved irrespective of what decision the government takes on e-tolls – including whether to scrap or keep the scheme.
Mbalula pointed to recent discussions with the government’s creditors, who have made it clear that e-tolls will need to pay for in some form. Whether e-tolls are kept in place or scrapped, they need to be paid for all the same, and a decision has to be taken, he said.
Civil society group Outa has argued that scrapping the e-toll scheme will be the cheapest option, as none of the current e-toll funds are being allocated to the freeway bonds and there are no penalties if the scheme is cancelled.
Outa said the state has already been funding the GFIP bonds through Treasury’s tax allocations,
It said that the National Treasury has already increased the fuel levy well above the suggested amount of 10c per litre of petrol since 2008, which means the funds already exist within Treasury’s coffers to make allocations to Sanral to pay for the GFIP bonds, as it has been doing for the past six years.