The final word on e-tolls

 ·5 Mar 2024

Gauteng MEC for finance Jacob Mamabolo says that the province has approached financial institutions to borrow the necessary money needed to pay off the e-toll debt – while taking on over R4 billion worth of maintenance backlogs.

Presenting the Gauteng budget on Tuesday (5 March), Mamabolo reiterated the promise from the province’s premier Panyaza Lesufi that the controversial tolling scheme would be shut down from 31 March 2024.

Gauteng is on the hook for 30% of the debt owed on the e-toll project, amounting to almost R13 billion. The balance of 70% will be paid by National Treasury. It has been a long-standing question where the Gauteng portion would come from.

“The province has approached financial institutions to raise the money required to honour its contractual obligations,” Mamabolo said.

“This demonstrates beyond any reasonable doubt that the province’s commitment to comply with national treasury requirements and bring us closer to exiting the Gauteng Freeway Improvement Project is right here,” he said.

“Come the 31st, come the new financial year, e-tolls will be things of the past.”

He said that the process will see National Treasury and the Department of Transport and road agency SANRAL move forward with the de-linking of the toll system and repealing the necessary legislation to end the scheme entirely.

Two weeks after the deregulation gazette, Gauteng road users will no longer be charged to use the province’s freeways, Mamaboo said.

“Various processes will be in place leading up to the date, including turning the tag beeps off and stopping invoices to road users.”

Echoing statements from transport minister Sindisiwe Chikunga, while the gantries will be switched off for e-tolling, they will remain operational for other uses, such as crime prevention. E-tags will also continue to function and will be usable at other e-toll-activated tollbooths.

In terms of the rest of the budget, the province’s transport department has been allocated R9.4 billion for 2024 and 2025, and R28.1 billion over the MTEF.

The provincial government is also on the hook for R4.1 billion in road maintenance backlogs, which it said it is allowed to pay over four years starting in 2025.

“We have held engagements with SANRAL, and they confirmed the e-tolls maintenance backlog of R4.1 billion and the fact that funding will be required over a period of four years.”

When questioned on the logic behind borrowing money to pay off debt, Mamabolo said that this is a case of paying for tangible assets that are already underpinning the economy.

“We’ll borrow to pay. The contribution that the minister has directed us to make is for the roads that have been built. When you look at the roads that are carrying this country’s economy…we are paying for an asset that’s already there. These are functional assets.”

E-toll bills

While the tabling of the budget appears to put a final word on e-tolling in Gauteng, questions still remain around recent comments from National Treasury on outstanding e-toll debt.

Deputy director-general of public finance at National Treasury, Mampho Modise told Moneyweb in February that the government would be coming after unpaid e-tolls.

“Gauteng has agreed that around R6 billion in e-toll debt should and will be collected,” she said, referring specifically to the e-toll debt owed by motorists.

This was not raised or directly addressed by Mamabolo in his speech.

E-toll critics like civil action group Outa said that trying to go after historic debt would be futile, since Sanral has not issued summons over bills since 2019, meaning most of the debt as prescribed.

However, it said that if the government does go after unpaid e-toll bills, this will be challenged in court.

Questions also remain how exactly the Gauteng government will pay off the money it is lending to cover the e-toll debt.

Opposition parties like the DA are already flagging the trouble with lending money to pay off the debt, noting that loans draw interest, “and the Gauteng Provincial Government (GPG) would have to find a way to raise additional money to repay the initial loan and the interest it will attract”.

So even if e-tolls are done, the system “will continue to put a financial strain on the residents of this province,” the party said.

Read: Transport minister tries to clear up e-toll confusion

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