Gauteng’s R20 billion e-toll problem – and you have to pay for it
Although the government has officially terminated e-tolls, the Gauteng government still faces an outstanding e-toll debt of R20 billion, and motorists are still required to pay any outstanding amounts.
Following more than a decade of significant public backlash, the government officially switched off the gantries of the Gauteng Freeway Improvement Project (GFIP)—popularly known as e-tolls—on 11 April 2024.
Despite this termination, the Gauteng government is still left with R20 billion of debt.
Gauteng MEC for Finance and Economic Development, Lebogang Maile, announced that the first instalment of R3.8 billion towards this debt was paid on 30 September.
“The Gauteng Provincial Government is starting the process to service the historical debt of R12.9 billion in five equal annual instalments at a government 5-year interest rate.
“The first instalment that we are paying…amounts to R3.8 billion, consisting of R3.2 billion historical debt and the maintenance portion of R546 million,” he said.
Maile said the province will need to allocate a substantial amount of funds each year for the next five years to meet the repayment obligations.
“As a result, we are working with revenue-collecting departments to identify alternative sources of revenue to ensure that frontline services remain uncompromised while safeguarding essential social services for vulnerable members of society and maintaining the provision of basic services in the province.”
Motorists have been warned that they are still expected to pay their outstanding e-toll debts.
According to OUTA CEO, Wayne Duvenage, who spoke on Newzroom Afrika, Gauteng shouldn’t have to pay this debt in the first place.
The big question, Duvenage explained, is how the debt got to R20 billion.
It was originally around R12 billion for Gauteng’s contribution to the freeway improvement projects, with another R4 billion for road maintenance.
However, the government cannot explain “where this money and where this debt is coming from”.
“Our belief and view are that the provincial management right up to Panyaza Lesufi has just really got it wrong and shouldn’t have entered into this debt in the first place.”
“Gauteng never had to settle any of this debt because it wasn’t their roads, it wasn’t their decision, and I don’t know how a province pays for assets or maintenance of assets that it does not own.”
However, Gauteng is now trying to pay off this debt even though they “are almost broke as a province”.
He said the consequences of taking on this debt will be severe for the people living in the province.
In 2023, the province witnessed cuts to social services, resulting in many NGOs losing funding, while hospitals are still suffering due to poor management and a lack of funds.
“You and I, the public, will suffer as a result of this,” Duvenage said.
The province mentioned plans to raise revenue, but no details have yet been presented. For example, even though lots of money has already been invested into the Beyers Naudé extension project, it has been stalled for over a year.
“So, we just get a sense that we have a province that is not managing its financial affairs properly, and we will suffer,” Duvenage said.
“Anybody suffers in any country or city or Province where your management wastes its funds, and that’s precisely what’s happening here. Something has to give.”
Road funding
Duvenage explained that road funding in South Africa faces significant challenges that extend beyond the issue of e-tolls.
It is a concern at national, provincial, and local levels. Local governments rely on taxes to maintain the roads we use daily, but in cities like Johannesburg, over 25% of bridges are deemed unsafe, highlighting a serious problem.
Road funding comes from a few sources.
The fuel levy, which raises around R90 billion a year, is distributed by the treasury to provinces and Sanral (South African National Roads Agency).
Sanral also gets R12 billion to 15 billion annually for road maintenance, plus R3 billion to R4 billion from toll projects.
However, a significant issue lies in the lack of transparency regarding toll revenues from long-distance concessions. As Duvenage pointed out, “We’ve been asking this question for some time, and there’s a gross lack of transparency.”
Road financing should involve a combination of fuel levies, existing tolls, and taxes collected at both local and national levels. Unfortunately, the current allocation and expenditure of these funds are inadequate.
“What we find is that in South Africa, we spend between three and four times the amount we should on every kilometre of road.”
This is a result of contracts being awarded to companies that are not equipped to handle the projects, inflated costs, and excessive middlemen.
If managed properly, we could potentially build three kilometres of road for the price of one, he said.
For instance, the GFIP was initially projected to cost between R6 million and R7 million per kilometre based on Sanral’s estimates, but the total expenditure reached R18 billion for a 186-kilometer upgrade, which included the addition of only one lane.
Generally, road upgrades should average R8 million to R9 million per kilometre, but South Africa is paying much more due to poor management and oversight.
This mismanagement is evident in other projects as well, such as the Lilian Ngoyi Street site in Johannesburg, where work stalled and contractors who were paid upfront vanished without completing the job.
All of these issues point to a systemic problem in leadership and management across various levels of government, Duvenage said.
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