Toll price shock on the cards for Cape Town

Cape Town residents could face toll fees as high as triple those in Gauteng should a tender awarded by Sanral go ahead. This is according to the city’s mayoral committee member for transport, Brett Herron.

The revelations come after the Supreme Court of Appeal ruled in favour of the City of Cape Town regarding publicly disclosing the tolling tender, allowing it to disclose details about the N1 and N2 Toll Highway Project awarded to Protea Parkways Consortium (PPC).

Parts of the information Sanral wished to keep secret included:

  • Should the tolling of the N1 and N2 freeways go ahead, residents from the Western Cape and visitors to this region will pay toll tariffs that are nearly three times that of the e-toll tariffs that are being charged by the new Gauteng Freeway Improvement Project.
  • PPC’s anticipated toll revenue over the concession period (2010 values, excl. VAT) is in the region of R48 billion.
  • The decision to declare the Winelands toll roads was taken by Mr Nazir Alli, Chief Executive Officer of Sanral, and not by the Sanral Board, as is required by the Sanral Act.
  • Sanral failed to disclose the consequences of the reimbursement clause in its Concession Contract with PPC to the Sanral Board and the Transport Minister. The contract addresses the risk that the Minister may determine lower toll tariffs than the Concessionaire is entitled to charge under the Concession Contract, or may refuse or delay approving a change in the toll tariffs.

If the Minister of Transport were to determine lower toll tariffs than PPC is entitled to under the concession contract, Sanral would have to reimburse them the difference, Herron explained.

“In terms of this clause, Sanral would have to divert public funds meant for the construction and maintenance of national roads to fund PPC’s profit expectation of R48 billion.”

Importantly, the Gauteng Freeway Improvement Project charges a toll tariff of 30c/km for light vehicles, while PPC’s proposed base toll tariff for light vehicles is 84.59c/km (VAT included, 2013 values).

“PPC’s rate, therefore, would require a 65% reduction in order to be equivalent to the GFIP rates.”

There were a number of other differences as well:

  • The GFIP toll tariffs for light vehicles are capped at R450 per month; PPC’s discount scheme does not make provision for any cap.
  • PPC, unlike the GFIP, does not make provision for specific time-of-day discounts.
  • The GFIP effectively allows for a 100% reduction for public transport while PPC only allows for a 50% reduction for public transport.

This article was republished with permission from MyBroadband

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Toll price shock on the cards for Cape Town