There’s a tricky legal battle brewing over the collection of e-tolls because, according to Organisation Undoing Tax Abuse (Outa), Sanral had a legal obligation to halt its contract with the Electronic Toll Collections (ETC) company on Wednesday (December 2).
“That’s when the contract came to an end and it cannot be extended again after the two single-year extensions since December 2018. This means that Sanral should in law be unable to collect e-tolls until a legal fight over the tender process for a new contract is finalised,” says Advocate Stefanie Fick, Outa executive director.
“The initial five-year e-toll collection contract with ETC came to an end on December 2, 2018. However, due to the demise of the system and Sanral’s state of confusion over its future, the ETC contract was extended twice by a year each to December 2019 and again to December 2020.”
She points out that Sanral is bound by public finance legislation that prevents it from continuous extensions to limited-period contracts with outsourced service providers. “As Sanral has now reached the end of its e-toll collections agreement and has not appointed another service provider through a formal tender process, if the law is to be strictly applied, the state-owned entity's service providers may not bill motorists for e-tolls from today (December 3).”
Sanral issued two tenders for a new collections contract, she adds, one in August 2019, which it subsequently cancelled, and another in July 2020. “The tenders were to seek a new contractor for the Gauteng open road tolling system, including the transaction clearing house and violations processing centre. However, a recent court challenge over the tender process has halted the announcement of a new service provider.”
“Even if the judge makes a ruling on Sanral’s latest e-toll collection tender debacle this week, there is the formality of appointing a new service provider and a long hand-over period with the current operator, which is surely not possible within a few days,” says Outa CEO Wayne Duvenage.
In a further complication, Gauteng motorists and Sanral are still waiting for a long-promised Cabinet decision on the future of e-tolls.
In July 2019, President Ramaphosa instructed Transport Minister Fikile Mbalula, Finance Minister Tito Mboweni and Gauteng Premier David Makhura to resolve the e-toll impasse so Cabinet could make a decision on funding the Gauteng freeways, but no decision has ever been announced. “This makes the awarding of a new e-tolls collection contract financially risky,” says Duvenage.