Peters' arithmetic skills questioned

The minister of transport, Dipuo Peters, seems to be overestimating just how much would have to be added to the fuel levy if it replaced e-tolling as the means of raising the cash to cover the Gauteng freeway improvement project (GFIP). This after she presented the department’s viewpoint to the advisory panel of the e-tolls review hearings recently. The levy for the 2014/15 financial year amounted to R2.25 per litre of petrol and R2.10 for diesel. It is not easy to see just how Peters came by the R3.65/litre levy that the GFIP would require, according to Garth Bolton, joint MD of the road transport major, Cargo Carriers. “That figure’s ridiculous,” he said. “And she only seems to be using it to make e-tolling look good.” The calculation that the union body, Cosatu, came up with sounds a lot more like the truth. Using the fuel levy to fund Gauteng’s highways would need an additional 14c a litre on the fuel levy to meet the funding needed by the SA National Roads Agency Limited (Sanral), said Cosatu’s Gauteng provincial secretary, Dumisani Dakile. This was calculated from SA having used 22.5 billion litres of fuel in the 2013-14 financial year, according to the annual report of the SA Petroleum Industry Association (Sapia). This 14c on the fuel levy would raise an extra R3.15bn of revenue a year, according to FTW’s calculation. And, if the Opposition to Urban Tolling Alliance (Outa) is correct, and the first phase of the Gauteng freeway improvement project (GFIP) was completed at a cost of approximately R21bn, this could be repaid within seven years. But the e-toll opposition group, Justice Project SA (JPSA), said the figures the DoT had come up with were not based on the cost of the Gauteng project alone. During the department’s presentation, acting director-general Mawethu Vilana argued that it would require R65.8bn a year just to cover the on-going maintenance to the road network. This, he reckoned, would require an additional levy of R1/litre – bringing the fuel levy up to R3.17 per litre. To cover the road works that are not part of what he called the “sustain allocation” above, would need a further R0.48/l or an overall fuel levy of R3.65 per litre. JPSA chairman Howard Dembovsky, was quoted as saying this was “outrageous”. “They are talking about funding everything – the entire country’s roads infrastructure, not just the GFIP – from the fuel levy, and nothing from the fiscus. That’s how they get those figures.” Now, according to the National Treasury 2013 budget review, the fuel levies for the six financial years, 2007/08 to 2012/13, amounted to R188.8 billion, or R31.47bn a year. The opposition to e-tolling argues that road construction and maintenance could be adequately funded using this existing national fuel levy system. But the problem they also highlighted is that these monies are no longer ring-fenced for road maintenance and building needs, but are mostly gobbled up by the general fiscus, with about a third of the money shared with metropolitan municipalities. INSERT R3.65 Minister Dipuo Peters' estimated levy per litre required to pay for GFIP.