‘Tolls are not the only option’

Government may consider tolling to be one of the most effective ways to maintain roads, but South Africans across the board are up in arms over what they say are unreasonable and inconsiderate toll fees from the South African National Roads Agency Limited (Sanral). In fact, the furore that erupted following Sanral’s announcement of the toll tariffs for the Gauteng Freeway Improvement Project (GFIP) led Government back to the drawing boards, with the entire process having been suspended by the Minister of Transport, Sibusiso Ndebele. “We have withdrawn the gazette on the proposed tariffs to allow for more thorough consultation,” said Ndebele, who has also appointed a task team to review the entire financial model on which some R20 billion was borrowed to upgrade the freeways in Gauteng. FTW asked several experts for their opinions on tolling and the impact on the economy. “If tolls are necessary, the necessity has to be proven by the agency responsible for the road,” said Johan Kruger of Solidarity. “The figures have to be open to the public and independent scrutiny. Although it is not very popular in South Africa, the idea of ring-fencing certain parts of government revenue for certain purposes needs to be explored. The need for road maintenance is a given – it cannot be wished away while spending existing fuel levy money on other things.” The union says that shifting more freight to rail could drastically reduce ongoing road maintenance costs. According to Gavin Kelly of the Road Freight Association (RFA), tolling is not necessarily the only means available to keep roads upgraded and maintained. “We pay a fuel levy for every litre of fuel and those in the know estimate it to be in the region of R32 billion a year. Why not ring-fence it to pay for the maintenance of roads like it should be? Even a small increase of a few cents on the petrol price could be used for road maintenance and would cause less economic damage than the toll fees are expected to do.” The GFIP toll structure, set to be implemented later this year, will see light vehicles paying 66 cents a kilometre, while heavy duty vehicles will have to fork out R3.96 per kilometre before discounts are applied. “Any increase in the cost of transporting freight will result in higher delivery costs and these fees will ultimately be passed on to the end user,” said Dave Logan of the South African Association of Freight Forwarders (Saaff). “Toll systems are used across the world to finance this kind of infrastructure that we are seeing in and around Gauteng, so in principle it is an acceptable form of financing road infrastructure. The burning question, however, has to be what happens to the fuel levy that all road users pay currently?” Kelly maintains the tolls will have a huge impact on the economy, not just of the province but the country. In some cases it is estimated goods will increase by up to 25%, as some freight will be tolled several times as it traverses the province. “It is going to have a devastating impact – and yes, that is a harsh word to use – but it’s going to drive the basic transport logistics costs up, impact on the profitability of companies, and while in some companies it will be recouped, in others it won’t, which will ultimately lead to some companies closing down.” Said Kruger: “Gauteng contributes roughly a third of south Africa’s total GDP. A great deal of the country’s economy is linked to the province. Cost increases in Gauteng will impact on businesses across the country.” But with tolls having just been increased across the country and plans for more tolls in the Western Cape and other major roads in Gauteng on the cards, it would seem tolling is here to stay. “The way in which the toll system and especially the toll tariffs were announced was not nearly transparent enough,” said Kruger. “The take it or leave it approach that seems to have developed is worrying.” According to Kelly there seems to be no evidence to show that an economic impact assessment was done prior to the announcement of the toll fees. “One would presume taking into account the money they were borrowing – R20 billion – there would be a number of options available to pay back the loan. I don’t believe there has been enough information available to explain to the public why 66 cents per kilometre is a better way of paying back the loan than for instance increasing the petrol price by 5 cents a litre. There has been no transparent process as to how they arrived at these costs.” Logan said the announcement certainly came across as high-handed with a take-it-or-leave-it attitude. “In recent years it seems that no consideration has been given to the availability of realistic alternative routes – people either have to use the toll roads or stay at home,” said Kruger. “This renders the argument on the benefit of the toll roads moot, because regardless of whether the toll road’s benefits outweigh the costs, road users have no choice but to opt into the system.” Sanral was asked for comment but by the time of going to print none had been received.