Are e-tolls funding corruption, Outa asks

Are e-tolls funding corruption, Outa asks

Transport Minister Fikile Mbalula has admitted that a date for a decision on the e-toll scheme is still undetermined and that a funding solution must be found.

Mbalula was responding to questions in Parliament.

“We believe the continued operation of the Gauteng e-tolls, which only around 15% of motorists are contributing toward, has little to do with the search for a new funding mechanism, but more to do with where some of the current R50 million or so each month is actually going,” says Wayne Duvenage, CEO of the Organisation Undoing Tax Abuse (Outa).

Outa believes the only alternative to e-tolls is for the Gauteng Freeway Improvement Project (GFIP) bonds to be financed via National Treasury. To date (between 2016 and 2020), Treasury has already allocated Sanral R10.8 billion for GFIP (ie, around 51% of the freeway bonds for the overpriced upgrade), which is on top of another annual grant of R70bn (an annual average of R14bn per annum) for the same period for non-tolled roads. This has been the solution being practised for the past number of years and should remain, as the entire country benefits from Gauteng’s freeway upgrade.

“Furthermore, it is important to note that Sanral itself has written off R23.6bn of the unpaid e-toll bills, of which R17.3bn was revenue not recognised and R6.3bn (of the R10.4bn that was reflected in the books) was impaired as uncollectable. Thus, the failure to collect e-tolls in lieu of payment for the GFIP bonds is a fait accompli,” says Duvenage.

“The question one must ask is why then does Sanral continue to operate the defunct scheme, when only a handful (mainly a few businesses who profit out of e-toll charges to the clients) continue to pay? This has never been an efficient or enforceable user-pays scheme, which is the mantra that people in government cling to when responding to the failed scheme.

“We believe that corruption, or the allocation of funds to areas where these should not be going, probably has something to do with the state’s reluctance to pull the plug on the scheme.”

Outa bases its contention on the following: Read more here 

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