Johannesburg - The City of Joburg has delivered a damning assessment of the e-tolling system in its submission to the Gauteng premier’s advisory panel.
The Saturday Star can exclusively reveal that the council has not only broken ranks to reject e-tolling as inappropriate, but also delivered what could be a major blow to its future. The advisory panel was set up to assess the socio economic impact of the controversial scheme.
The city has suggested the e-tolls will diminish the emerging middle class – the cornerstone of future growth – and dampen their impact on the economic growth of the city.
On Friday, Business Unity SA (Busa) told the panel that the government had ignored a recommendation of the presidential review committee on state-owned entities that said funding for social infrastructure, including roads, should be less reliant on the “user pays” principle.
The Joburg council said that Sanral had not sufficiently considered how e-tolling was changing the income profile of Gauteng residents and the emergence of what it called the aspirant new middle class – 40 percent of whom lived in Soweto and worked in the northern suburbs.
“The city has identified this group as the cornerstone of future growth and any additional tax on this group will likely dampen the impact that they can make on the economic growth of the city,” the council said. “Already the aspirant middle class generate approximately R17 billion in Joburg.”
In respect of who should pay for the present and future Gauteng Freeway Improvement Project infrastructure and maintenance, the council said: “It should not be the road user.”
“It should be the national fiscus which should be replenished through normal tax instruments that will not be a thorn to the road users and the public,” read its submission to the panel.
The city said one of the initial reasons it was not supportive of the e-toll system was the impact on its road network due to traffic diverting from freeways. The council said it had been agreed that one year after the introduction of the system an impact investigation should be done.
The city said proposals that were agreed upon in 2007 as part of the toll scheme integration process between municipalities, Sanral and the Department of Transport were not implemented.
These included a R10 billion upfront investment in the public transport system in Gauteng, physical cordoning off of all new right lanes on the freeway network for exclusive use by public transport and high vehicle occupancy lanes.
Kgatlaki Ngoasheng, executive director of economic policy at Busa, told the panel on Friday that the unprecedented rise in the cost of doing business would have consequences for investment, inflation and ultimately economic growth.
Ngoasheng said e-tolling was not only problematic, with as much as double the average of other tolling systems in SA and abroad, but it contradicted the National Development Plan growth aspirations.
“One study concluded that we’ll need in excess of R70 billion extra if we pursue the e-tolling system,” said Ngo-asheng. “The e-tolling system is toxic for small business growth and delivery of goods.”
He said while Busa acknowledged the necessity to pay for road improvements and extension in general, the current method of payment was inefficient and expensive. He added that a ring-fenced fuel levy would be more efficient and would require only 10 cents increase to the current levy to recoup the money to help Sanral pay its debt.
He rejected Sanral’s submission to the panel that 82% of road users registered were paying less than R100 a month, accusing Sanral of lack of consistency and transparency.