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Chapman's Peak drive in Cape Town. Picture: Matthew Jordaan

Why did the provincial government decide to toll Chapman’s Peak?

The former Cape Metropolitan Council was sued for negligence after Noel Graham was paralysed when a rock fell on his car on Chapman’s Peak drive in 1994. He was awarded R4 million in damages in November 2000. After the devastating fire in January 2000, which loosened rocks, a motorist was killed by a rockfall.

Premier Gerald Morkel closed the road in January 2000. It appears the authorities feared further litigation.

Construction company Concor then put in an unsolicited bid to fix up the road as a toll road. Soon afterwards, the provincial government gazetted its intention to toll Chapman’s Peak Drive. Ben Veldman, then a senior roads department official, who appeared to drive the move to toll the road, said at the time a completely private toll “would not be financially viable” and that public money would have to be used as well. The projected cost was R350m. In 2001 the then MEC for Transport, Tasneem Essop, declared the 9km road a toll road. The Western Cape is the only province that runs a toll road and legislation had to be created to enable it to do so.

What was the public reaction?

There was a public outcry. Residents balked at having to pay to use the road, which at today’s prices amounts to R62 for a return trip of about 18km.

They also were appalled at the proposal to build two big toll plazas, one near Hout Bay and one near Noordhoek, on one of the most spectacular coastal roads in the world which has iconic status for many. A third issue was the extremely high cost of the road, a significant amount of which was to come from public coffers.

The public was allowed to comment on the proposal to toll, but it went ahead despite the outcry.

Were there alternatives?

Geoff Tinker of Martin & East engineering company put forward a low-cost alternative at the time. After conducting several inspections, Tinker found that the road could be repaired for between R25m and R30m, a fraction of the R350m cost of the toll road. A proactive management system would be introduced with periodic inspections of the rock faces and the road closed for limited periods if considered necessary, as is done on similar roads in the US and Europe. His proposal was rejected.

Was the Martin & East proposal feasible?

Tinker said the public perception since the 2000 court case was that Chapman’s Peak Drive was extremely dangerous. However, despite the accidents, the road met international safety standards. Many other Western Cape roads carried the risk of rockfalls, and Boyes Drive, Victoria Road and the N1 in Du Toits Kloof had all been closed because of rockfalls. The Gordon’s Bay-Rooi Els road had permanent signs warning motorists of rockfalls.

He said few people had bothered to read the Noel Graham judgment, in which the court said there were no measures to avoid rockfalls completely, nor were the authorities expected to exercise “prophetic foresight”.

They were, however, required to apply their minds to the safety of the roads, particularly after heavy rains or rockfalls.

The authorities had closed Chappies in these conditions several times in the past. The court found the authorities negligent in the Graham case because they had failed to apply their minds in this case, and had left the road open in dangerous conditions with no adequate warning signs.

Martin & East’s proposal recognised there was no fail-safe method to prevent falling rocks – including the catch nets and tunnels in the Concor proposal – but said its proposal to repair the road, coupled with proactive management afterwards, would make it less risky than several other similar roads in the Western Cape. The R350m toll option made no sense and was a waste of money, said Tinker.

So why did the provincial government go for the R350m option?

It was done soon after the government’s public-private partnership legislation came into effect, and some say the provincial government wanted this to be the “prototype” case. Others say the provincial government was running scared after the court judgment, which it would not have done had it read it properly. Some believe it was a case of naive officials and politicians, befuddled by Concor’s slick presentations and proposals, and that there is a tendency for governments to opt for the big, hi-tech options, just because they are big and hi-tech. There were also questions raised about some of the BEE players in the Entilini consortium, who had strong ANC connections. The provincial government was ANC-run at the time.

Which companies made up the Entilini consortium?

Concor Holdings (55 percent), Haw & Inglis (15 percent) and Marib Holdings (10 percent). Thebe Investments (20 percent) later pulled out. Marib’s directors included Lionel Louw, chief of staff for former Western Cape premier Ebrahim Rasool, Brian Figaji and Patrick Parring. Essop signed a 30-year concession agreement in May 2003 with Capstone 252 Pty Ltd, which later became Entilini.

Murray and Roberts later bought out Concor.

What were the problems with the agreement?

It was heavily slanted in favour of the concessionaire and onerous on the province. The contract was based on projected traffic figures, which Concor’s consultants, Stewart and Scott Pty Ltd, had worked out. They had projected, month by month, the number of vehicles they believed would use the toll over the next 30 years. These traffic figures were crucial, as they were used for the financial basis of the contract. The contract said if the money collected from the toll fees did not match the amount of money they expected to get each month – based on their projected traffic figures – the province must pay them the shortfall. The problem was that the projected traffic figures were highly inflated, so the public, through the province, was forking out millions to compensate the company for traffic that did not exist.

In addition, Entilini could close the road when it wanted to, for any length of time. The public, through the province, had to pay the company compensation when the road was closed, based on the same inflated traffic figures. So the public paid to use the road and they paid not to use the road.

These faulty figures were used as the justification for building the proposed toll plaza and double-storey office building.

The company has not released recent figures, but those up to 2008 show that its projected figures from 2004 to 2008 were around 6.5 million, yet the actual figures were 3.3 million. From December 2003 to February 2009, the province paid Entilini R57m in compensation.

Local residents have been battling for years to get traffic figures for the entire period to date, but Entilini has refused to release them.

The public believes it is because they will show that the gap has widened even more, and that the financial base of the contract was built on a myth.

What did the province do about the contract?

When Lynne Brown was premier, she appointed a task team to look into the contract. It found no evidence of impropriety in the management of the toll road. However, Brown admitted the province had “made mistakes” in the contract and that it had to wise up in managing public-private partnerships. Getting out of the deal was not an option as terminating it would cost it R180m.

Is that contract still in place?

Yes, but sections have been renegotiated by Transport MEC Robin Carlisle. Now only the province can close the road, not the company, and it may decide not to build the Noordhoek toll plaza. Also, payments by the province to the company are related to actual operating costs, not to projected traffic figures.

On the downside, the free day-passes for people using picnic and hiking sites will be scrapped once the toll plaza has been built.

What was the environmental impact assessment about?

It was about building the toll plazas in an environmentally-sensitive area. The former Department of Environment Affairs and Tourism gave the toll plazas the go-ahead in 2005, but the public took the matter to then Environment Minister Marthinus van Schalkwyk on appeal. In 2008 he upheld the department’s decision, and gave the green light. With hindsight, the public say they should have taken his decision to court on review, because Van Schalkwyk approved the toll plaza being built on Table Mountain National Park land. Lawyers say this would be a good ground for review, as his act was unlawful.

He would have had to ask Parliament to expropriate it first. However, there is only a short period when an administrative decision can be taken on review, and that has expired. But in the Oudekraal case, the court heard the matter 40 years after the decision, so a precedent has been set.

Why is SANParks giving the land away?

Sanparks head David Mabunda told the Cape Times the land was a road cutting and had “no significant biodiversity value” so could be carved off for the development. He said the toll office was “in the public interest given the well-known problem of land shortage in Cape Town”.

If the decision was made years ago, why is there an outcry now, with 2 000 people in a protest march last week?

The public says two things were never made clear: they were not told that the toll office was to be built on national park land, nor were they given the detailed plans of the office.

The Hout Bay Residents’ Association came by this information by chance in recent months. It was astounded by the size of the luxury office block, with a large number of offices, kitchens, showers, meeting rooms and sliding doors onto terraces. It believed it was unnecessary, and would set a bad precedent by giving away national park land for use that has nothing to do with its mandate. The public will have to pay R25m of the R54m the office and toll plaza will cost.

Once the toll agreement has ended in 2033, the provincial government will own the building. However, the toll contract can be extended. Residents believe the luxury office was a “sweetener” to Murray & Roberts for renegotiating a more favourable agreement with the province, when it was not legally bound to do so. Carlisle has denied this.

What now?

Lawyers appointed by the residents wrote to Sanparks and the provincial government months ago to say it is unlawful to build on national parks land. They wrote back to say they were taking legal advice.

On Thursday Carlisle gave the order for construction to begin “in the road reserve”. Unless the residents can raise R150 000 to take the matter to court, the toll plaza and office will soon be a permanent feature in the national park.

melanie.gosling@inl.co.za - Cape Times