Johannesburg - The Organisation Undoing Tax Abuse has reacted sharply to the latest round of mandatory tariff increases along all 'conventional' tolling routes.
Wayne Duvenage, chairman of the organisation (formerly the Opposition to Urban Tolling Alliance) said: “We’re disgusted that Sanral and the department of transport have this attitude that they can just go on applying mandatory annual tariff increases to all the toll plazas in the growing toll network, while there are serious questions about the income generated by tolling contracts and how it’s used.”
He pointed out some of the organisation’s major concerns and issues it was looking into:
Toll concessionaire contracts, such as those along the N3 and N4, and N1, can run for as long as 30 years, yet the cost of building a toll road is a fixed capital outlay - just like building a house. That means the effective bond repayments on the tolled road decrease each year thanks to inflation and the reduction of the outstanding amount.
Nevertheless, Duvenhage said, toll fees keep increasing each year for the entire 30 year period, regardless of whether the capital amount has already been repaid, and far beyond the cost of maintaining the road. This has made South Africa’s toll roads into enormous tax-driven cash cows - with guaranteed income for periods of up to 30 years - for the companies that operate them.
In addition, he said, some construction companies own large stakes in the companies that run the toll roads - which means that when there is construction or maintenance to be done on those roads they can award the contracts to themselves or their affiiliates at inflated prices - which the tolling concessionaires then use as justification for increasing the tolls.
Details of construction and maintenance contracts awarded are kept confidential by these companies with the excuse they are “private companies who do not have to disclose that information to the public”.
It’s already known that building roads in South Africa is much more expensive than in other countries. Duvenhage said the organisation would soon release the results of its research into just how expensive the road construction allowed by Sanral actually is, and where that money is going.
DOES ‘USER PAYS’ ACTUALLY APPLY?
A select few companies collect enormous revenues from administering the toll collection processes - but but are reluctant to give details about how much of that money is diverted into paying for the processes.
More than that, Sanral has abolished the legal requirement to provide and maintain alternative routes to tolled roads. Duvenhage said the organisation had received numerous complaints from communities along the alternative routes that these roads had been allowed to fall into disrepair, forcing motorists - especially commercial traffic - to use the toll roads whether they wanted to or not.
The whole ‘user pays’ tolling mechanism is questionable, says the organisation, because Sanal has also amended the legislation so that tolling revenue generated along one route no longer has to be used to maintain that particular road, but can be directed towards any of Sanral’s projects or maintenance operations.
PUBLIC ACCESS TO INFORMATION
Duvenhage pointed out that toll road concessionaires were, in effect, providing a service to the public on behalf of the state and were subject to strict laws, which the organisation would apply to lay out all the relevant information for public scrutiny.
But it would be in everybody’s interests he said, not to force Outa to pry the information out of Sanral through a long drawn-out Public Access to Information Act process - which would merely increase the frustration level of the public and raise further questions about the integrity of the parties involved.
Outa’s members had been moved, he added, by the increasing flow of information from the public - especially from people inside the organisations involved - that was helping it unpack and address the questionable conduct within these entities. He encourage the public to provide more information by making protected disclosures via the Outa website .