Johannesburg - The Gauteng Freeway Improvement Project cost R11 billion more than it should have to construct 185km of road, overpriced by 321 percent when compared to other road construction projects around the world.
These figures were distributed by the Organisation Undoing Tax Abuse on Monday when it announced the new, broader direction the organisation was taking.
E-toll hike to inflict 'pain' on Gauteng
Previously, Outa was known as the Opposition to Urban Tolling Alliance, but chairman Wayne Duvenage explained it was now focusing on broader civil activism issues.
At the relaunch, Outa released a research and position paper on the construction costs of the GFIP, comparing the cost of the project to 11 road construction projects from other countries.
Duvenage said: “There are a number of international benchmark case studies from which Sanral can glean a good understanding of where they rank in the space of road construction costs, and if they did so, as we have done in our research, they will find that the prices they are paying for road construction in South Africa, if the GFIP is anything to go by, is grossly overstated.”
The GFIP was found to cost R96.7 million per kilometre of road built. This was compared to projects such as the Idaho Department of Transport, which cost the equivalent of R37.4 million per kilometre, and the Trans-Kalahari project in Namibia which cost R9.5 million per kilometre.
OVERCHARGED
It was found that the GFIP was overpriced by an average of 321 percent when compared to other projects around the world, Outa said in its report.
The organisation said Sanral paid roughly R11 billion of the R17.9 billion more than it should have. Duvenage said the public had been grossly overcharged for the upgrade and this had serious implications when one looked at the e-toll project.
He said Outa believed the GFIP should not have cost more than R7 billion, and at that price, the cost of servicing the bonds would not have been more than R1 billion a year.
The collection fee for e-tolls alone came to more than R1billion a year, Duvenage added, making e-tolls a completely irrational decision.
“This research and position paper tells us there is something grossly wrong with the cost of road construction on Sanral’s watch,” said Duvenage.
AUDITED
Sanral spokesman Vusi Mona said the company was not in a position to respond until it had studied Outa’s report.
“We would need to be sure that the report was compiled by a credible institution or person where the facts are supported and the figures audited,” he said.
Outa also spoke about other big-spend projects it would be taking a closer look at.
Duvenage said they now had offices and a number of professionals working there specialising in research and investigation, lobbying the public and litigation with in-house advocates fighting abuse of taxes on behalf of the public. They were also working on a facility which would protect and assist whistle-blowers.
“Sanral and government would love for us to go away. We have exposed their irrationality. We have questioned their integrity. But we have stayed the course, and in so doing, have bvcome stronger,” Duvenage said.
He said Outa was also challenging the electricity tariff increase; looking at nuclear energy as well as the waste recycling of tyres, where R50 million is being made every month (R10 million of which is going to consultants) and the carbon tax.