File picture: David Ritchie/African News Agency (ANA) Archives

Johannesburg - The Organisation Undoing Tax Abuse (Outa) is worried that the R7 billion loan granted to the SA National Roads Agency Limited (Sanral) will sink the state-owned entity further into debt.

The New Development Bank (NDB), which was established by BRICS countries (Brazil, Russia, India, China and South Africa), announced on Monday that it had granted Sanral a R7 billion loan to improve key national roads which will eventually lead to reducing transportation costs.

According to the NDB, the scope of Sanral’s project includes rehabilitation of pavements for existing toll sections of national roads, construction of additional lanes and rehabilitation of infrastructures such as bridges and intersections.

But non-profit civil rights organisation Outa on Tuesday said the e-toll scheme has failed dismally to fund Sanral’s debt, which now stands at R47bn, and has resulted in a bailout from the National Treasury and reshuffling of its Department of Transport allocation.

”What is required is clarity around the extent and use of Treasury and other bond funding, and the allocation of these funds to manage Sanral’s debt and finance specific road projects,” said Outa chief executive Wayne Duvenage.

He said the South African public requires transparency on why this loan is needed.

The NDB has stated that the loan is guaranteed by the South African government and it has been reported that it still awaits approval by Transport Minister Fikile Mbalula and his finance counterpart Tito Mboweni.

Sanral spokesperson Vusi Mona has not responded to Independent Media’s queries.

In July, The Sunday Independent reported that the government may have to pay billions of rands if it goes ahead with plans to scrap the unpopular e-tolling system.

Treasury warned that the termination of e-tolls will force the state to pay R11.1bn in unguaranteed debt while it will also be responsible for R19bn in guaranteed debt.

Political Bureau