SANRAL’s fuel levy argument “beyond simplistic”

The Opposition to Urban Tolling Alliance (OUTA) has again noted SANRAL spokesman Mr Vusi Mona’s extraordinary incoherence in trying to justify e-tolling as a better source of revenue than a national fuel levy.

13/03/2014 11:50:20

SANRAL’s fuel levy argument “beyond simplistic”

Following SANRAL CEO Nazir Allis campaigning in Kwa-Zulu Natal last week Mr Mona turned up in Cape Town this week at a special media event in the Western Cape to try to rationalize SANRAL’s tolling ambitions in the province.

“Mr Mona’s arguments about the supposed “unfairness” of using the fuel levy fund for road construction reveals a great deal more than Mr Mona intended. He clearly does not understand fiscal budgeting and long term financial planning” says OUTA's chairman, Wayne Duvenage who added “In Mr Mona’s attempt to talk down the fuel levy as a funding mechanism for road infrastructure he was quoted as saying that about R42bn was collected (annually) by the Treasury from the fuel levy nationally. SANRAL receives an allocation from that. While that is indeed so, he then went on to say that ‘because the GFIP cost R20 Billion, it would be unfair to the rest of the country for 50% of fuel levy to be spent on Gauteng’. No-one has ever said or expects that the entire cost of the GFIP should be paid for in a single year. The loan amount needs only to be paid off over a twenty year period, which works out at R1.9bn per annum (including interest) which is less than 5% of the annual income from the fuel levy. Why has his boss not explained to Mr Mona that bonds for capital infrastructure development are not the same as borrowing money to pay for annual school fees.”

Furthermore, both Mr Mona and Mr Alli have said that revenue from designated fuel levies were now declining worldwide because of improved engine technology and fuel efficiency. “What extraordinary logic is that? While the quality of engine technology may be improving, the ever increasing quantity of motor vehicles using the roads continues to push the fuel levy yield up” says John Clarke, OUTA's spokesperson. “Moreover, in the past three years since the completion of the GFIP, Treasury has increased the fuel levy by 31% to R2.34 per litre, thereby accumulating another R12bn per annum into government coffers, enough to effectively finance five new Freeway Improvement Projects of R20 Billion each, without the need for added costs of e-toll collections. SANRAL is not helping to advance the policy debate by such ridiculous arguments. To call them ‘simplistic’ is too dignifying. They are just plain stupid.”

“The best that can be said of Mr Alli’s utterances in Durban last week and Mr Mona’s claims made in Cape Town this week is that SANRAL have helped do what OUTA was planning to do anyway – alert KwaZulu Natal and Western Cape residents to the national implications of the Gauteng e-tolling."

OUTA recently received information from a reliable confidential source close to the system that has confirmed speculation that SANRAL’s ambition was always to extend e-tolling throughout the country. “We have learned that the Midrand Central Operations Centre was planned and built to cater for thousands of km’s of roads, not just the 187 km’s of the GFIP and now ranks as the second largest storage array in the Southern Hemisphere” says Clarke. “This completely contradicts Advocate Jeremy Gauntlett’s recent argument in the Cape High Court that ‘the type of e-tolling facilitated by the collection method envisaged by the amendment bill is, and remains, highly unusual. It is only appropriate in very confined circumstances’. Mr Alli has yet to explain the contradiction between what his counsel argued in court and the clear intention to take e-tolling way beyond the confines of Gauteng,” says Clarke.

OUTA is a proudly South African civil action organisation, that is purely crowd funded. Our work is supported by ordinary citizens who are passionate about holding government accountable and ensuring our taxes are used to the benefit of all South Africans.