OUTA defends interdict appeal and challenges e-toll collection costs

OUTA filed its answering affidavit for Treasury’s leave to appeal the e-toll interdict, in the Constitutional Court today.

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04/06/2012 10:37:57

OUTA defends interdict appeal and challenges e-toll collection costs

In its papers, the Opposition to Urban Tolling Alliance (OUTA) makes reference to a number of pertinent points in the case, some of these being:

  1. As of today, SANRAL are still not ready to launch e-tolls, given the outstanding regulatory issues e.g finalisation of the exemption criteria and SANRAL regulations. In addition the e-Toll enforcement procedures and how these relate to AARTO and the Criminal Procedures Act remain unclear. It is also noted that just last week, on 31 May, the Minister of Transport withdrew the e-toll Tariffs for further review.

  2. In the process of preparing OUTA’s responding affidavit, we obtained a copy of the ETC JV agreement with SANRAL (which includes Austrian Kapsch Trafficcom AB being the major shareholder), from court papers in another matter. From the contract, we now see that the cost of the five year tender is R8,3bn (or R1,6bn / annum). Taken over 20 years, this means that the cost of collection is in fact R33,4bn, therefore R13,4bn more than what is assumed in the founding affidavit filed by the Minister of Finance and SANRAL. This means the road users will pay much more for toll collection than the road upgrade.

  3. The Deputy Minister, Jeremy Cronin, in a speech made on Workers Day (1 May 2012) launched an attack on SANRAL and accused them of misleading the Minister of Transport, regarding important aspects along with a number of mistakes made with regard to e-tolling in Gauteng. This is the government criticising its own agency and acknowledging the mistakes made, however, it still insists on the continuation of e-tolling as its favoured funding mechanism for GFIP.

  4. The claim by the Minister of Finance that the interdict is causing the country irreparable harm (Clause 8.9 of Treasury’s founding affidavit) is refuted by OUTA. In the Minister’s own affidavit, he conveniently overlooks not only the four postponements before OUTA’s application, but also the further fact that the Minister of Transport himself announced a postponement of e-tolling on the late afternoon during argument in court and before the interdict had been handed down. This in the face of strenuous argument in court against the postponement of e-tolling’s effect on the economy, made by counsel for Treasury and SANRAL that very day.

  5. Furthermore, the decision by Government itself to delay the implementation of e-tolling on numerous occasions has had a direct bearing on the Moody’s rating of SANRAL’s bonds in advance of OUTA lodging any legal action.

  6. In the founding affidavit of Treasury’s appeal, OUTA have been accused of delaying the review process, however, the records from Departments of Transport and Environmental Affairs were only received last week on the 1 June, some one and a half months late. It is notable that SANRAL’s own record was also issued late.

  7. Much has been made of late concerning SANRAL’s financial position and that Government finances are being placed under severe pressure as a result of this interdict. OUTA claims this to be untrue as the debt of SANRAL is very small in the context of the national debt and is easily provided for in the contingency reserve and economists of the like of Christ Hart and Azar Jamine have provided significant input to this effect.

  8. Despite the recent comments by the Treasury Director General, Mr Lungisa Fuzile that the collection costs would by 2017 only account for 20% of revenue collected, OUTA believes that the DG has not offered any detail to support the assumption and persists with its assertion that the e-toll model will carry unreasonable costs and an administrative burden for all. OUTA has yet to be convinced that the collection costs will be less than R20 billion over twenty years and in all likelihood, could be much higher, particularly in the absence of any clear enforcement procedures which will add undue pressure to the current strained judicial process.

OUTA firmly believes that the current legal focus by Treasury on the appeal to the Constitutional Court is misplaced as the priority should rather be to expedite the full review proceedings. OUTA have now been invited to meet with the Vice President and head of the inter-ministerial committee, where we will table our points and suggestions aimed at resolving the current funding impasse, in order that South African road users can enjoy upgraded national highways funded through an efficient mechanism which e-tolling does not offer.

Duvenage encourages South Africans “to review OUTA’s full responding affidavit and Treasury’s affidavit on their website and continue to make contributions towards the ongoing legal expenses.”


Picture: Flickr/Paul Saad

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