There is confusion over the exact amount the Gauteng Provincial Government will have to pay to settle its 30% share of the debt to the South African National Roads Agency (Sanral) under the Gauteng Freeway Improvement Project (GFIP) electronic tolling scheme, following an agreement reached with the National Treasury.
Depending on which information you rely on, the amount could be either 12.9 billion rand or 14 billion rand.
Read: Government hands ‘hot potato’ of e-toll to Gauteng government
Sanral CFO Inge Mulder told Moneyweb that Sanral’s total debt under the GFIP loan is about 43 billion rand.
She said that in terms of the Medium Term Budget Policy Statement (MTBPS), the national government will pay 70% of Sanral’s GFIP debt, which is 30.1 billion rand.
Mulder said the 23 billion rand allocated under Sanral’s MTBPS therefore reduces the national government’s share to about 7 billion rand.
This is a reference to the 23.7 billion rand committed by Sanral to the MTBPS to repay the government-guaranteed debt, subject to a solution being found for Phase 1 of the GFIP.
Mulder said the Gauteng government would still need to contribute R12.9 billion.
However, Gauteng’s new premier Panyasa Lesufi said in response to the MTBPS report that the provincial government will work closely with National Treasury to ensure revenue streams are found to pay off some of Gauteng’s e-toll debt of “14 billion rand” .
Read:
The discrepancy appears to be related to whether the agreement between Treasury and the Gauteng government is based on Sanral’s total debt of 47 billion rand or only on the GFIP debt.
Finance Minister Enoch Godongwana said last week that Sanral’s GFIP debt was 47 billion rand.
Sanral’s 2021/2022 integrated report says the roads agency has a borrowing limit of R47.91 billion by March 31, 2022.
Sanral’s 30% debt is 14 billion rand.
Debt escalation
Leaving aside the amounts owed by Sanral, it is not clear how Sanral’s GFIP debt rose to 43 billion rand.
Undoing Tax Abuse (Outa) CEO Wayne Davenage questioned why the Gauteng government should pay 30% of Sanral’s total debt and not just the GFIP debt.
“I don’t see Gauteng province contributing to other Sanral bonds that they could have issued for non-Gauteng projects,” said Duvenage.
“It’s very confusing and we need clarity and transparency on this issue and how much of the GFIP bond repayments have been settled…According to Sanral’s statements, they borrowed 21 billion rand, of which 17.9 billion rand was for construction roads,” he added.
“It was a much inflated price, which was proven through [contactor] conspiracy and the other was for the infrastructure – the toll infrastructure, the offices, the transaction clearing house and the infringement processing center in Samrand, and the portals and everything else,” he said.
questions
Duvenage said Sanral had received 22.4 billion rand from the National Treasury since 2012, plus 230 million rand a year from the Gauteng provincial government since the e-tolling system was established, and questioned how much of that had been used to repay GFIP bonds and pay percent. .
It is also unclear where the Gauteng provincial government will get the funds to repay its portion of the Sanral GFIP debt, as well as cover the cost of maintaining the 201km GFIP and associated interchanges, as well as additional road investment.
Gadongwana suggested that these points would be funded either through the existing electronic toll infrastructure, new toll points or any other source of revenue within the Gauteng Provincial Government’s area of responsibility.
Lesufi expressed relief that “e-tolls matter”, but his further comments suggest that e-tolls will be scrapped.
“We believe this is an important victory as it brings great relief to the people of Gauteng who have had to bear the burden of paying electronic tolls on national roads,” he said.
“There will be further engagements with Sanral regarding the repurposing of the e-tolling infrastructure, which we believe can be useful in the provincial government’s anti-crime strategy.”
Lesufi added that the Gauteng government is convening an urgent meeting with the Minister of Finance to finalize some of the terms of the Gauteng provincial government’s commitments.
Read: Government plans to use fuel levy instead of e-tolls to pay for GFIP
However, he has no good news for motorists who pay electronic tolls.
“The issue of people who are already paying for e-tolls is a matter for Sanral,” he said.
Outa’s Duvenage said the e-payment system would not be used to pay e-tolls, but the infrastructure would be used to generate other revenue for the Gauteng government.
Mulder said that under specific instructions from National Treasury, it was understood that Sanral would use payments from the national and Gauteng governments to repay all the bonds it had taken out to pay for the GFIP.
Maturity dates for the remaining GFIP bonds range from Feb. 11, 2022, to July 31, 2035, she said.
“It is important to note that the bonds are not linked to the GFIP as they are part of the toll road portfolio, which consists of 1,681 km of toll roads funded by Sanral. Therefore, the borrowing portfolio will be maintained to ensure the sustainable financing of all remaining toll roads.
“At this stage, Sanral does not have enough information on when and how the funds will be distributed to make a decision to buy back the bonds early,” she said.
GFIP’s 201 km road network is only 1% of the national road network operated by Sanral.
The Open Road Tolling tender, worth 6.872 billion rand, which expired, was one of five tenders worth 17.4 billion rand that Sanral canceled in May due to irregularities in the tender process.
Read:
Sanral revises target to award ‘cancelled tenders’ by R17 billion
25 million potholes on SA roads
Will Sanral receive any bids for the open road toll collection tender in Gauteng?
Subsequently, all five tenders were re-announced and are currently in the decision stage.
Mulder confirmed that the tender process for the open road toll is at a very advanced stage, but noted that it would be inappropriate to comment on the number of bids received or name bidders as the procurement process is still ongoing.
She added that Sanral will only be able to comment on what will happen to this tender now that Sanral no longer has anything to do with GFIP and the e-payment scheme following engagement with National Treasury, the Department of Transport and Gauteng Province. .
