The only fair and sensible approach to e-tolls on the Gauteng Freeway Improvement Project (GFIP) is to immediately suspend e-tolling in Gauteng and reimburse consumers who have paid e-tolls since 2013, says the Automobile Association.
This, the association says, has flowed from research in its recently released Road Funding Report, adding that a ring-fenced e-toll levy linked to the general fuel levy is the only equitable and viable means of funding the GFIP.
“Our research indicates people will not pay under the current conditions. It also shows that debt is not a factor in people’s decisions. Most users are not paying because of a principled position taken years ago and no amount of cajoling or enticement will change their minds,” the AA says.
Transport minister Fikile Mbalula said earlier this month that he is seeking a “win-win” solution for government and society to the GFIP e-toll saga, which suggests that e-toll defaulters will possibly not be let off the hook even if electronic tolling on this freeway network is scrapped.
Speaking on the sidelines of the Southern African Transport Conference, Mbalula asked: “How do we meet each other halfway in this” and how does government manage and deal with all the challenges it is facing?
President Cyril Ramaphosa has appointed Mbalula to head a task team that must report to him on the options on the table with regard to e-tolls. Mbalula said there would be a comprehensive response from this task team by the end of August.
The AA says e-toll compliance remains low and is dropping because of a number of factors, including the confusion resulting from different messages from provincial and national government and the announcement in March this year that historic debt will not be pursued.
‘Fraction still pay’
“In this environment, compliance rates are expected to significantly taper off further, leaving only a fraction who still pay,” the AA says.
The association stresses that despite claims to the contrary, the ring-fencing can be accommodated on a provincial basis, instead of nationally, to ensure that only residents of Gauteng who benefit from the GFIP are taxed in this manner.
Despite objections to this ring-fencing, it remains the easiest, most equitable and least administratively difficult tax to collect, it says. “Ring-fencing alleviates many of the problems currently experienced and will immediately have an impact on the funding of the GFIP. Given the huge resistance to e-tolls in Gauteng, finding a workable and sustainable solution should be everyone’s goal.”
The AA says users who have paid tolls to date should be reimbursed to ensure equity going forward, adding that this is also critical to achieving consensus among motorists that the ring-fencing model is fair.
“We stress, however, that the ring-fencing model is intended to deal directly with the funding of GFIP going forward, and does not deal with the issue of the approximately R90-billion debt racked up so far by this appalling system, which is cumbersome and antiquated,” it says.
Wayne Duvenage, chief executive of the Organisation Undoing Tax Abuse (Outa), stressed this month that e-tolls could not be resurrected and indicated that Outa is willing to assist government in finding legitimate solutions to end the e-tolls impasse.
The organisation’s proposal to settle the e-toll debt includes renegotiating the debt with the Public Investment Corporation; terminating the collections contract with Electronic Toll Collections (ETC) because this is a massive and unnecessary cost; and reassessing the budget to include allocations by national treasury towards the debt, including a possible allocation from the fuel levy.
- This article was originally published on Moneyweb and is used here with permission
