Picture: Michel Bega
Confusion exists over the exact amount the Gauteng provincial government will have to pay to settle its 30% portion of the South African National Roads Agency (Sanral) debt on the Gauteng Freeway Improvement Project (GFIP) e-toll scheme following the agreement it reached with National Treasury.
Depending on what information you rely on, the amount could be R12.9 billion or R14 billion.
Sanral chief financial officer Inge Mulder told Moneyweb that Sanral’s total GFIP loan debt is about R43 billion.
She said in terms of the Medium-Term Budget Policy Statement (MTBPS) announcement, national government would pay 70% of Sanral’s GFIP debt, which is R30.1 billion.
Mulder said the R23 billion allocated in the MTBPS to Sanral therefore reduces the national government’s portion to about R7 billion.
This is a reference to the R23.7 billion allocated to Sanral in the MTBPS to pay off government-guaranteed debt on condition that a solution is found for Phase 1 of the GFIP.
Mulder said the Gauteng government would then still need to contribute R12.9 billion.
However, new Gauteng Premier Panyaza Lesufi said in response to the MTBPS announcement that the provincial government will work closely with National Treasury to ensure that revenue streams are found to settle Gauteng’s portion of the e-tolls debt “amounting to R14 billion”.
It appears this discrepancy relates to whether the agreement between Treasury and the Gauteng government is based on Sanral’s total debt of R47 billion or only its GFIP debt.
Minister of Finance Enoch Godongwana said last week that Sanral’s GFIP debt was R47 billion.
Sanral’s 2021/22 integrated report said the roads agency has a borrowing limit of R47.91 billion up to 31 March 2022.
A 30% portion of Sanral’s debt amounts to R14 billion.
Disregarding the Sanral debt amounts, it is unclear how Sanral’s GFIP debt escalated to R43 billion.
Organisation Undoing Tax Abuse (Outa) CEO Wayne Duvenage questioned why the Gauteng government should have to pay 30% of Sanral’s total debt instead of only the GFIP debt.
“I can’t see Gauteng province contributing towards Sanral’s other bonds that they might have taken out for projects that are not Gauteng-related,” said Duvenage.
“It’s very confusing and we need clarity and transparency about this and also how much of the GFIP bonds were settled … According to Sanral’s statements, they borrowed R21 billion, of which R17.9 billion was for the road construction,” he added.
“This was well overpriced, which was proven through the [contactor] collusion, and the other was for the infrastructure – the tolling infrastructure, the offices, the Transaction Clearing House and Violations Processing Centre in Samrand and the gantries and all of that,” he said.
Duvenage said Sanral has received R22.4 billion from National Treasury since 2012 plus R230 million a year from the Gauteng provincial government since the inception of the e-tolls scheme and questioned how much of this had been used to pay back GFIP bonds and settle interest.
It is also unclear where the Gauteng provincial government will get the funds to pay off its portion of Sanral’s GFIP debt and also cover the costs of maintaining the 201km of the GFIP and associated interchanges plus any additional investment in roads.
Godongwana suggested these items will be funded through either the existing electronic toll infrastructure or new toll plazas, or any other revenue source within the Gauteng provincial government’s area of responsibility.
Lesufi expressed relief at the finalisation of “the e-tolls matter” but his further comments suggested 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 brunt of paying e-tolls for roads which serve a national purpose,” he said.
“There will be further engagements with Sanral regarding the repurposing of the e-tolls infrastructure, which we believe can be of use in the crime fighting strategy of the provincial government.”
Lesufi added that the Gauteng government will convene an urgent meeting with the minister of finance to finalise some of the modalities relating to the Gauteng provincial government’s obligations.
However, he did not have any good news for motorists who have been paying their e-tolls.
“The matter of people who have already been paying for e-tolls is in the purview of Sanral,” he said.
Outa’s Duvenage said the e-toll system will not be used for e-tolls but the infrastructure will be used to raise other revenue for the Gauteng government.
Mulder said that, subject to specific guidance by National Treasury, the understanding is that Sanral will use the payments by national government and the Gauteng government to pay off all the bonds it took out to pay for the GFIP.
She said the maturity dates of the remaining GFIP bonds range from 11 February 2022 to 31 July 2035.
“It is important to note that bonds are not ringfenced to GFIP, as they are part of the toll portfolio, consisting of 1 681km of toll roads funded by Sanral. Therefore, the borrowing portfolio will be maintained to ensure the sustainable funding of all other toll roads.
“At this stage, Sanral does not have sufficient information regarding when or how the funds will be allocated to be able to make a decision to buy back bonds earlier,” she said.
The 201km GFIP road network comprises only 1% of the national road network managed by Sanral.
The Open Road Tolling tender valued at R6.872 billion, which had lapsed, was among the five tenders worth R17.4 billion Sanral cancelled in May due to irregularities in the tender process.
ALSO READ: E-tolls: The people have spoken
All five tenders were subsequently readvertised and are currently under adjudication.
Mulder confirmed the Open Road Tolling tender process is at a very advanced stage but indicated that it would be inappropriate to comment on how many bids were received or to name the bidders as the procurement process is still underway.
She added that Sanral will only be able to comment on what will happen to this tender now that Sanral will no longer have any future involvement with the GFIP and e-toll scheme after it has engaged with National Treasury, the Department of Transport and Gauteng Province.
This article originally appeared on Moneyweb and was republished with permission.
Read the original article here.
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