Opinionista Ian Ollis 23 May 2013

The truth Sanral does not want you to know

Sanral’s social-wage-needs argument for e-tolling is shameless refusal to acknowledge that the need for funding to help eliminate the country’s road maintenance backlog is the direct result of a decades-long failure, by government and the South African National Roads Agency Limited, to adequately invest in such maintenance. Government must also shoulder the blame for the inefficient and ineffective use of available funds. The only way out of this mess is a road maintenance fund sourced primarily from the fuel levy.

In the latest instalment of reasons to legitimise the need for additional tolling and e-tolling on South Africa’s roads, the South African National Roads Agency Limited (Sanral) has referred to the increase in the social wage needs of South Africa as to why extra funds for road infrastructure and maintenance are required and why the argument for a dedicated fuel levy is insufficient.

This follows previous advertising campaigns in major newspapers citing two “simple reasons” why a fuel levy would prove ineffective. Sanral’s basic argument refers to cars becoming more fuel efficient, traveling further on less fuel, rendering the fuel levy ineffective to provide the necessary funding.

Effectively, Sanral does not have the money required to pay for our road maintenance and upgrade. With the extended outcry against the open road Tolling and the Transport Laws and Related Matters Amendment Bill (e-Toll Bill), the Sunday Times reported on 21 April (“Billions lost through toll roads delay”) that Sanral is losing at least R200 million a month through the delay in the Gauteng e-tolls implementation. E-tolling was to be implemented in June 2011, which means Sanral has lost almost R5 billion.

Clearly Sanral is eager to make its money back.

Sanral wastes no time in reminding the public of the apparent R150 billion roads infrastructure and maintenance backlog and the need for e-tolling as a consequence; but fails to adequately address the question of how a ring-fenced portion of the fuel levy could address the imbalance.

Sanral has argued that a fuel levy to fund road infrastructure and maintenance is insufficient, and that e-tolling is therefore necessary. However, two independent studies confirm that the fuel levy provides enough funding for the construction and maintenance of our roads and that there is no need for the wholesale construction of toll roads.

Equally important to how the country needs to fund our road projects going forward, has to be to look at how available funding has been utilised in the past.

Two independent studies, by the Automobile Association of South Africa (AA) and the Southern African Bitumen Association (Sabita), confirm that Sanral is misleading the public with regards to available funding.

The AA study, conducted in 2008, reveals that abolishing the dedicated fuel levy in 1988 resulted in significantly less spending on road infrastructure and maintenance which, in turn, resulted in the deterioration of the quality of our roads. It shows that an ideal maintenance budget for roads should have totalled R32 billion in 2008.

The Sabita study indicates that government only spent an average of R7.4 billion a year on road construction and maintenance between 2003 and 2008. The 2013 Budget Review indicates income from the fuel levy for the same period averaged more than R21 billion. What must be asked is why the nearly R14 billion on average, was not spend on road maintenance in the first place.

This same question must be asked this year. The fuel levy is estimated to bring in R41.7 billion in the 2013/14 financial year. From the graph, compiled from information in the reports and the budget review, it is evident that the bulk of fuel levy funds between 2003 and 2008 have been used elsewhere and not for road maintenance projects.

A similar trend occurred in the previous decade.

It is therefore clear that both government and Sanral are guilty of consistent underinvestment to the detriment of every South African, as we are all reliant on a functioning and well maintained road network for personal travel, work commutes, and the transport of essential goods such as fresh produce.

On top of the apparent underinvestment, government can also be blamed for the inefficient and ineffective use of available funding. An increasing social wage does exist. However, bailout upon bailout of major state-owned enterprises such as SAA and SA Express; expensive public infrastructure investment such as the Gautrain; as well as the ever increasing public expenditure on private homes, excessive cars, houses, credit card bills, car hire, luxury hotel stays and a general disregard for wasteful expenditure by government is depleting the available fiscus at a much more dramatic rate.

There is a need for funding to help eliminate the country’s road maintenance backlog but the DA has constantly opposed the wholesale erection of toll roads as the solution. A dedicated, road maintenance fund – sourced primarily from the fuel levy – would ensure regular supply of funds to address the road maintenance backlog and eliminate the need for excessive tolls to fund road maintenance.

Sanral and the government cannot expect South Africans to pay yet again for their inefficient and ineffective use of available funding. They must stop misleading the public and be honest about the resources that are available to them. DM