Explainer: Why e-tolls aren't working and should be scrapped

Explainer: Why e-tolls aren't working and should be scrapped

- E-tolls remain a thorn in the sides of many South Africans

- During his mid-term budget speech on Wednesday, the finance minister said it was about time e-toll defaulters start paying up

- However, Tshwane mayor, Solly Msimanga, disagrees and pointed out why e-tolls don't work and why it should be scrapped entirely

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Outa, the Organisation for Undoing Tax Abuse, in recent weeks called on motorists to ditch their e-toll payments in an effort to rally against Sanral’s calls to punish those who aren't paying.

On Wednesday, the new Finance Minister, Tito Mboweni, said during his Mid-Term budget speech that the time has come for drivers to be totally compliant with the system:

Mboweni said if South Africa wants a road transport infrastructure that works, motorists need to pay their e-tolls. He added that government is still committed to the user pay principle. Mboweni said it's "the most efficient and effective way to ensure that the direct benefits of services are paid for by those who use them.”

But the DA doen't agree.

Tshwane mayor, Solly Msimanga, went after Sanral after conducting an oversight visit at a local e-toll facility. Msimanga said the system was bad for business.

He said the president should rather announce that e-tolls will be scrapped and that other plans will be made to fund Gauteng roads.

"Sanral is now issuing summonses for non-payment of e-tolls to overburdened companies and motorists. This has a negative impact on businesses that are surviving during this recession.”

Msimanga said e-tolls are an excessive and unnecessary burden on Gauteng motorists. The mayor claims motorists are struggling to pay e-tolls, because of rising living costs due to inflation increases, as well as the increase in the fuel price.

Furthermore, Msimanga said tolls also have an effect on groceries that pass through the province, which then affects the rest of South Africa too.

Msimanga highlighted statistics during Wednesday's budget speech too.

Msimanga broke the e-toll statistics into 6 points:

1. Just 7% of all funds raised via e-tolls go back into Gauteng’s road infrastructure.

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2. Motorists are believed to owe Sanral R11 billion. It's estimated about 70% of motorists refuse to pay the tolls.

3. In the 2016/17 financial year, it was found that irregular expenditure of R10 billion was racked up by Sanral. The South African also reported that taxpayer money was also wasted. R15m was believed to be wasted expenditure.

4. Sanral was expected to collect R3bn, but there's been a shortfall of R2.1 billion this year. By the end of this year, it's expected that Sanral will only collect R900 million.

READ ALSO: Tito Mboweni wants to cut cabinet: 70 ministers and deputies make no sense

5. Sanral recovered just R10.2 million through legal processes in the last two years. However, court action has cost the state owned entity more than R4 million. This made Sanral's R6 million profit look piddly compared to its shortfalls in turnover and earnings projections.

6. Sanral would have to issue R2.2 million court orders to force every toll-defaulter to make payment. In the last 24 months, only 15 505 court orders were issued.

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Source: Briefly.co.za

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