New finance minister expected to pronounce on e-tolls in his mini budget

Finance Minister Enoch Godongwana is expected to pronounce on the controversial e-tolls scheme on the Gauteng Freeway Improvement Project (GFIP) when he delivers his mid-term budget policy statement (MTBPS) on November 4.

This is according to a tweet by Transport Minister Fikile Mbalula titled “Decision On E-tolls Remains Pending”, with a copy of an earlier statement issued by Mbalula on the future of e-tolls.

Mbalula said in the tweet: “I have noted statements to the effect that I suggested that e-tolls cannot be scrapped. Such statements are at best mischievous and at worst malicious.”

Moneyweb reported on Wednesday that a final decision on the future of e-tolls on the GFIP has not been taken by the government despite reported comments by Mbalula late last week that the system cannot be scrapped.

The Citizen reported on Friday, in ‘E-tolls must stay, insists Mbalula‘ that the minister had reiterated that national roads must be maintained and that this costs money, which means the e-toll system cannot be scrapped.

Eyewitness News, in ‘Mbalula’s decision to keep e-tolls draws widespread criticism‘, reported that Mbalula had announced that an e-toll funding solution would be found, but the gantries were here to stay.

Confusion

Moneyweb’s article said Mbalula’s reported comments had caused some confusion, with some people interpreting them as being the government’s long-awaited final decision on the future of the controversial scheme but that cabinet spokesperson Phumla Williams had confirmed that a final decision on the matter has definitely not yet been made.

Attempts to obtain comment from Mbalula’s spokesperson Lawrence Venkile on Thursday were unsuccessful.

Mbalula said in the statement that it is common cause that the Organisation Undoing Tax Abuse (Outa) and the Gauteng government, among others, are opposed to e-tolls.

“We have taken into consideration their concerns as part of the process aimed at finding a sustainable solution. Over the last few months, we have been emphatic that the matter of e-tolls is a matter that Cabinet is seized with.”

Work is ‘underway ‘

Mbalula said: “Work that will inform the final decision of Cabinet is currently underway. This includes work being undertaken with the Minister of Finance. Cabinet is determined to resolve the matter in the best interests of the country and its economic standing. Government will therefore make the necessary pronouncements once a decision has been made.

“Government is giving careful consideration to various options, as these all have financial implications to be taken into account.

“We are determined to bring this matter to finality before the end of the year,” said Mbalula.

“We expect that the Minister of Finance, when he delivers the Medium-Term Budget Policy Statement in November 2021, will pronounce on the e-tolls. By that time, we believe Cabinet would have finalised the matter,” he said.

Pressure and perspective

Sanral CEO Skhumbuzo Macozoma last month called on the government to “bite the bullet” and take a decision on the e-toll scheme on the GFIP while Gauteng MEC for Public and Roads Infrastructure Jacob Mamabolo reiterated, in an interview with eNCA on Saturday, that the official position of the Gauteng provincial government on e-tolls remains that they must be scrapped.

Outa CEO Wayne Duvenage stressed this week there aren’t any additional costs to Sanral if e-tolls on the GFIP are scrapped because the e-toll management contract has expired.

However, Bloomberg reported in September that Godongwana had reportedly cautioned against forgiving road toll debt in a presentation delivered to an ANC meeting.

Bloomberg said Godongwana told the meeting the government, among other things, will need R4.6 billion to forgive unpaid highway tolls in central Gauteng and warned that this “request has serious long-term consequences if the user-pay principle is rejected”.

Mbalula has on a number of occasions over the past 18 months said a final decision on the future of e-tolls on the GFIP is imminent. During his budget vote speech in May, he said he had presented nine possible solutions to the e-tolls impasse and confirmed the first of these options was “to scrap the e-tolls”.

President Cyril Ramaphosa in 2019 appointed Mbalula to head a task team to report on the options available for the future of e-tolls by August 2019.