Sanral reissues e-tolls tender despite uncertainty

Roads agency Sanral has reissued the tender it cancelled in March for the continued management of e-tolls, despite the continuing uncertainty that exists over the future of e-tolls on the Gauteng Freeway Improvement Project (GFIP).

E-toll account payment compliance rates have now declined even further to below 19%.

Sanral engineering executive Louw Kannemeyer confirmed that Sanral reissued the tender on 17 July. The closing date is 16 September. The tender includes the operations and maintenance of a National Transaction Clearing House and Violations Processing Centre.

Kannemeyer said Sanral has not been informed of any decision by government on the future of e-tolls, stressing that such a decision will be communicated by cabinet.

The test case brought by the Organisation Undoing Tax Abuse (Outa) to review the legality of the e-toll system has been postponed “subject to a cabinet decision on the future of e-tolls”, he said.

Minister in the presidency Jackson Mthembu gave assurance in March that e-tolls would be discussed by cabinet, following a promise made in December 2019 that a decision on the future of e-tolls would be taken in the first cabinet meeting of 2020. The cabinet has already met a number of times this year. Mthembu did not comment at the time on why cabinet had not yet taken a decision.

‘A farce’

Outa CEO Wayne Duvenage said on Tuesday “it will be a farce and silly” if the main purpose of the reissued tender is to run the Gauteng e-toll system, particularly as e-tolls is a failed scheme and Outa does not believe it will be resurrected.

However, Duvenage said this tender is clearly for something more than e-tolls and incorporates integrated public transport and the transaction clearing house mechanism. He said this will take Sanral a bit beyond its scope of road building but there is no reason it shouldn’t provide additional services if it has technology that can do this.

The National Transaction Clearing House (NTCH) is currently almost exclusively used for clearing e-toll collections for various toll operators and toll plazas. However, Sanral previously confirmed it is in the process of repackaging and expanding the function of its NTCH to provide a host of other mobility services, such as vehicle licence renewal payments, cashless parking, fuel payments and to use Sanral’s customer service centres for driving licence renewals.

Outa’s Wayne Duvenage

Sanral CEO Skhumbuzo Macozoma recently reported that Sanral incurred a loss of more than R640 million during the Covid-19 lockdown.

Kannemeyer said last week that Sanral calculated this loss based on the difference between average income per day of week for the three months prior to lockdown compared with actual income per day during the various lockdown levels at all Sanral toll plazas countrywide.

He said this loss took into account the low payment compliance rate of e-toll accounts.

Kannemeyer said the average compliance rate for e-toll payments was about 19.58% in the three months before the Covid-19 lockdown. He revealed the subsequent e-toll payment compliance rates:

  • 19.78% in March
  • 22.96% in April
  • 19.54% in May
  • 18.63% in June
  • 18.45% in July

Sanral previously confirmed that the compliance rate for e-toll payments was at 21.33% in February 2020, compared with 22.75% in February 2019.

Kannemeyer said there was an average of 75 million transactions a month at all the e-toll gantries in the almost three months prior to the implementation of the Covid-19 lockdown on 27 March. He said traffic levels on the GFIP declined to 25% of the normal average during level 5 of the lockdown – increasing to 45-55% in level 4, 70% in level 3, and 80% to 85% of normal levels in level 2.

Sanral GM of communications Vusi Mona confirmed in March that the decision by Sanral’s board to cancel the original tender for the continued management of e-tolls was informed by a review of the assurance documents from Sanral’s legal and internal audit departments, plus expert advice provided by the independent advisor to the board’s audit and risk committee.

The cancellation of the tender, which was then in the process of being adjudicated, followed Sanral confirming on 12 March that its contract with Electronic Toll Collections for the management of e-tolls on the GFIP had been extended until December 2020. One of the reasons cited by Sanral for this extension was to allow for the tender process to be concluded.

The reissued tender contains some changes to the eligibility criteria for tenderers. The original tender said only tenders with a B-BBEE contributor status level of 1, 2, 3 or 4, are eligible to tender and tenderers or each member of a joint venture must be registered on the national treasury central supplier database at the closing date for tender submissions. The reissued tender has the same B-BBEE requirements but tenderers are also required to have:

  • An ownership structure where at least 51% is owned by South African entities;
  • Experience of at least one similar project, but not necessarily a toll project, to the value of at least R300-million; and
  • Relevant financial standing to execute the project.

This article was originally published on Moneyweb and is used here with permission