25 Feb 2013
The Competition Commission’s annual report of 2012 has listed collusion in the construction industry between companies that were involved in the Gauteng Freeway Improvement Project (GFIP). “This will certainly add to the already high levels of mistrust of the eToll plan, which Gauteng citizens are extremely angry about. To now hear that the roads cost more than they ought to, simply adds more fuel to the flames of anger” says Wayne Duvenage, the Chairperson of the Opposition to Urban Tolling Alliance (OUTA).
More worrying is Sanral’s relative silence on the construction collusion around GFIP, as one imagines this revelation should have provoked the ire of Sanral’s management, with calls for thorough investigations to retrieving the millions or billions of rands overcharged and thereby reduce the long term debt for society. A lack of energy from Sanral around the collusive behavior of their suppliers, heightens societies views that Sanral does not have the best interests of the South African citizen at heart.
OUTA is not surprised at these latest claims of price fixing and collusion related to GFIP road construction costs, as this may partially explain the exorbitant increases in the GFIP construction costs. “A series of figures provided by Sanral (in various documents) between 2004 and 2012, shows that GFIP construction costs rose by over 350% suggesting that something was amiss” says Duvenage and adds “but it appears that more may need to be investigated to explain these high costs”
Even if one ignores the 350% increase from original estimates of R4,5bn in 2004, (which incidentally was noted for a 340km Gauteng Freeway upgrade recorded in SANRAL’s 2005 to 2008 declaration of intent), society has every right to be angry at the almost three times cost of R17,9bn final GFIP road construction costs, when compared to the figure of R6,4bn estimated by Sanral in 2006 for the 185km upgrade project. Increases of this extent on any sizable capital expenditure project in the private sector would see executives packing for new jobs. These exorbitant cost increases, combined with the cloud of construction industry collusion warrants a full independent inquiry into the entire costs of GFIP, which for too long been shrouded in a lack of transparency, secrecy, high costs, blanked out pages and a severe lack of public consultation.
HAS SANRAL EVER BEEN READY TO TOLL THE GFIP
The Department of Transport has now announced that e-Tolling will shortly commence, following some regulatory approvals, but the question must be asked, ‘what are the real reasons for the multiple delays in the launch of their eToll plans?’ In August 2012, Sanral’s lawyers argued hard and loud in the Constitutional Court that they urgently needed to start tolling and would begin to do so within two weeks of the e-toll temporary interdict being set aside. This was granted by the court a month later in September, giving Sanral the ‘green light’ to commence with their t-Toll plans for Gauteng’s freeways, whilst the matter was being challenged in the courts. Well, it’s nearly six months later and they have yet to start tolling.
In fact, it is now some two years since Sanral’s initial planned launch date of April 2011. Could it be that they have never been ready, that the system is extremely cumbersome and almost unworkable, something that OUTA has always claimed about this ambitious and inefficient method to raise revenue from society to pay for road upgrades.
FUEL LEVY LOGIC IS STILL IGNORED!
What makes the entire decision to toll an even greater farce, is that, had a 10c per liter charge had been added to the fuel levy back in 2006 - when the plan for GFIP was well underway - the authorities would have raised over R11bn by now, which, when combined with the R5,7bn allocated by Treasury in 2012, the entire GFIP road capital costs would have been catered for today. What an incredible waste of time this has been. It certainly begs the question, what on earth can be so good about this unpopular, cumbersome, inefficient and expensive system that the authorities are so hell bent on forcing it into being.
OUTA’s FUNDING CHALLENGE
OUTA expresses its gratitude to the thousands of citizens, families and businesses who have contributed to the R8,3 million raised to date, but makes it clear that the alliance is well behind in the ‘batting rate’ and needs to still raise the remaining R3,5 million required for current and expected legal costs through to the appeal in the Supreme Court later this year. Donations to this cause can be made via their web site at
Issued by Wayne Duvenage – Chairperson of OUTA