South Africa will review the payment options recommended to finance the upgrade of highways in Gauteng province after opposition from unions and motorists.
A report, released today by Premier David Makhura, found that in its current form the e-toll system is not affordable and places a burden on middle-to-low income households. “The primary recommendation is that the current system must be reviewed on equity, sustainability and affordability,” Makhura told reporters in Johannesburg.
The South African National Roads Agency SOC Ltd. has at least 33.1 billion rand ($2.9 billion) of principal debt outstanding, according to data compiled by Bloomberg. Its projects include the improvement of highways in Gauteng, the nation’s most populous province that includes Johannesburg and the capital, Pretoria. As much as 60 percent is backed by the government.
An electronic tolling system, which operates under a “user pay” principle, was implemented in December 2013 and has been opposed by labor unions, car rental companies and motorists who refuse to pay, with some burning e-toll tracker tags in protest.
Deputy President Cyril Ramaphosa is leading the national government’s participation in the consultations with other stakeholders, according to Makhura.
“Consultations into the recommendations and looking into a funding model that is affordable, sustainable and equitable will be finalized in February,” Makhura said. “As we are finding appropriate responses to the issues that were raised on the e-tolls, which have been identified as valid, people must continue paying their e-tolls.”
Source: Bloomberg
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