Pictured: Minister of Transport, Ben Martins

The minister of transport Ben Martins speaking on 22 May at the National Council of Provinces urged the council to accept the Transport Laws and Related Matters Amendment Bill 2012.

This is what the minister said in his speech when requesting the National Council of Provinces to consider the Bill as submitted before approving it.

The South African economy requires infrastructure to develop and grow, create jobs and to fight the scourage of unemployment and inequality.

In terms of the overall infrastructure programme, it is important to note that Government took a decision to proceed with the infrastructure programme, despite the global economic crisis.  Without the required infrastructure funding for roads, human settlements, electricity, water, etc., it will not be possible to pay for and maintain optimally our infrastructure at the requisite level.

The current financial reality in South Africa is that there is a growing budget deficit that, if allowed to increase, will be detrimental to the economy and growth prospects of South Africa.  This reality makes it is necessary to find additional sources of funding to assist the fiscus to meet the various demands made on it, so that social expenditure can be maintained, and infrastructure projects implemented. In order to meet these challenges, these infrastructure projects have to be funded through the selective use of a user charge.  It is the responsibility of Government to implement prudent policies that will result in long term benefits to South Africa.

This outlook, as reflected in the White Paper for Transport, as well as in the National Development Plan makes provision for alternative funding sources from the capital markets and the user pay principle, to implement road development projects.  In the context of the overall road network in South Africa that exceeds 700 000 kilometres, a very small proportion is tolled.  Only 3200 kilometers, approximately 17% of the total national road network of 19000 kilometres, is tolled.  The National Treasury therefore still makes available funding for the bulk of roads in South Africa, and tolling is used selectively to provide high standard infrastructure.

Funding the Gauteng Freeway Improvement Project through a user charge has enabled the upgrading of some 201 kilometres of roads that would otherwise have taken in excess of 12 years to fund with the concomitant loss of opportunity.  Furthermore, it also ensures that funds for future maintenance and operations are available.  Without this project, traffic in the province would have been in gridlock by now.  Members may be interested to note that the traffic volumes on the Gauteng freeways increased with between 27% to 42% for different freeway sections, since 2006.  On the N1 between the Allandale Interchange and Buccleuch interchange, morning peak hour traffic increased from 9000 vehicles in 2008 to 13 000 vehicles in 2013. An independent survey carried out by a company providing navigation services showed that the improvements have led to a 50% reduction in travel times on the N1 between Johannesburg and Tshwane in peak hours.

This translates into huge savings to the economy. Prior to this, a study conducted by the South African Chamber of Commerce and Industry showed that the loss to the economy due to congestion was in the order of R10million per hour.

The electronic toll collection system, popularly known as e-toll, is a mechanism for the collection of tolls without disturbing the flow of traffic, at least cost. This system is already in use in the east of Pretoria on the Platinum toll highway and is programmed to also be implemented at other existing tollplazas.

Notwithstanding the consultations since 2006 with various stake holders including NEDLAC, Government again engaged with stakeholders at various times through various structures over the past two years with regard to the Gauteng Freeway Improvement Project.  These engagements were aimed at finding ways to mitigate issues that were raised by stakeholders and the public.  These engagements took place via a Steering Committee that was appointed by my predecessor and the Inter Ministerial Committee appointed by Cabinet and chaired by Deputy President Motlanthe.  Engagements took place with organised labour, religious leaders, stakeholders representing road users the AA, the Road Freight Association, OUTA and directly with the public.

In order to assist the public and business, various measures were announced by Government which include the following:

1.    The exemption of qualifying public transport vehicles that are providing commuter public transport services;

2.    A financial contribution of R5,7 billion by National Treasury that enabled the reduction of toll tariffs;

3.    Increased e-tag user discounts;

4.    The introduction of monthly toll caps for qualifying vehicles (vehicles registered and fitted with e-tags); and

5.    Increased time of day discounts, especially for heavy vehicles.  These discounts will also serve as a travel demand management measure that will encourage heavy vehicles to travel outside peak periods.

The Transport Laws and Related Matters Amendment Bill 2012 will enhance the legislative framework for the implementation of projects with electronic tolling, and will assist to improve the effectiveness of toll operations and enforcement.

The Bill has been necessitated by the development of the Gauteng Freeway Improvement Project (GFIP) as well as the future plans for the development of road infrastructure in the Republic.

The South African National Roads Agency Limited (SANRAL) was established in terms of the South African National Roads Agency Limited and National Roads Act 1988 (SANRAL Act).  The SANRAL Act was brought into operation on 1 April 1998. It established SANRAL to manage and control the Republic’s national roads system and to take charge of the development, funding, maintenance and rehabilitation of national roads within the framework of government policy.  The existing Act further provides for the establishment and operation of toll roads, including provisions for electronic toll plazas.

Apart from the physical infrastructure, the GFIP will result in the operation of a road network that involves the utilization of “intelligent” transport systems. An important component of the network is the Electronic Toll Collection (ETC) system. The Bill is essential to enhance the appropriate implementation of the ETC system.

Honourable Chairperson, the Bill seeks:

1.    To provide more effectively for the collection of toll;

2.    To amend the Cross-Border Road Transport Act, 1998 (Act No. 04 of 1998) in order to empower the Cross Border Road Transport Agency to assist SANRAL in the collection of tolls at the border posts.

3.    To amend the SANRAL Act to insert a definition of “owner”;

4.    To further provide for the differentiation in respect of the amount of toll that may be levied;

5.    To provide that the regulations made by the Minister of Transport must be published by notice in the Government Gazette calling for comments from members of the public;

6.    To empower the Minister of Transport to make regulations relating to specified toll related matters;

7.    To provide for certain presumptions relating to the driving, operation and use of vehicles on toll road and the use of electronic evidence to prove an alleged contravention of the SANRAL Act;

8.    To exclude the levying and collection of toll from the ambit of the National Credit Act, 2005; and

9.    To amend the contents of the SANRAL Act.

The non-collection of tolls may impact negatively on the ability of SANRAL to raise capital for infrastructure development projects. The Bill must be seen in the context of Government’s plans to fund its envisaged infrastructure programme. SANRAL has issued bonds to fund the project of R20 billion plus capitalized interest amounting to approximately R3.4 billion that needs to be paid from the toll revenue. Failure to collect tolls and repay the bonds would have very serious financial implications for SANRAL and for the National Government which approved guarantees in respect of most of the SANRAL roads.

The inability to collect revenue would damage the credit reputation of SANRAL amongst investors, who may price the bonds higher to cover this risk. This in turn would likely have a negative impact on both SANRAL and the government’s credit ratings.

A draft amendment Bill was published in Government Gazette No. 31715 on 19 December 2008 and again on 15 March 2010 for public comment. This particular bill was published for public comment by the Transport Portfolio Committee on 15 August 2012. A Notice of intention to introduce the Bill in Parliament was also published in Government Gazette No.35550 of 2012 under Notice No. 661 of 2012.

The Bill was presented to the Portfolio Committee on Transport. The Portfolio Committee also called for public hearings on the Bill and various organization like COSATU, SALGA, The South African Chamber of Commerce made representations to the Portfolio Committee and the committee incorporated some of their comments. The Portfolio Committee considered the Bill and it was adopted by the National Assembly. The State Law Advisor has certified this Bill as Section 75 Bill.