On Thursday 24th March 2011, the ORT Steering Committee started public consultations in Midrand. During its presentation, the Southern African Vehicle Rental and Leasing Association (SAVRALA) highlighted the significant ORT admin costs required in contrast to those of the fuel levy. Although it welcomes the new road and interchange upgrades; as the representative body of over 450,000 vehicles SAVRALA is “very concerned about ORT’s direct and secondary admin costs” associated with the management of tags, moving vehicles between locations and the necessary back office systems needed to support billing and customer queries.
Highlighting that the ETC tender of R6.2bn included R4.7bn for operational costs over eight years, SAVRALA’s view is that these could largely be saved by using the Fuel Levy mechanism. The current ORT eTag model also places significant administration costs on businesses which will have to be passed on to customers. SAVRALA estimates that an average car rental customer may have to pay an extra R32 per day in tolls, representing 10% of the average car rental daily rate. Leasing customers could also expect an increase of up to 33% in their cents per kilometer costs.
In proposing other revenue opportunities to help fund capital infrastructural projects which have a national multiplier impact like the GFIP, the economic loss due to accidents at over 3% of GDP has to be reversed and SAVRALA has called for “urgent real road safety enforcement by all stakeholders.” While the estimated 300,000 unregistered vehicles also presented an opportunity for increased license fees, SAVRALA proposed the “re-introduction of compulsory third party insurance” as one of several tools to try and change driver behaviour.
Just like many of the other business associations presenting to the ORT Steering Committee – more notably BUSA, AA, RFA and RMI – SAVRALA is concerned at both the lack of transparency surrounding the SANRAL ORT funding model and the absence of an appropriate platform for transport-related associations to engage effectively with the Department of Transport. In contrast to the developments at SARS, AARTO was quoted as an example of legislation that, from an administrative perspective, is not designed adequately to accommodate some basic technological opportunities which would reduce the current manual process. A closer working relationship would help make future transport related legislation more practical.
SAVRALA, while continuing to engage with SANRAL, have declared a dispute regarding payment terms. SANRAL have demanded that settlement for toll transactions for Key Account Holders be within seven days, failing which interest will be levied on outstanding balances. SAVRALA has received a mandate from their members calling for the generally-accepted business terms of 30 days.
Commenting on the presentation proceedings and the progressive alliance developing between the various transport associations, SAVRALA President Linda Kotze said: “This is hopefully the first step of many in a meaningful and transparent engagement process with both the Department of Transport and SANRAL. The ORT concern has actually had the effect of pulling us all together and it was very impressive to note that at our preparatory meeting earlier in the month, over 4 million vehicles in greater Gauteng were represented. We will now be heard.”
PRESS RELEASE ISSUED ON BEHALF OF SAVRALA BY ADZOO. CONTACT LILI REES ON [email protected]