OUTA Press Release 26 June 2013

STOP eTOLLS BEFORE IT’S TOO LATE -­- OUTA

Following news of problems experienced by eTolling on Portugal’s SCUT Freeway eToll – as reported in an online article from ThePortugalNews.com (https://www.theportugalnews.com/news/dead-­- loss/28626) -­- OUTA envisages similar, if not worse, problems and concerns for the Gauteng eToll plan.

“Portugal’s eToll problems are very simplar to the type that we have envisaged for the SANRAL’s Gauteng tolling plan,” said Wayne Duvenage, the chairperson of OUTA. “In a country such as Portugal, where compliance and administration efficiency is much higher than in South Africa, it is evident that tolling projects of this nature are subject to a certain level of citizen rejection. Judging by Portugal’s eToll project which has seen a 19% non payment rate by road users, you can rest assured that matters of non-­-compliance will be far worse here for SANRAL, following the outrage and general public rejection of their plans to toll Gauteng’s freeways.”

The Portuguese project has been fraught with lower than anticipated revenue collections, and collection administration costs now as high as 29% of the revenues generated and getting worse. According to Antonio Ramalho (the Chief Executive of the EP concessionaire for Portugal’s SCUT eToll project), in May, the cars travelling on SCUT motorways without an electronic tagging device cost as much to bill as the amount they pay for using the toll road. He went on to say “The system is unsustainable and we hope it doesn’t stay the way it is.”

The article has also raised concerns as to the profitability of charging tolls on previously unpaid or so-­-called SCUT motorways. OUTA warns of similar concerns raised here in Gauteng and the South African authorities would do this country a favour by preventing an embarrassing situation from getting worse. “We urge them not to ignore the signs that point to a rapid failure of the Gauteng eToll project, one which has experienced massive rejection by society. It doesn’t take much to realize that eTolling in Gauteng will be an absolute mess and is unsustainable”, said Duvenage who further suggested that “it would be best to halt this plan before it is too late and to rather extract the revenues required to pay for the freeway upgrade by way of the efficient general tax and fuel levies.

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375 words
Issued by Wayne Duvenage

OUTA PRESS STATEMENT 25 June 2013.

OUTA CONCERNED GFIP COLLUSION FINES TOO LOW

OUTA welcomes the announcement on Monday by the Competition Commission, which fined 15 construction groups a collective total of R1.46bn to settle a multiyear investigation of bid rigging. It is, however, noted that the settlement at 5% of the estimated R30bn in project value, falls well short of the 10% of turnover guideline without adjusting for inflation since around 2009.

Reports further indicate that the collusive behavior impacted the construction of the Gauteng Freeway Improvement Project (GFIP), which SANRAL now plans to Toll in order to fund these costly upgrades. OUTA calls upon the Competition Commission to release details of the extent of the collusion on the GFIP project and further calls for part of the R1,46bn fine to be allocated to SANRAL’s repayment of GFIP. The public should not have to carry the implications of past collusive pricing, into the future.

OUTA has also noted the lack of response, to date, from SANRAL who we would have expected to be outraged by the collusive behaviour related to the GFIP projects. One wonders how SANRAL, who are supposed to be experts at road construction pricing, allowed such collusive behavior to go unnoticed or unchallenged at the time of the GFIP tender process. This decision comes only a few weeks after we learnt of the forecasted annual R670m earnings by Kapsch Trafficom for its share of the Gauteng eToll collection services, which equates to as high as 40% of the estimated eToll collection costs to society.

OUTA wishes to remind SANRAL and its spokesperson Mr Vusi Mona that the eToll decision by the Con Court in September 2012 overturned only the interdict against SANRAL to launch eTolling, which is a completely separate legal matter to the merits of the decision to proceed with eTolling, which will be tested at the Supreme Court of Appeal in September this year. Mr Mona, in his recent comments, appears to not recognise the critical difference nor, for that matter, cannot explain why SANRAL has delayed their eToll launch for over nine months since the September 2012 Con Court case, despite SANRAL’s court testimony which clearly indicated their need and intention to start tolling within two weeks of the interdict being set aside. The regulatory framework is part of the entire process and is still fraught with challenges, some two years after SANRAL’s initial eToll launch dates in 2011.

Indeed, Mr Mona should also take note of the fact that SANRAL had lacked transparency in its dealing with regard to GFIP contract documents presented to COSATU in 2011, which had many pages blanked out. In a more recent court interdict in the Western Cape, SANRAL was stopped in its tracks from forging ahead with tolling plans in that region, due to amongst other things, a lack of transparency on costs and information required for public engagement.

Furthermore, SANRAL has lost in other legal matters before various courts around the country, including the outcome of the HMKL case last year (which resulted in the moving of the Centurion gantry due to the lack of legal compliance to the Environmental Impact Assessment process) and in the KZN South Coast toll concession tender case. These incidents are not smoke nor allegation but fact.

Wayne Duvenage, the Chairperson of OUTA commented that he was “sad to see how the integrity of a once respectable state owned entity such as SANRAL has been tarnished over the past few years, as a result of the GFIP process which has been characterised by high costs, a lack of transparency and irrational decision making. We are hopeful that OUTA’s Supreme Court of Appeal hearing in three month’s time, will finally demonstrate the shocking extent of this matter which has been nothing short of a sheer lack of respect for the citizens of this country.”

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640 Words.
Issued by Wayne Duvenage. Chairperson OUTA

29 Nov 2012

Dear OUTA SUPPORTERS

Wednesday 28 November hopefully marked the end of a long and much tougher challenge than we initially envisaged, after setting out in March to put a legal halt to the eTolling of Gauteng’s Freeways
I say so feeling confident that we have put up an excellent challenge in court against SANRAL, Treasury and the Department of Transport’s respective legal teams this week. While there were many aspects about the eToll matter that are very wrong and are included in our legal challenge (being the high costs, inefficiency, lack of alternative transport and routes, enforcement, compliance, environmental matters and unworkability etc), our legal team felt it prudent to focus our energy in the review on the illegal nature of SANRAL’s shockingly poor public engagement process. Our arguments went deep into interpretation of the Promotion of Administrative Justice Act (PAJA), combined with the Constitution and how Section 27 of the Sanral Act needed to be taken in the context of these laws.
Our case has exposed how SANRAL largely ignored their legal duties to conduct full and proper public consultations on their plan to toll the GFIP, largely under the guise of a ticking ‘Soccer World Cup’ clock. The simple matter is, unless the authorities conduct themselves properly in the ‘public engagement space’, they run the risk of a backlash from citizens, which is precisely why these laws exist, the ignorance of which is being currently expressed by the public outrage and threats of civil disobedience. We have deemed SANRAL’s conduct as sufficiently unlawful and as such, their eToll plans need to be set aside and the process to be properly and legally re-engaged.
Over the past few months, when studying eToll project successes and failures around the world, we find a high correlation with society’s acceptance or rejection of these schemes being based on confidence and trust obtained through excellent public engagement on matters pertaining to reasonability of tariffs, alternative transport options, alternative routes, efficiency and good communication. Without these elements in place to bring society on board, tolling has (and will continue to) fail around the world, even in more disciplined first world environments. Every one of these elements was missing in the plan to toll the GFIP and even if the legal case rules in SANRAL’s favour, the current eTolling plan for Gauteng will be extremely difficult, if not impossible to implement. The truth be told, SANRAL is still unable implement eTolls – some 19 months after the first planned launch date of April 2011, despite their statement in the Constitutional Court in September 2012 that they will launch within two weeks of the interdict being set aside. There is a saying: “Laws are only as good as they are implementable and governable.” In this matter, both implementation and governance will be hurdles too high to jump. We sincerely trust the authorities will be able to acknowledge this sooner rather than later, whatever the legal outcome.
Win or lose in court, I’d like to acknowledge the dedication and tireless work of Marc Corcoran and Adrian d’Oliviera (Jnr Counsel) in getting us to where we are today. Pieter Conradie, Rebecca Thompson, Paul Pauwen, Alistair Franklin, Alfred Cockrel, Kelvin Buchannan and the skilful input of Adv Mike Maritz in the review hearings were all naturally very important and integral to the journey. It would be remiss of me not to also thank the members of SAVRALA, who provided the necessary and significant funding to get the case started, along with the RMI, QASA, SANCU, SATSA and AA, all of whom added immense weight to this cause, in conjunction with over 2300 individuals, families, small businesses and a few larger organisations who contributed to the funding of OUTA’s legal costs – a matter which is still not complete. We plead that business and the public continue to contribute to our legal costs at www.outa.co.za.
We will know the outcome in a few weeks and intend deal therewith and resultant decisions / actions by the respondents, at that time. What is however known, is that this challenge was sincere and meaningfully undertaken to protect our rights as citizens of South Africa.

Wayne Duvenage
OUTA Chairperson

The Department of Transport and SANRAL will be holding three public engagement sessions this week to at which they will be presenting on the e-Toll Exemptions and Tariff regulations and where the public are able to also hand in written submissions and raise questions / concerns.

OUTA urges the public to attend these Public information sessions on the e-Toll regulations at one of the following venues listed below. These opportunities for society engagement should not be overlooked or ignored and we encourage an expression of views to the authorities on the excessive rates and processes related to e-Tolls.

Issued by Wayne Duvenage
OUTA Chairperson

OUTA PRESS RELEASE – 5 Oct 2012

Judging from comments by the Minister of Transport urging the public to purchase e-Tags and other communication being sent out by SANRAL this week, it is clear that Government intends to launch e-tolling before the court review in November.

Having filed its replying affidavit on Monday, OUTA is now even more adamant that the decision to toll the Gauteng freeway upgrade (GFIP) was a poor decision taken by the authorities. “Since having access to the ETC contract, for which we had to sign a confidentiality agreement, our expert transport economist’s assessment of the numbers and efficiency of e-Tolls has revealed that the plan suffers from oversights and is a most inefficient manner in which to fund the R17bn freeway upgrade” says Wayne Duvenage, Chairperson of OUTA.

We expect the IMC to announce their e-Toll plans sometime this weekend or next week, wherein we envisage they will further reduce the e-toll tariffs as well as the capped maximum charge, as they go on the charm offensive to woo the public into believing this is the best option. We also believe their announcement will include the acceptance of e-Tolling by a few entities that were originally opposed to the plan.

OUTA firmly opposes the application of e-Tolling under the veil of ‘user pay’. Given the structure of our economy and the need to support those who lack many of the basic services, it is important that we apply the most cost efficient and effective funding methods.

The reality however is that you can’t be “half pregnant” on e-Tolls. You either e-toll or you don’t. A lesser amount of the wrong method doesn’t make it any more right. According to Clif Johnston of the SA National Consumer Union “The cost of collection and the bureaucratic burden it will place on society are independent of the actual amount charged per kilometre (km). Indeed, as the toll rate per km falls, the collection costs become an increasingly larger percentage of the amount collected”.

“This is the ultimate tragedy of the plan” says Johnson, “being that the road user will still have to foot the bill of more than R1,1bn per annum to cover the electronic toll collection process, regardless of how much they reduce the toll rate and cross subsidise the revenue required with fuel levies and / or the national fiscus mechanisms”.

Gary Ronald, CEO of the AA says “we are concerned about why the contracts still remain confidential. The public, who are ultimately expected to pay the fees, should be given full view of the entire contract. Until now, all we have seen are few tables from the authorities which vary substantially in the costs and projected revenues, casting serious doubt regarding the authenticity and accuracy of these figures”.

Duvenage says “The e-Toll plans are a most inequitable and inefficient ‘user pays’ process and the 8:1 Benefit to Cost ratio for users is a gross over exaggeration and has failed under expert examination. We continue to emphasise that, as per Government’s own documents, transfers from the fiscus and receipts from a fuel levy remain the most cost efficient way of raising funds. What’s more, these methods are included in government policy for revenue generation toward road infrastructure development. Adding to the injustice is a lack of the (planned) upgrading of public transport in Gauteng, which will eventually offer both road users and the general public a reliable, safe and efficient alternative to owing a private vehicle”.

Michael Tatalias, CEO of the SA Tourism Services Association (SATSA) says that “forcing e-Tolling onto the citizens of SA is a gross injustice and implies that citizen’s intellect is being taken for granted by the authorities, that they are unable to detect when a planned revenue / tax collection system is a waste of their hard earned money and time. COSATU’s warnings to government were expected and reflects the strong disquiet within both Gauteng and nationally at the prospect of a national e-Tolling roll out. It is clear that Government should not err by discounting the extent of dissatisfaction with the GFIP e-Tolling plan”.

Ari Seiris, CEO of the QuadPara Association of South Africa (QASA), continues to be concerned for his members who were not consulted during the planning of e-Tolling and are largely unable to use alternative public transport due to its lack of accessibility, convenience and reliability. Whilst a solution is currently being sought for people with disabilities, the last proposed tariff structure and policy makes no accommodation for those without transport but who rely on the generosity of many private individuals to transport them around Gauteng, often using the network of highways.

OUTA has always said it is willing to pay for the GFIP and other national transport infrastructure projects which benefit the country as they are both much needed and long overdue but not via e-Tolling. OUTA remains confident that the November judicial review of the decision to implement e-Tolling will be a strong challenge against the unjust plan.

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Wayne Duvenage

ADDRESS: P O Box 2627, Northriding, 2162
DIRECTORS: Wayne Duvenage (Chairperson), Michael Tatalias (Vice Chairperson), Paul Pauwen (Secretary)
COMMITTEE MEMBERS: Ari Seirlis, Clif Johnston, Jeff Osborne, Marc Corcoran
COMPANY REGISTRATION:  2012/064213/08
WEB SITE: www.outa.co.za

OPPOSITION TO URBAN TOLLING ALLIANCE

OUTA Press Release – 28 May 2012

OUTA welcomes the court’s decision to interdict the launch of e-Tolling, thereby allowing time for the full matter and case to be heard in court. We are pleased that Judge Prinsloo has decided it would be prudent to keep the e-toll ‘horse in the stable’ until this matter is reviewed in full, notwithstanding the recent decision to halt the launch for another month.

OUTA remains adamant that much could have been done by both SANRAL and the Department of Transport to have averted this legal action. We again state that we do not oppose the Gauteng Freeway Improvement Project (GFIP) as there is always a need to improve our infrastructure but we object to the implementation of an unacceptably expensive and administratively burdensome tolling system. It is wasteful to pay additional billions in administration costs when these funds could be diverted to other national transport projects. We believe that the various key decision makers were unable to fully apply their minds effectively, given the information presented to them when the decision to toll was made. It would appear to us that insufficient time and effort was spent empirically challenging the various funding methods available, of which the fuel levy is just one.

Indeed the uniqueness of this particular case, being how the broad spectrum of South African society rallied around the common purpose of e-Tolling, cannot be overlooked. One senses that this may well be the start of new consciousness within South Africa where its citizens have been vindicated and their voices heard.

The interdict victory is just the second round after the case for urgency of this matter was granted in our favour. A much longer and fierce battle now lays ahead as the volumes of documentation will be argued in court to finally prove our case that eTolling is an unjustified, irrational and punitive tax on the citizens of South Africa.

Notwithstanding the interdict which now suspends eTolling until this case has received a full review in court, the authorities recent decision to postpone eTolling is just another example of how poorly this matter has been handled. Five postponements and almost a year after the initial planned launch, SANRAL are still not ready. We are of the opinion that they will never be able to be ready, because in reality, it is only possible to introduce legislation and processes that are practically possible to apply and enforce. eTolling is not supported by the majority of citizens. It is also simply impractical and unenforceable and this this is what SANRAL and the authorities are now starting to realize. By trying to force an unpopular decision on its citizens, the authorities may fast be realizing that this is not a good recipe for a healthy relationship with its people.

We remain hopeful that all parties will find each other prior to the court review, but if this is not the case, we will continue to represent South African road users interests while we seek a more efficient solution to our funding challenges.

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