Pushing up fuel prices to pay for the government’s multi-billion rand e-tolls scheme will no longer be an option, the transport minister has said.

Minister Fikile Mbalula was briefing the media on Thursday about the government’s decision on e-tolls. He said the cabinet had initially decided it would pay for e-tolls by increasing the fuel levy but this has been scrapped.

“There was a decision that was taken by the cabinet on the e-tolls which was taking us in the direction of the fuel levy,” Mbulula said.

“The fuel levy [increase] story has become very messy over time and it is no longer an option we can consider. We are not taking that route.”

He said the cabinet was looking at various options to pay the debt.
Mbalula said a decision on how to finance e-tolls would be made later and announced by finance minister Enoch Godongwana around the medium-term budget policy statement (MTBPS) time in October.

“We are working on the matter. It will happen when the minister delivers the statement or even before that.”

Mbalula has made several promises on the e-toll decision but insisted “this one is for sure, certainly… we agreed even last week”. He said the transport and finance ministries were working on the e-toll strategy ahead of the announcement of the final decision.

“Fuel price has gone up. The conflict in Russia and Ukraine has just made our situation worse.”

The Minister of Transport, Mr Fikile Mbalula joins the Board of the South African National Roads Agency SOC Limited (SANRAL) as it gives an update on progress made on re-advertising SANRAL tenders amounting to R17.473 billion. https://t.co/iIIyKyNR6Z

— ANC SECRETARY GENERAL | fikile Mbalula (@MbalulaFikile) June 30, 2022

Organisation Undoing Tax Abuse (Outa) CEO Wayne Duvenage said the government dragged its feet on the fuel levy option that the organisation proposed be implemented back in 2011. He said this was no longer an option based on the state of the economy and the pressures on the consumer.

“This option was for them to settle the R18-billion in bonds. A 10 cents increase in the fuel levy was proposed by us in 2011 when the fuel levy was R1.78 per litre. We would have already settled these bonds; unfortunately, it is very late now to try and bring in a fuel levy solution,” Duvenage said.

“The current fuel price is out of control and a fuel levy increase would have to be close to 30 cents today which is a serious problem.

“We could never condone that. The government has increased the fuel levy by R2.07 since 2011. Sanral has already been bailed out by the government for the last six years to the tune of R14-billion. That is the mechanism we have always advocated for and we believe it is the mechanism that will be introduced later this year.”

He said the government should just scrap e-tolls.
“The decision is long overdue.”

ALSO READ: Minister of Finance says e-tolls’ user-pay system should not be entirely killed

Earlier this year in parliament, Godongwana said increasing fuel prices would have a “massive impact” and simply put too much pressure on consumers.

Godongwana said that whatever the final decision was, he was of the view that “we should not kill the principle of user-pay – not entirely”.

E-tolls were implemented in December 2013 in Tshwane and Johannesburg but have been rejected by some motorists who refused to pay. Political parties and civil organisations have also protested against the system, putting pressure on the government to scrap them.