Call for ‘proper audit’ as Outa suspects Gauteng govt ‘overpaying Sanral for GFIP bond debt’

The Gauteng government – and by implication, taxpayers – plans to contribute to the R12.9 billion towards the decommissioning of e-tolls using a new “hybrid model to draw revenue”.

But the Organisation Undoing Tax Abuse (Outa) still does not understand how the province found itself so deep in debt.

Decommissioning of e-tolls

Gauteng premier Panyaza Lesufi yesterday met Finance Minister Enoch Godongwana and the South African National Roads Agency Limited (Sanral) technical team, along with finance MEC Jacob Mamabolo and transport and logistics MEC Kedibone Diale-Tlabela on the decommissioning of e-tolls.

The purpose of the meeting included determining the 30% contribution by the Gauteng government towards settling the e-tolls debt, as well as the funding model of the Gauteng Freeway Improvement Project (GFIP).

National government to settle 70% of the debt

Godongwana announced during his mid-term budget speech that national government would pay off around 70% of the R43 billion debt, committing to pay R23.7 billion through a Special Appropriation Bill.

Outa chief executive Wayne Duvenage said Outa did not agree with the R43 billion amount because Sanral only borrowed R20 billion for the GFIP.

Duvenage said it was GFIP debt and there was no e-tolls debt for Gauteng to settle, just the GFIP debt. “Sanral had already received R23 billion over the past 10 years from Treasury for that debt and so it appears there was no allocation of funds that Treasury gave Sanral towards the debt and we want to know why not,” Duvenage said.

“We think Gauteng is overpaying Sanral for the GFIP bonds debt.”

Long-term repayment period

While Lesufi said the provincial government would negotiate a long-term repayment period on the 30% debt and the timeframes to be advised by the technical team, Duvenage said the first question was why they paid 30%.

“It is 30% of what?” he asked. “We do not believe it is R43 billion. It should be far less than that.”

Expert weighs in

Chief economist at Efficient Group Dawie Roodt said it was important to note the debt might have spiralled because much of it was borrowed abroad in dollars and since the rand weakened, the debt will increase in rand terms.

“I guess there could be forex losses and it may be a significant part of the increase in their debt,” he said.

“A proper audit needs to be done.”

Lesufi noted the provincial government would undergo a consultative process with Gauteng residents on the hybrid model.

“A long-term repayment period will ensure that we relieve the pressure on the provincial government fiscus, while maintaining the delivery of social services and other imperatives such as fighting crime,” he said

This month, Lesufi had said that in terms of maintenance, the provincial government’s proposal was mainly on the 30%.

Godongwana said a technical team was further mandated to “thrash-out” the maintenance part of the deal, as well as the process to decommission the e-tolls.

“More work still needs to be done jointly by the Gauteng government, the national department of transport, Sanral and National Treasury to clarify maintenance and decommissioning of e-tolls,” he said.

ALSO READ: Gauteng to contribute R12.9 billion towards the decommissioning of e-tolls

– lungas@citizen.co.za