According to Skhumbuzo Macozoma, CEO of the SA National Roads Agency SOC Ltd (Sanral), the fuel levy provides insufficient funding for South Africa’s roads – and this situation will only get worse as electric cars become more common.

Sanral announces new transformation policy“The future contribution of the fuel levy to the Central Revenue Fund is uncertain with the projected electric car take-off in 2022 and established vehicle efficiency technologies. In less than five years, electric cars will cost the same as their internal combustion counterparts and that’s the point of lift-off for sales,” he said at a recent conference themed “Roads to Social and Economic Growth” in Durban.

He proposed that a funding policy for transport infrastructure and road infrastructure must be driven by National Treasury working with sector departments. “Funding strategies must be deliberate and agreed. A suite of funding models is available. South Africa must be decisive about how to fund its roads. The needs, priorities, engineering principles and spending efficiencies must inform future spending allocations,” he said.

“Road users must be directly responsible for economic infrastructure, such as roads. The government must provide for social infrastructure such as housing, schools and hospitals. Future tax or pricing mechanisms are required for road users. Equity and direct user charging must be embedded in such future funding sources.”

This viewpoint is unlikely to prove popular, particularly in light of the challenges being encountered by Sanral around Gauteng’s e-tolls. Electronic Toll Collection (ETC) SA, which administers the e-tolls, is issuing 4 000 summonses a month to recover outstanding debts. Sanral has said it needs R67 billion to pay for the Gauteng road upgrades that were done in 2010, which the e-tolls were supposed to pay for.

South Africa has the 10th largest road network in the world with a total road network of 750 000 kilometres (158 124 paved and 591 876 gravel). Sanral has a number of planned projects, but a stalemate with Treasury has put many of these on hold, or delayed them.

Macozoma told the annual conference of the SA Forum of Civil Engineering Contractors (Safcec) that “the unfortunate impasse” with the National Treasury last year would affect the construction sector through an 18-month lag in construction projects. Despite this Sanral has awarded the two mega bridge projects on the N2 Wild Coast at a cost of more than R3 billion, while the seven packages of new road construction currently under design will soon be tendered and involved a projected further budget of about R6 billion.

He also said that Sanral was pushing “very hard” to secure funding for the development of the N3 section from Maritzburg to Durban at an estimated cost of about R20 billion. “It is our hope that with the help of government and industry players, we can unlock the rest of the R128 billion worth of national roads projects that were earmarked for roll-out through private finance, which currently cannot move due to the anti-toll sentiment in the country,” he said.

Image credit: https://www.nra.co.za/live/content.php?Item_ID=5051


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