Gauteng Government Takes Major Step to Pay First R3 Billion Payment Towards R12.9 Billion E-Toll Debt

R12.9 Billion E-Toll Debt: Gauteng Government Pays First R3 Billion.

The Gauteng government has taken a significant step in addressing the province’s enormous e-toll debt by making its first payment of R3 billion. This is part of a larger effort to settle the staggering R12.9 billion owed for the now-decommissioned e-toll system. The move marks a key turning point in the long-standing controversy surrounding the e-toll scheme, which had been a burden on the province for nearly a decade.

The e-toll system was introduced in Gauteng in December 2013 as part of the Gauteng Freeway Improvement Project (GFIP), aimed at upgrading and maintaining the province’s critical road network. The e-toll system used electronic tolling to charge motorists for the use of specific highways. However, from its inception, the system faced heavy public resistance due to high costs, inadequate consultation, and concerns over the fairness of its implementation.

The e-toll system, initially intended to help finance the GFIP, came with a hefty price tag. The total project cost exceeded R20 billion, with the South African National Roads Agency (SANRAL) taking out loans to fund the project. The idea was to recover the costs through toll fees collected from road users, but the expected revenue never materialized. As of 2022, the total debt related to the e-toll project stood at R12.9 billion, a significant financial strain for both the Gauteng government and SANRAL.

Despite its intentions to improve Gauteng’s infrastructure, the e-toll system quickly became one of the most unpopular government projects in recent history. Public outrage grew as motorists refused to pay the toll fees, citing excessive charges and poor communication from authorities. The Opposition to Urban Tolling Alliance (OUTA) and other advocacy groups led protests and campaigns encouraging motorists to boycott the system.

By 2021, less than 20% of motorists were paying their e-toll fees, leading to significant financial losses. SANRAL struggled to collect revenue, and the system became unsustainable. After years of public protests and legal battles, the national and provincial governments agreed to scrap the e-toll system entirely. The decommissioning was seen as a victory for the people of Gauteng, but the debt left behind by the project remained a pressing issue.

The R12.9 billion debt associated with the e-toll project accumulated as SANRAL and the Gauteng government failed to generate enough revenue from toll fees to repay loans. Despite attempts to enforce compliance, the boycott from motorists meant that the tolling system could not cover the costs of building and maintaining the roads.

In addition to the lack of toll payments, the operational costs of running the system, including the installation of gantries and the maintenance of the tolling infrastructure, added to the growing debt. As a result, SANRAL faced increasing financial strain, with mounting interest on the loans and no viable means to pay them off.

The Gauteng provincial government made its first payment of R3 billion towards the R12.9 billion debt. This payment marks a significant step in a broader plan to settle the entire debt over the next few years. The funds are part of a financial agreement reached between the provincial government, the National Treasury, and SANRAL to ensure that the debt does not cripple the province’s financial health.

This initial payment represents roughly 23% of the total debt and is seen as a critical measure to begin restoring Gauteng’s financial standing. The province has committed to making additional payments in the coming years, although the exact timeline for settling the full R12.9 billion has yet to be disclosed.

Gauteng MEC, Lebogang Maile has expressed that there will not be an impact on service delivery in Gauteng despite the financial challenges the province will be facing while paying this debt.

With the e-toll system decommissioned and the first step toward debt repayment made, the focus now shifts to how Gauteng will manage its road infrastructure moving forward. While the e-toll system is no longer in place, the province still faces significant challenges in funding and maintaining its highways.

Alternative funding models for road infrastructure have been discussed, including the possibility of fuel levies or other forms of road user charges. However, no clear decision has been made, and for now, the Gauteng government is focused on addressing the debt left behind by the e-toll project.

The R3 billion payment made by the Gauteng government toward its R12.9 billion e-toll debt marks a significant milestone in the long-standing e-toll saga. While the decommissioning of the system was a victory for motorists, the financial burden remains, and this first payment is just the beginning of a larger effort to resolve the province’s debt crisis.

As Gauteng continues to navigate the challenges of funding its road infrastructure, the lessons from the e-toll system will likely shape future policies on how public infrastructure projects are financed and implemented. For now, the province has taken a major step toward alleviating its financial obligations, and the coming years will determine how successfully it can manage and eventually eliminate the remaining debt.