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June 2015
Infrastructure & Mixed Use
A
ccording to Herron,
SANRAL has presented
figures in the Western Cape
High Court about the Winelands
Tolling Project that has distorted the
financial picture and obscured the
implications of tolling.
“This is in line with SANRAL’s
conduct for secrecy in matters of
public importance. Instead of play-
ing open cards with the public about
the real costs of the proposed tolling
on the N1 and N2 freeways, SANRAL
tries to conceal it with accounting
practices.”
He cites one example of this is
that SANRAL bundles cost groupings.
For instance, the Protea Parkways
Consortium (PPC’s) profits and taxes
are lumped under ‘development and
finance costs’ and not accounted for
separately. In this way SANRAL pres-
ents PPC’s pre-tax profits as being in-
cluded in the costs of ‘infrastructure
operations and maintenance’, which
it describes as ‘non-toll expenditure’.
SANRAL has not considered the
option of constructing the upgrades
to the N1 and N2 freeways by using
publicmoney, even though it ismuch
more efficient and that is how the
majority of roads in South Africa are
financed.
The only alternative to PPC’s
private tolling scheme presented by
SANRAL, is a privately financed non-
tolling scheme. However, a private
non-tolling scheme is unprecedented
in South Africa and has never even
been suggested as an option.
SANRAL’s figures also do not con-
sider the fact that public finance
costs are substantially cheaper than
PPC’s proposal. Another way inwhich
SANRAL distorts the figures is through
the use of discounting, which is
commonly used in accounting prac-
tice SANRAL applies it in a way which
emphasises construction costs and
de-emphasises toll payments and
profits. This makes it difficult to un-
derstand the comparison of construc-
tion costs, toll payments and private
profits. Tolls will be paid for a period
of 30 years and it will be increased
each year in line with the CPI, which
measures inflation. The actual cash
spent on toll payments in the future
is referred to as the nominal amount.
The ‘real values’ remove the effect of
inflation and are the figures which
the city uses. SANRAL however uses
‘present values’ by applying a further
14% nominal value discount.
■
SANRAL
distorts
tolling
figures
T
he new dams and expansions
include Mzimvubu River Dam
in the Eastern Cape, the expan-
sion of the Clanwilliam Dam in the
Western Cape, Nwamitwa Tzaneen
Dams, in Limpopo, Hazelmere Dam
in KwaZulu-Natal and Polihali Dam
in Lesotho.
The Presidential Infrastructure
Coordinating Commission (PICC)
provided progress reports on the
building of water pipelines, treatment
plants and systems to connect local
households.
Presidency spokespersonMac Ma-
haraj said that the report forms part of
the public infrastructure project pipe-
line and includes 18 major Strategic
Integrated Projects (SIPs).
He added, “One of the challenges
to be addressedwith thewater supply
is the separationof functions between
different spheres that result in dams
being completed by national govern-
ment but delays at local level with
water reticulation systems have to
be more coordinated to ensure that
communities have access to water,”
said Maharaj.
More than 220 000 direct jobs
are being supported by the projects
currently coordinated by the PICC,
which include building roads, ports,
rail lines, social infrastructure, energy
plants, dams and pipe lines.
“Thirty-nine renewable energy
plants have been opened with 1897
megawatts of renewable energy com-
ing onto the grid. These solar, wind
or hydro plants have been a critical
support to address the energy short-
ages caused by delays in the new coal
power stations coming on-stream,”
Maharaj said.
ThePICCwas formed to coordinate
amulti-billion rand public infrastruc-
ture programme and brings together
all three spheres of government.
■
Dam
expansions
Government will build as well
as expand six dams over the
next decade to address the
long-term water and sanitation
needs of the country.
SANRAL is doing its best to paint the Winelands Tolling Project
in a positive light, says City of Cape Town Mayoral Committee
Member for Transport, Brett Herron.