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13-year delay expected for Winelands tolling project

Sanral says the delays will set back the prospect of upgrades to the N1 & N2 highways by at least 13 years.

The face off between Sanral and the City of Cape Town continues in the Western Cape High Court. Picture: Rahima Essop/EWN.

CAPE TOWN - The City of Cape Town had a duty to act expeditiously when it intended opposing the roads agency's N1/N2 Winelands Toll Project, according to South African National Roads Agency Limited's (Sanral) lawyer, Bruce Leech.

Leech told the Western Cape High Court on Thursday that the City's inaction showed indolence or indifference.

The N1 and N2 highways were declared toll roads in September 2008, but the City waited until 2011 to initiate legal action.

In 2013, the roads agency was interdicted from going ahead with plans to toll about 180 km of highway pending the outcome of the City's review application.

On day three of the review hearing, Leech argued the City has not been able to fully explain why it did nothing for a number of years, adding it amounted to an unreasonable delay.

The delay, Sanral contends, will set back the prospect of upgrades to the N1 and N2 highways by at least 13 years.

In legal papers, the agency explained the effect of the delays is that the roads can't be upgraded at least until 2030, by which time the roads would have deteriorated.

The City admitted it could have brought the application sooner, but it's asking the court to condone the delay.

It's challenging the validity of a series of decisions that culminated in the project getting the green light.

At the start of the review hearing this week, the City argued that the socio-economic impact of tolling wasn't considered.

On Wednesday, the City's lawyers argued the minister of transport and Sanral's Board failed to consider "key issues" related to the proposed project.

THESE INCLUDE:

* The potential reimbursement for which Sanral would be liable: the concession contract addresses the risk that the National Minister of Transport may determine lower values than the concessionaire is entitled to charge under the concession contract. It provides that if this occurs Sanral must reimburse the concessionaire by an amount that will place the concessionaire in the same economic position that the concessionaire would have been in had the failure, refusal or delay on the part of the Minister not happened. The potential reimbursement is calculated to be R32,8 billion (2010 real values excl. VAT).

*"The financial viability of the project: the fact that the public will, over a 30 year concession period, pay between R44,9 billion and R48,4 billion in toll fees (2010 values excluding VAT).

* The affordability of the toll tariffs: the base toll tariff in the draft concession contract is equivalent to 74 c/km (2013 values, excl. VAT). This is almost three times the tariff of 26 c/km (excl. VAT) of the Gauteng Freeway Improvement Project.

* The fact that tolling is a financially inefficient means of upgrading and maintaining a road. If Sanral undertook the upgrades and operated and maintained the highways on a non-toll basis, the cost would be R22,5 billion (2010 values, excluding VAT) as opposed to nearly R50 billion.

* The macro-economic impact of tolls on the Western Cape.

* The impact of traffic diversions: motorists will avoid the toll roads and the City will thus face an additional burden to maintain secondary roads. Furthermore, the residents in the vicinity of the secondary roads will be adversely affected by the increase in traffic on these roads.

* The social impact of toll.

* The fact that toll would result in unfair discrimination as the residents who are living along the N1 and N2 freeways are predominantly poor and black, given the fact that poverty is still racially distributed.