Current fuel levy 'can’t meet' Sanral's funding requirements
According to the roads agency, National Treasury policy precludes the ring-fencing of funds.
CAPE TOWN - The South African National Roads Agency Limited (Sanral) says the current fuel levy can't meet its funding requirements.
The agency has set out its funding constraints in legal papers, as it opposes the City of Cape Town's bid to stop the proposed N1/N2 Winelands Toll Project.
The City is challenging a series of decisions that led to the highways being declared toll roads.
In its heads of argument, Sanral argued, not only does it have no authority to impose a fuel levy, but National Treasury policy precludes the ring-fencing of funds.
In any event, it said the current fuel levies are insufficient.
The roads agency relies on funds appropriated by Parliament, tolling and loans.
Today, the agency's lawyer, Chris Loxton, said the City of Cape Town wants the court to believe that Sanral has engaged in an 'act of financial lunacy' by declaring the N1 and N2 toll roads, selecting a preferred bidder and negotiating a concession contract.
The City has pointed out that the draft concession contract provides that if the transport minister determines a tariff lower than the Base Toll Tariff, Sanral will have to pay the shortfall to PPC, the developer.