Sanral: There’s no record to declare N1/N2 toll roads

The declaration was published in the government gazette in September 2008 signed by Sanral CEO Nazir Alli.

FILE: DA members picketing outside the Western Cape High Court against Sanral’s application to keep tolling details secret on 4 August 2014. Picture: Siyabonga Sesant/EWN.

CAPE TOWN - The South African National Roads Agency Limited (Sanral) said there was no written record of a resolution by its board to declare the N1 and N2 toll roads despite efforts to find documents.

The declaration was published in the government gazette in September 2008 signed by the roads agency's CEO Nazir Alli.

Sanral argued that just because there's no evidence it doesn't mean the decision wasn't taken.

It was opposing the City of Cape Town's application for a review of the Winelands toll project in the Western Cape High Court.

The road agency's lawyer Chris Loxton tackled the issue of the missing resolution as he wrapped up his oral submissions for the day.

Loxton said Alli made a great effort to find the paper.

He said the court has been presented with two possibilities in this case.

He explained the city's argument that the roads agency's board didn't take a decision because it didn't know it had to, is improbable.

In legal papers, Sanral pointed out its 2009 annual report showed the board knew about the minister of transport's approval of the declaration and that tender documents were being finalised.

UNREASONABLE DELAY

On Thursday, Sanral also argued the city's delay in challenging the toll project will set the prospect of upgrades to the N1 and N2 highways back by at least 13 years.

The roads agency's lawyer Bruce Leech told the court the city is trying to reverse several years of planning by attempting to send Sanral back to the starting blocks.

The city launched its legal challenge just short of three and a half years after the highways were declared toll roads in 2008.

The city has admitted it could have launched the application sooner, but it's asking the court to condone the delay.

One of the hurdles that the city will have to overcome, as it fights to have the toll project scrapped, is the argument that it waited too long to bring the legal challenge.

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.