Until South Africa heeds the lessons from e-tolling nightmares in Gauteng and beyond, it will be condemned to repeat them
The Gauteng e-tolling saga has become a disaster of titanic proportions for Sanral CEO Nazir Alli.
A century after the sinking of the supposedly unsinkable Titanic, Alli has, with the e-tolling system, steered us into unsafe waters at high speed with overweening faith in technology.
At Sanral, the problems began with assumptions made during the design of the system , and the planning that launched Sanral on its present course.
The extraordinary sequence of events that unfolded in the final week of April has not only shown the folly of e-tolling, it has dispelled the mirage in transport policy created by two immiscible ideological currents within the tripartite alliance.
On Saturday Judge Bill Prinsloo capped a week of political and legal battles by ruling in the High Court in Pretoria to allow the “passengers” and their lawyers to assume de facto command of the vessel. If Outa (the Opposition to Urban Tolling Alliance ) does not run out of steam, this will become de jure, too.
There are some obvious lessons from history to be salvaged amid the wreckage of the Gauteng e-tolling disaster – and from another disastrous Sanral project in a place famous for its shipwrecks: the Wild Coast.
It was on May 23 2004 that things started going wrong for Alli. That was the date that he ignored a letter from former Anglican bishop Geoff Davies, of the Southern African Faith Communities’ Environment Institute. Davies had written to him warning: “If you consulted the public, you would find there is much we could do together. Your present course of action is only leading to increased and highly disturbing conflict.”
The background to this: in 1999 Alli had received an “unsolicited proposal” from an entity known as the Wild Coast Consortium offering to realign the N2 by means of a short cut along the Pondoland Wild Coast and upgrade the N2 between Durban and East London, in return for a 20-year tolling concession.
The consortium had worked out that the National Treasury would still need to invest approximately one-third into the R4.8-billion budget (now escalated to approximately R11-billion) to bring it within reach.
The “green bishop” felt it was simply the wrong way to go and decidedly the wrong thing to do. He argued that the short cut would make the mining of the lucrative Xolobeni heavy mineral deposits feasible, threaten the Pondoland Centre of Endemism, and destroy a rare stretch of God’s good earth.
In his view, the proposal could never be redeemed by mitigation measures. It was simply wrong: another misguided instance of the state trying to solve big problems with big solutions.
They met to try to find a compromise.
Alli said that the purpose of the road was to alleviate desperate poverty by affording access for marginalised and vulnerable rural residents into the mainstream of the South African economy.
Davies questioned why it had to be a tolled road when the Treasury had already committed about R3-billion to pay for massive bridges to span the deep coastal gorges that define the Wild Coast.
From his experience as pastor of the Anglican flock in the area, Davies knew what their priorities were. He had lost one of his best priests, the Rev Hlwatika Madoda, in a car accident on a treacherous stretch of neglected R61 near Flagstaff.
“Why not invest that money in upgrading the existing infrastructure?” he asked.
Faced with such a gaping flaw in the developmental rationale of the scheme, Alli lost his cool, stubbornly insisting that there could be no highway but his way. When he calmed down, he offered to improve the existing road infrastructure, provided Davies withdrew his objections.
This was like offering bread to the hungry on condition that the rich could continue to indulge themselves with cake. Only a bridge of titanic proportions could span their respective positions. No deal.
Alli continued his aggressive media campaign to try to counter opposition to his scheme.
He adamantly maintained that the massive scheme would help solve the problem of poverty, that the particular route favoured by Sanral was the only technically feasible and financially affordable option, and that the proximity with the Xolobeni mineral sands venture, which by then had moved firmly into the prospecting stage, was purely coincidental.
It was a massive setback for Alli when the then Minister of Environmental Affairs and Tourism, Marthinus van Schalkwyk, set aside the environmental authorisation.
The fatal flaw was the “lack of independence” of the environmental consultants, Bohlweki and Associates, who had done the environmental impact assessment report. The late Rufus Maruma, proprietor of Bohlweki and Associates, was also chairman of the board of Stewart Scott International, one of the five companies in the consortium.
However, this conflict of interests did not kill the scheme. Van Schalkwyk allowed Alli a second chance.
And when the c onsortium disappeared from public view and Alli suddenly included Sanral as “scheme developer”, suspicion mounted as to how “unsolicited” the proposal really was.
Davies asked me to intervene in my professional capacity as a social worker to see if anything could be done to influence Sanral towards an alternative alignment of the route away from the environmentally sensitive areas and, crucially, away from the titanium-rich Xolobeni mineral sands.
Alli agreed to meet me. He rejected any compromise with Davies on either realigning the route or forsaking tolling as a funding model.
I asked if rumours that tolling was envisaged on urban roads around Gauteng were true.
“Yes, but to talk about toll roads is misleading,” he said, “it is about the ‘user pay principle’.”
It was the “right thing”, and to do it right “intelligent transport management systems” (that is, e-tolling) would be most efficient.
There was no transparency as to exactly who it was that the user would pay, and how much the private concessionaires would receive.
Unconvinced, I then applied for a copy of the development agreement struck between Sanral and the Wild Coat Consortium.
Alli refused because of the potential harm it might cause to the “commercial or financial interests of a third party”.
But what about the interests of rural residents who would be displaced by the road?
That question had to be answered by the rural residents, not Alli.
I embarked on a six-year “ground-truthing” investigation to find out.
My forthcoming book, Wild Coast Awakening: Peace-building and truth-telling amid the development conflicts of Pondoland, details chapter and verse of an amazing story. Suffice to say I found nothing to justify spending billions on the impressive, large-span bridges required by the short cut that substantiates the case for any long-term “national interest” being served.
Neither did I find any evidence whatsoever to give credence to Alli’s claim that the N2 short cut would be an effective means of alleviating the poverty of local residents who are likely to be displaced.
What I did find were rumours and suspicions that certain politicians and senior officials had allowed their personal interests to conflict with their public duty.
It became abundantly clear that the main beneficiaries of the N2 short cut would be the shareholders and directors of the mining rights applicants, Australian-listed venture capital outfit MRC and their black economic empowerment partner Xolco.
I learned that the new road was “mission critical” to the success of the mining venture.
Alli insists that the mining venture only emerged in 2002, “five years after the N2 Wild Coast short cut was conceived of in 1997″.
In fact, 2002 was the year that MRC publicly announced that the Department of Trade and Industry-controlled SA Export Development Fund had approved an R18-million loan as seed funding for MRC to develop a prospectus for investors in the venture capital market.
Mark Caruso, CEO of MRC , told me that he had first been invited by nameless government officials to the Xolobeni area in 1996, a year before the N2 Wild Coast toll road was conceived, with a view to developing a mineral sands mining operation.
He undertook to raise foreign capital for both the mining at Xolobeni Mineral Sands and the beneficiation thereof in a new smelter to be constructed in East London.
In return, the government assured him that full mining rights would be duly awarded – and that the necessary road infrastructure to truck the concentrate from Xolobeni to East London by the shortest and flattest route possible (which so happens to be Sanral’s preferred route) would be provided. Thirdly, it assured him that seed funding would be arranged.
The mining rights were awarded, but revoked after local residents successfully appealed. The N2 was ultimately approved, but faced a similar fate when the High Court in Pretoria ruled for it to be set aside.
Even though one case deals with the legality of e-tolling and the other with environmental impact, both hang on constitutional principles, and the legal teams of the two cases have been comparing notes.
So far the only promise the South African government has kept was to lend MRC R18-million. Caruso and his investors are not impressed.
There is also a lesson to be learnt from 1893, when President Paul Kruger angered the uitlanders digging for gold by erecting toll gates on the seven major entrances into the Johannesburg gold fields.
The diggers complained that these were punitive taxes to provide revenue for the near-bankrupt Zuid-Afrikaansche Republiek, or South African Republic, not to maintain the roads. Seven years later it was war.
Indeed, there is a lesson to be learnt from the 1970s, when the National Party government plundered the Fuel Levy Fund to finance the then SA Defence Force’s illegal occupation of Namibia and the war in Angola.
It is good that the ANC and Cosatu suddenly suspended e-tolling plans on April 26 2012. It would have been better if the ANC, when it won the election of April 27 1994, had de-militarised our society by again ring-fencing the fuel levy for designated road construction and maintenance.
Why did Alli ignore Davies’s prophetic warning about “increased and disturbing conflict” in May 2004? Had he not done so, the Wild Coast rural residents and Outa would not have to raise money for costly court action.
Why was the Treasury not more forthcoming to explain the contradictions in the N2 Wild Coast funding plan? Had it been so, perhaps the Minister of Finance, Pravin Gordhan, would not now be frantically rushing around to rearrange the deck chairs on this sinking ship.
Why were some in the media so generous with page space and airtime to broadcast Sanral’s propaganda, instead of helping me and Davies investigate who the user would have been paying, and for what, once the gantries went up on the N2?
Had they not been so, maybe there would have been more transparency with respect to the e-tolling deal.
Let’s exorcise those ghosts first. They will continue to confuse our SOS signals unless we do.
