Sanral denies that tolls will hike food costs

The South African National Roads Agency Limited (Sanral) has insisted that freeway tolling will not result in increased food prices, following the Democratic Alliance’s e-toll resistance campaign launched this month. The DA argued in its campaign that toll costs incurred by hauliers and truck operators would inevitably be passed on to the consumer as operators increased their fees to redeem the toll costs. However, Sanral has hit back at the claim. “The Gauteng Freeway Improvement Project has a positive impact on the business of trucking. For one, the main objective of the project is to help ease congestion on Gauteng’s busiest highways. Any road user knows that a congested highway can drastically escalate vehicle running costs in the form of wasted fuel and increased vehicle maintenance costs. “The same is true for trucks. So as congestion is relieved on Gauteng’s highways and truck operators spend less on fuel and vehicle maintenance costs due to the GFIP, should we not be seeing a drop in food prices, as the savings in transport cost get transferred to the consumer?” Earlier this year Stuart Farrow, the DA’s Shadow Minister of Transport, said: “There is no doubt that these toll costs will increase the cost of transporting goods and services, and the pockets of the poor will, in turn, be affected disproportionately.” However, Sanral argues that when tolling commences in February 2012, logistics companies will be able to claim back from Sars the toll tariffs as well as the associated VAT, and therefore the cost should not add to freight company operations and consumer prices.” The agency also noted that a major theme in the DA’s campaign was that the toll tariffs were unjustifiably high. “What is not mentioned by the DA is the fact that the finance model for the project was independently reviewed by two independent audit firms and was certified to be completely non-profit based. The finance model adopted for the GFIP is instead completely cost recovery-based.”