Rabia Mayet | rabiamayet@radioislam.co.za

01 October 2024

3-minute read

Starting with an initial instalment of R3.8 billion, Gauteng has started paying off its e-toll debt.

In his 2022 medium-term budget policy statement, Minister of Finance Enoch Gogondwana stated that to resolve the impasse, the Provincial government has agreed to contribute 30% to settling SANRAL’s debt and interest obligations, while National Government will cover 70%.

Gauteng Government spokesperson, John Sukazi, mentioned that government’s commitment to paying the full 30% includes the R12.9 billion historical debt, and the R4.1 billion backlog for servicing the roads. The first instalment was paid on September 30^th and the remainder will be paid annually at the determined rate over the next 5 years.

There are implications of how the Gauteng provincial government will have to manage its finances, and John cited that they have worked through the budget to ensure protection of funding for other public services like health, education, and social services. 2

The three sources of funding received by the Gauteng government include the equitable share from National Government; conditional grants; and the provincial-owned revenue, which is the funding the province raises internally through licensing fees, gambling taxes, etc. Within a year, the province is able to raise over R7 billion; thus the province’s own revenue will be used to service its e-toll debt. Their spokesperson’s message to the public is that “the debt will not adversely affect the delivery of services to communities.”

There are also fiscal challenges to be faced with plans in place to resolve these, like strengthening the debt management strategies to ensure the continuous servicing of the debt at the correct intervals without defaulting. Additionally, measures have been put in place to strengthen internal systems to avoid leakages within the system; and working closely with revenue departments so that the budget remains healthy and funds are allocated correctly, so as to have a healthy budget and to cater for debts, as well service other departments within Gauteng, in line with their obligations to the Gauteng community.

There are alternative sources of revenue within the province and systems in place to optimise other revenue streams, and to be able to augment the revenue. Going forward, the Gauteng provincial government has no plans to borrow money to pay back the debt except in the case of boosting the job market and improving the economic infrastructure.

Listen to the full interview on Sabahul Muslim with Annisa Essack.