The South African National Roads Agency Limited (Sanral) has refuted a recent media report suggesting that the cost of operating the controversial Gauteng open road tolling (ORT) system had surged by R14-billion when compared with original estimates.

Sanral, which has invested R17,5-billion to upgrade the province’s highways, described the assertion that operating costs had more than doubled from the initial R6,22-billion bid by the winning consortium, Electronic Toll Collection (ETC), as an “incorrect interpretation” of the figures in a leaked document. ETC is a joint venture between Traffic Management Technologies, of South Africa, and Kapsch, of Austria.

There would, thus, be no consequences for toll fees, which were currently the subject of a review by a steering committee appointed by Transport Minister Sibusiso Ndebele.

The agency argued that The Star had “wrongly” included future estimates related to contract price inflation in its calculation, as well as figures for provisions, contingencies and value added tax (VAT).

“The original scope of works has never changed,” the agency stressed in a statement, adding that its application of contract price inflation was “in accordance” with international best practice, and had been confirmed by two independent audits.

It was, thus, “unfortunate” that the figures in the leaked document were misinterpreted to reflect an increased amount.

In a statement Sanral went on to explain that, given the ten-year ORT operations contract, ETC had not been asked to include an estimate for the effect of inflation, which was deemed an “immeasurable risk”.

The amount quoted in the leaked document, was an estimate of future consumer price inflation (CPI) and would have to be continuously adjusted to the actual CPI figure.

The R3,39-billion figure was, thus, a contract-price-adjustment forecast up until April 2019.

Should the prevailing CPI of around 4% be realised, the adjustment would be R2,15-billion. At 6%, the figures would increase to R3,27-billion, and at 9% to R5,16-billion.

The contract allowed for contingencies for unforeseen expenses and for provisions. Provisions covered such aspects as services, costs and equipment that might be procured separately, as well as direct costs, such as municipal rates and services accounts.

VAT, Sanral, adds would be applied to any product or service provided and would be paid over to the South African Revenue Service.