E-tolling: ConCourt savages high court ruling
The Constitutional Court on Thursday set aside an interim interdict preventing the South African National Roads Agency Limited (Sanral) from instituting toll fees for some of Gauteng's major roads.
Speaking after the unanimous decision was handed down, transport director general George Mahlalela, said the inter-ministerial committee set up to deal with the Gauteng Freeway Improvement Project "would have to meet to study the ruling before a decision on a way forward can be made".
Wayne Duvenage, chairperson of the Opposition to Urban Tolling Alliance (Outa), which had opposed government's application to have the interim court order preventing tolling set aside, said the judgment was "expected".
Tolling was due to start on April 30 this year, but was postponed for a month after meetings between Cosatu and its alliance partner, the ANC. Outa had, earlier this year, applied to the North Gauteng High Court to have government's decision to start tolling Gauteng's motorists, following an upgrade of major freeways, reviewed.
The matter is set to be heard in November and Duvenage said the Constitutional Court ruling would "not scupper" that process.
Duvenage added he did not believe tolling would start before the November hearing as procedures including "sorting out exemptions, tariffs and conditions" relating to tolling had to be completed first.
In a blistering judgment, authored by Deputy Chief Justice Dikgang Moseneke, the decision to temporarily stop the tolling process by North Gauteng High Court Judge Bill Prinsloo earlier this year was savaged for its "deafening silence on the over-arching consideration of separation of powers".
The judgment found several instances where the interim court order encroached on the functions on Parliament and Cabinet.
Moseneke noted that, in handing down a restraining order, courts had to weigh up the inconvenience caused to the applicant if it were not awarded against the inconvenience suffered by the respondent if the order was granted – the "balance of convenience test".
Moseneke found that the high court should have placed "due weight on the uncontested evidence that 99% of the burden of tolling would be borne by more affluent road users … the harm that these users will experience will therefore not be of a pressing or acute kind". This, he noted "did not exceed the "prejudice that the national executive government, national treasury and Sanral will have to endure should the temporary restraining order be granted".
"The immediate and ongoing result of the interdict," Moseneke found, was that Cabinet, Parliament and the treasury "will have to allocate R27-million per month to Sanral in order to meet its ongoing capital and interest payments in respect of the [Gauteng Freeway Improvement Project].
This meant wide-ranging consequences for national finances and the management of our country's sovereign debt."
Sanral had incurred a R21-billion debt to finance the first phase of the freeway project, of which government had guaranteed R19-million. In the event of a default, the court noted, government "runs the risk of being called upon to pay the full outstanding debt … at once".
This impact of the restraining order, Moseneke found, "is to invade the heartland of the national treasury function and force the hand of Parliament's budgetary role" – another trespass on the separation of powers.
According to Finance Minister Pravin Gordhan, in submissions to the Constitutional Court, the delay in implementing tolling had already cost R2.7-million, 40% of Sanral's estimated 2012 revenue. Sanral's average monthly expenditure on the Gauteng Freeway Improvement Project amounted to R601-million for this financial year, and without tolling, the amount would have to be paid by national treasury, Gordhan had submitted.
The court also considered other financial consequences, including a two-notch downgrade in Sanral's credit rating by Moody's that was apparently linked to the interdict being granted. Also, that Parliament would have to appropriate more money from the national treasury to reduce Sanral's debt exposure. The legislature has already approved a special appropriation of R5.75-billion to reduce the impact of tolls on Gauteng's roads, which was used to defray Sanral's operational expenditure, interest payments and other toll-related expenditure.
Moseneke noted the "harm and inconvenience" to motorists was the result of a "national executive decision" about how public funds were to be spent, "over which the executive government disposes and for which it, and it alone, has the public responsibility".
"Thus the duty of determining how public resources are to be drawn upon and re-ordered lies in the heartland of executive function and domain. What is more, absent of any proof of unlawfulness or fraud or corruption, the power and the prerogative to formulate and implement policy on how to finance public projects reside in the exclusive domain of the national executive subject to the budgetary appropriations by Parliament," Moseneke found.
The judgment further considered that "the collection and ordering of public resources inevitably calls for policy-laden and polycentric decision making. Courts are not always well suited to make decisions of that order."