SANRAL Charged To Account For R10bn Overpriced Construction Costs For GFIP


The Organisation Undoing Tax Abuse (OUTA) has regarded as an insult to the people of South Africa, the South African National Roads Agency’ (SANRAL)’s statement that it is only claiming up to R760m in civil damages against construction firms over the costing of the 2010 Soccer World Cup highway upgrades as well as roads in other provinces.

Outa stated this in response to Sanral’s media briefing on Monday that collusive construction companies will only be charged for up to R760 million‚ and that not all of this pertains to the Gauteng Freeway Improvement Project.

OUTA regarded the statement as “insufficient and a slap in the face of the people of South Africa‚” as stated by  OUTA’s chairman‚ Wayne Duvenhage.

“It took SANRAL nearly three years to come up with this minuscule calculation and it is vague and lacking in detail‚” Duvenhage added

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Outa went on to state that Sanral has to make a public explanation of the extent of it’s civil claims to the Gauteng Freeway Improvement Project (GFIP) and what other projects they were referring to and how much on each of these did the civil claims apply to.

“One supplier was responsible for 74% of the claims due” Duvenhage added.

Earlier this year, Outa revealed that the GFIP was overpriced by a whopping sum of 321% when compared to road construction pricing systems around the world. The organization maintained that there are a number of international benchmark studies from which Sanral can glean a good understanding of where they rank in road construction costs.

Outa’s Duvenage then said their findings proved that the South African public has been “grossly overcharged” for the Gauteng Freeway upgrade by an average of 321% from 2008 to 2011.

“This research and position paper tells us that there is something grossly wrong with the cost of road construction under Sanral’s watch,”

Outa, therefore, called on the Minister of Transport to acknowledge that such high costing is a problem for the public. “The public require absolute transparency and far more details on this matter than SANRAL is providing,bench-marking” he said

“As much as SANRAL would like to ignore the question‚ this adjustment makes little difference to the estimated R10 billion to R11 billion overpriced construction costs for GFIP.

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The organization’s leader charged SANRAl to give an answer on whether the public received fair value for the GFIP at R17.9 billion (less the few hundred million of their civil claims due to be recovered)

“SANRAL recently attempted to downplay OUTA’s research on the GFIP benchmarkingpaper‚ but they got their millions mixed up with billions and tried to pin their misreading of a case study report on OUTA‚ when in actual fact they merely embarrassed themselves‚” Duvenage charged.