**2. Literature review**

#### **2.1 Defining tolling**

Tolling is a charge one incurs for using a facility availed for public usage. The most popular format is a charge for utilising a road or a part thereof, known as a per-use fee. For a very long time the charges were based on the tare or the number of axels on a vehicle plus the length of the stretch of the road used. Lately, in some projects the charges differ depending on the time of the day. The revenue thus collected is ploughed back into the project for expansion, for the operation and the maintenance of the facility as well [12]. Norway for instance has 48 tolling roads in operation which generate a lot of income for the rollout of future projects, as they generate about 25–30% of the total national road construction budget. Tolling has been very successful in Norway for over 50 years [13]. Experiences in Norway, France and other countries are a testament that success is rooted in widespread meaningful public consultation.

There is a variant to the traditional approach to tolling which involves varying the charges depending on the demand. This approach has other names like value pricing, peak-period pricing, congestion pricing or market-based pricing. This approach parrots the pricing of airline tickets, cell phone calls billing and electricity usage charges. Congestion charging not only is a source of income, but demand is managed as non-essential trips could be postponed when the rates are low thus easing the unnecessary gridlocks. The market forces can thus be harnessed to lessen time wastage, reduction of unnecessary toxic emissions and avoidance of accidents [12].

#### **2.2 Urban tolling in other countries**


non-essential travel. The options for levying charges range from time specific charging to the size of vehicle used. The levies could be done each time the vehicle passes or aggregated within 24-hour period. Since 2003 London has adopted a 24-hour approach where a set figure is charged within an identified zone in central London. Several concessions do exist including a 90% discount for residents [12].

4.**Priced Road Networks**: A selected number of lanes is priced. Although a first of its kind in the world, it has been in operation in Singapore in the mornings since 1975. The system transitioned to full automation in 1988 and it brings in about US\$70 million for the city whilst operation costs are only 7% of that. Entering the CBD also attracts another area pricing charge during the weekdays [12].

The SANRAL submissions in all forums where they defend their approach do not show any awareness of these alternatives or how far they were explored and compared against each other. The public consultation should have been based on these tried and tested alternatives and their potential adaptability to the South African socio-economic climate. The next section will deal with the issue of Public Consultation.

#### **2.3 Public consultation**

The International Association for Public Participation (IAPP) regards public participation as the co-opting of the views of the general populace in formulating the final decision on matters that affect them. When the participation is meaningful the decisions are sustainable [14]. The public participation could be strategize to include workshops, public meetings, open houses, surveys, citizen's advisory committees, polling and any acceptable public engagements (ibid.).

Many a time there is focus on technical performance of the infrastructure whilst ignoring a plethora of other considerations that enhance the project performance. The local communities as the ultimate consumers must be regarded as the main consideration before implementation. The clients' welfare should top the list of considerations, the day-to-day managers of the facility, the design and maintenance teams, the construction team and suppliers. Each decision by one group will almost inevitably affect others higher up in the development pyramid. The easiest way to keep the popular kickback due to resistance is to have an all-encompassing involvement. Burroghs [15] posits that despite the sometimes negative media influence, the general populace deploy common sense when given full information. Although the public is the ultimate fanancier of the project through taxes and user-fees, however, they are often not taken seriously especially when there is no binding legislation to do so in a jurisdiction [16]. Some commentators on this issue are clear that consultation sometimes forces transparency on the projects especially around cost which might work against the project if it is too high. Opaqueness is used strategically for selfish purposes to ensure buy-in from decision-makers. This has resulted in a bad reputation of the construction industry where megaprojects in particular are characterised by runaway costs [15].

Consultation by definition a two-way process of dialogue between the project company and its stakeholders. The interaction should be implemented from the start and sustained throughout tenure of the project as a way to get a 'social licence to operate' from the general populace [17]. Smith [18] clarifies that "public participation" involves a slew of processes meant to involve and educate the people so that they can have a meaningful input. Rowe and Frewer [19] reemphasizes that "input" is the key word, as this shows that there is an intention to hear the other

#### *South African E-Toll Consultation SAGA: Corporate Governance Lessons for Public… DOI: http://dx.doi.org/10.5772/intechopen.103054*

side. Consultation should be grounded in a neo-institutionalist perspective that focuses on intrinsic firm's regulations and rules touching the city's management when it comes to consultation and popular involvement fashion [20]. The emerging interventions including citizens focus groups in different forms encourage lively interactions in a democratic dispensation to reach all-inclusive decisions [21].

The IFC [17] suggests that a good plan is critical before starting the initiative, as that will help identify key stakeholders and issues vexing them about the development. A Stakeholder Engagement Plan is indispensable where there are a number of stakeholders with diverse concerns and issues. It is one thing to listen to people but although that is encouraged, there must be firm assurances that their input will somehow be incorporated (ibid.). The implementation plan for consultation should be communicated well. It will appear from many complaints from the members of the public that perhaps the simplest principles of public consultation for a project of the GFIP magnitude were not properly followed.

After surveying 25 countries the OECD came to the conclusion that governance impediments are besetting the consultation throughout the life cycle of the project. Most countries in the study do not have an overarching strategy but have sectoralized the implementation of the initiatives. Due to their nature infrastructure projects are susceptible to corruption, capture and abuse throughout their lifetime [22]. Although most countries are aware of this weakness they are slow in coming up with robust integrity fostering instruments. Even where they exist there is in some jurisdictions notable political interference in prioritising projects and who to consult. A very poor consultation could even frustrate the implementation of an otherwise good project. Consultation is common and concentrated in the preparation phase, but it is less common in cementing an overall vision or assessing needs. The consultation process according to the OECD [22] should be consumerate to the project magnitude and its wider public impact mindful of the concerns of the key stakeholders. The process of consultation should be broad-based, designed to elicit dialogue and be piggybacked on the public access to information and users' needs. The new technological advancement make consultation easy as there is no need to be in one place [23]. Any communication aimed at the general populace should be conducted early to have any impact. If people are not aware of the from an early stage, they may feel that their sentiments have deliberately been overlooked when it matters the most and the consultation is simply an afterthought or a tickbox exercise without any meaningful substance. When the general public is alienated this increases the number of objections resulting in costly delays and other complications. It is imperative with large projects that all options are laid on the table as the emotions are likely to run high in local communities.

This research was inspired by an earlier study conducted by Leromanachou et al. [13] and it also took lessons from the study taken by OECD [22] in 25 countries to see the lessons that can be drawn by a developing democracy like South Africa, which is a middle income country with a fledging consultation framework.

#### **2.4 Corporate governance**

The essence of corporate governance encapsulates the day to day operational functioning of a business. Van Wyk and Chege [24] are among authors who have decried the lackadaisical approach in the construction industry vis-à-vis other economic sectors. Corporate governance upholds the sacrosanct business principles of fairness, accountability and transparency [25]. The crux of the matter here is to assess whether there was fairness and transparency in the implementation of this scheme in Gauteng. What is at issue is whether the Gauteng government was fair and transparent in implementing the E-toll project in Johannesburg. If for

something reason they could have been wanting in this regard, then corporate governance principles were not adhered to.

Since corporate governance provides a framework for achieving objectives, it encapsulates invariably every aspect of the organisation business. This invariably involve the action plans, including inside controls up to how performance is measured and corporate disclosure [11]. This means that governance should include ethical behaviour, corporate strategy, compensation and risk management (ditto). At the heart of corporate governance (CG) is the agency problem, where there is a separation of ownership and control [26]. The SANRAL agency was supposed to be representing the government, but if there is poor corporate governance the idealistic government's aspirations might not have been carried through.

The Gauteng E-toll project is the biggest project of its kind and it is implemented in an environment where megaprojects are relatively a new phenomenon in South Africa. That said it means some elements of megaprojects were manifested when it came to corporate governance issues. Due to the uniqueness of each individual project (Gauteng e-toll project being the first in South Africa) and the complexity of navigating the different expectations the project was from the get go a risky undertaking [27, 28]. Secondly megaprojects are multilevel structures where a balance has to be struck between conflicting interest at every stage [29]. The third point is that the utilisation of mega-money creates a fertile ground for all manner of unethical and exploitative behaviours [30, 31]. Fourthly megaprojects are a fertile ground for what are called black swans events. These are events that are so unexpected in a particular context, but which events are triggered by the sheer complexity of the project [32]. Biesenthal [27] argues that the multiplicity of stakeholders, the complexity of projects and the exploitative tendencies of some players lead to information being withheld or wrong information disseminated. Especially when it comes to issues of scope, risks, objectives, costs and schedule. These challenges are exacerbated by social, political and cultural challenges. According to Flyvbjerg ([33], p. 6) all this means that megaprojects should not be treated as "magnified versions of smaller projects" but as different projects with different demands, problems, power dynamics and structures.

#### **3. Research methodology**

The study wished to garner the awareness together with the amenability of the citizenry to the GFIP's tolling and given this problem a mixed method qualitative was the preferable route. The end-users were critical in providing the necessary insights. To this end researchers were sent to strategic catchment places like shopping malls to conduct a survey of the motorists' sentiments. The questionnaires were also deployed extensively to deal with the quantitative dimension of the strategy, thus making the overarching approach a mixed method. Officials from various organisations were also interviewed to provide some depth in understanding the problem in its totality. Maxwell [34] argues that implementing a qualitative approach is not a copy and paste job. For the qualitative approach to be implemented properly one needs to be iterative as one navigates different components of the design, as the different parts inform and impact one another. Qualitative approach has no definite starting point and does not move linearly through a series of steps, rather it relies on the dynamism of the situation and the components introduced to deal with it [34]. So the design is inspired by the environment and reacts to it. The following methods were regarded as the most suitable. The thematic content analysis advocated by Burnard [35] was adopted for this study. This in turn is inspired by Glase and Strauss's [36] Grounded Theory and other approaches utilising content analysis used by the likes of Berg [37]. *South African E-Toll Consultation SAGA: Corporate Governance Lessons for Public… DOI: http://dx.doi.org/10.5772/intechopen.103054*

In order to ensure validity members of the team not involved with the actual interviewing of respondents were tasked with the reading of the transcripts, coding and categorising of the themes [35].

It is a requirement for any research to get clearance here at the University of the Witwatersrand and this was complied with. The key stakeholders vehemently resisting the GFIP tolling were interviewed first. These were COSATU, a trade union representing the working masses and OUTA members. It was easy to identify the individuals from these organisation as they have been vociferous in the media, and they were more than willing to cooperate. Unfortunately, the agency involved was not ready to cooperate, as there were juristic disputations underway. Their public stance was that they did what needed to be done and they complied fully with the regulation. What was deemed important here was the depth and breadth of the data and this called for an active role in data collection [38]. To achieve this insight, individuals were interviewed who had studied the project documents, challenged its legitimacy through juristic disputations, mobilised the citizenry to resist complying with its precepts by instigating mass protests and mass media agitations. Frey and Oishi [39] define an interview as an interaction between two parties that is intended to illicit information on a topic of interest. Following Nichols [40] take on this, if the researcher wants to go open-ended they make the conversation to be as informal as possible by not even coming with a list of questions so that there is a natural flow in the interaction. Thus this study went for open-ended interviews because the researcher can thrust deep into the topic by submitting follow-up questions to get more information [38]. These in-depth follow-up enhance the quality of data thus gathered.

One thousand and eight hundred respondents participated at the three shopping malls in Gauteng. The malls were identified due to their wide catchment areas, popularity and size. Motorists were engaged with in the parking lots as they alighted their vehicles. Not all respondents filled all the questions, they skipped those they were not comfortable in fielding. Questionnaires are known as a formal list of questions used to elicit information from a sample group. What the researcher wants to know he/she converts into a set of questions that could be responded to by willing respondents. Questionnaires are generally used as a main tool for the collection of primary quantitative data [41]. The main benefit of a questionnaire is that data collected is standardised and thus making it consistent and easy to analyse. It could actually be regarded as a standard text interview dealing with all the subjects [42]. Whereas with other methods like interviews the same response could be put in different ways, with questionnaires there is simplicity and succinctness. This simplicity enhances analysis. What was really the focus of the enquiry was how early the citizenry were made aware of the project and to gauge their overriding sentiment toward e-tolling. The SurveyMonkey software package proved useful in providing a rounded analysis as it can enable a plethora of linkages. The SurveyMonkey was used to upload the data manually once the physical forms were completed by respondents.

The research's methodological inclination was largely inspired by Leromanachou et al. [13] in understanding tolling in Norway where respondents included the public company dealing with infrastructure and leaders at the local level.

#### **4. Results and discussion**

Below are some of the excerpts from the interviews with the leading protagonists against e-tolling. These assisted in eliciting themes that came out strongly during the deliberations.

#### **4.1 Lack of transparency**

**Respondent one***: when preparing the start of a project of this size you have to carry everyone along. With the GFIP during the early days, robust engagement should have been had with all the stakeholders. The two issues that needed discussion were to ensure that the public understands that the infrastructure needs improvement and also the methods available for financing this development. On both fronts there was a serious dereliction by the authorities. During the build-up to the world cup there were many projects that were intended to upgrade infrastructure and enhance the successful hosting. The GFIP was largely regarded as a legacy project.*

It is clear from the response that the project hid behind the world cup hype and was not distinctly marketed as a stand-alone development requiring public financing through e-tolling. This shallow consultation led the public to make wrong conclusions about the scheme. Had the authorities been transparent the debate would have revolved around the most appropriate financing model for the project.

*SANRAl was very conservative in sharing information on financing the project especially during the build-up to the world cup. SANRAL has always known their preferred financing model from the onset and they should have taken everyone on-board from the get go.*

It is clear from the above different available methods of financing this project were never divulged to the general populace.

#### **4.2 Poor planning**

Tolling success is by law justifiable if there are alternave routes nearby. In a case such as this where those are already grid-locked with traffic it appears as if people are forced to use the tolled road.

There was no attempt to improve the alternative routes to make them veritable options. So the state is accused of compelling motorists to use the tolled route out of necessity.

#### **4.3 State's profligacy**

*How exactly does the state manage infrastructure implementation? In as much as it is known that the funds are scarce but there is a lot of wastage in the system, the curbing of which could improve the provision.*

Some subjects/respondents like the one quoted above were knowledgeable on state's management of resources. The mentioning of wastage in the system clearly showed that in some quarters tolling is regarded as unnecessary as improving the stewardship of public funds could make funding straightforward.

#### **4.4 Lack of transparency**

**Respondent number two:** *planning behemothic schemes like this one which are supported by public tolling requires consultation and consent from the populace, because this is some form of taxation. Since e-tolling is not manual where only payers could be allowed to proceed, willingness and buy-in are very crucial in ensuring compliance. Laws are generally as good as they are administrable. So putting one in place where enforceability is not guaranteed is a futile exercise. This ambitious project is implemented in a climate of utter mistrust against the government, where there is also grinding poverty among the masses. The rampant non-compliance thus introduced will lead to the upright citizens just subsidising the flouters.*

*South African E-Toll Consultation SAGA: Corporate Governance Lessons for Public… DOI: http://dx.doi.org/10.5772/intechopen.103054*

This response is in concert with the one before in that it advocates for implementing public consultation before anything else. The issue of lack of trust between the state and the people came up as a result of the repressive past in South Africa. What heightens the mistrust is if consultation comes very late in the project's implementation process. Low compliance creates a situation where the compliant members of the public are actually subsidising the rest.

*Here is the question I would to pose to SANRAL: is this an extra tax? There should be very strict laws governing levying the public on anything, before a thoroughgoingly robust consultation process. Otherwise, the agitation thus instigated could lead to a mass disobedience.*

There are societies and people acting independently inviting the government to arrest them as they are not willing to pay for the e-tolling. The legal fraternity has jumped into the bandwagon with at least one firm prepared to provide a pro bono service to anyone arrested for defiance. Although the issue has not been tested in the courts the mass resistance is a clear and present danger. It is 2021 now, not a single case of non-compliance has been brought before the courts.

#### **4.5 Poor planning**

*In the Western Cape a similar project was tried early in 2000s but all the stakeholders, poured cold water on the initiative. This project, which was supposed to run along the garden route, was ultimately abandoned.*

Since proper protocols were implemented it is surprising why the same was not done here. If it was not acceptable in a second largest city in the country, lessons could have been learned and the consultation could have been more intensive, more transparent and more prolonged to allow the proper exchange of ideas.

#### **4.6 Malicious compliance**

*What was done in Johannesburg was the opposite of what was attempted before. One advert was placed in six papers in 2007 October. Just that one advert is all they did. The advert did not elaborate on the methodology of implementation, pricing or any other information that could elicit an objection or further enquiry. As a result, only 28 submissions were made one of which was a petition with 34 signatures. To make things worse they claim they received 85 responses… I do not care even if it was 185, we are talking about 2.5 million motorists here overall. Now with those appalling numbers they moved on convincing themselves that they did all they had to do. It was a classic tick-box exercise.*

The dissemination of information about the impending development was very handicapped and the general populace was not afforded the chance to ruminate over the legitimacy of the scheme and its funding methods. Choosing six papers that do not have the widest circulation and again placing the adverts in awkward sections without much publicity was not going to attract a lot of input it appears. The respondent further divulged this information just shared.

*The legislation stipulates that during consultation the net has to be cast as wide as possible and a minimum 30 days has to be afforded the public for their responses. The law allows the authorities to go up to 60 or 90 days in consulting the stakeholders. Considering that the project is the biggest of its kind in the world, and also that this is the African economic hub where the roads were free to use all along, that level of consultation is shockingly poor. All the critical stakeholders including haulage companies, vehicle rental sector, the disabled community and the AA were not in the loop from the onset. The inputs and opinions of these organisations is very crucial.*

The very poor stakeholder analysis and identification led to a very stiff resistance from civil organisations like OUTA, as this development was disadvantageous to their businesses. It appears SANRAL did the barest minimum required which appeared not to have been adequate given the size of the project and its importance not only to the province, but regionally as well. Gauteng is the economic hub of the sub-continent beyond the frontiers of South Africa.

Below are the responses to some of the questions pertinent to public consultations that were contained in a questionnaire distributed to Gauteng residents (**Figures 1** and **2**).


**Figure 1.** *Public responses from the survey.*

**Figure 2.** *Public responses from the survey.*

*South African E-Toll Consultation SAGA: Corporate Governance Lessons for Public… DOI: http://dx.doi.org/10.5772/intechopen.103054*

**Figure 3.** *Public responses from the survey.*

#### **Figure 4.**

*Public responses from the survey.*

