71 percent increase in vehicle licensing transaction fees must be explained

On 6 October 2017, Transport Minister Joe Maswanganyi published the increased transaction fee which will be charged on eNaTIS vehicle licensing transactions applicable with effect from 1 February 2018, in Government Gazette 41170. The transaction fee is charged, over and above the actual vehicle licensing fee which goes to the registering authority, and is payable to the Road Traffic Management Corporation.

The increase of R30 per transaction equates to a whopping 71.43% increase in this transaction fee, raising it from R42 per transaction to R72 per transaction. In the previous year, the former Minister of Transport, Dipuo Peters increased this transaction fee from R36 to R42 per transaction, an increase of 16.67%.

The current reported inflation rate in South Africa is 4.8% as at August 2017 and therefore, the latest published transaction fee exceeds the current inflation rate by almost fifteen times.

According to its annual report, the RTMC managed to rake in R453,143,790 in transactions fees in the 2016/17 financial year, an increase of R33,299,526.00 or 7.93% over the 2015/16 financial year, despite fewer transactions having apparently occurred in the last financial year.

At the same time, the remuneration package of the CEO of the RTMC increased by 31.6% from R5,950,000 in 2015/16 to an enormous R7,830,000 in the 2016/17 financial year. Other executive senior management remuneration packages at the RTMC increased by an average of 19.11% whilst non-executive Board members’ remuneration packages increased by an average of 22.16%. Simultaneously, the RTMC’s employee-related costs came to R367,107,340 in 2016/17.

The recent termination of the RTMC’s contract with Tasima, which contact was unlawfully renewed by former Minister S’bu Ndebele in 2010, should have had the effect of decreasing the input and maintenance costs of the eNaTIS vehicle and driver registry and therefore, beyond increasing the outrageously high remuneration packages which are paid to RTMC executives and Board members, there appears to be no rational reason for the truly massive increase in transaction fees the Minister has proclaimed.

This is more especially true given the fact that the vehicle population is growing with each year that goes by. Between 30 September 2016 and 30 September 2017, the registered vehicle population grew by 211,816, a figure which is consistent with the trends of vehicle registrations which have taken place in recent years. As at 30 September 2017, there were 12,153,062 vehicles registered on eNaTIS, all of which must be licensed annually, regardless of whether they are used on public roads or not.

JPSA calls on Minister Maswanganyi to justify, or at the very least explain the whopping increase in transaction fees he has proclaimed, especially in light of the fact that the RTMC has consistently failed to achieve its mandate with respect to enhancing road safety and reducing the catastrophically high carnage which exists on South Africa’s roads.