National Chairman of the Justice Project, Howard Dembovsky, said motorists would be expected to pay up to 71 percent more in transaction fees when completing vehicle licensing in 2018.
Dembovsky said the increase to R72 per transaction was stunning, when one considers the previous increase was a mere 16 per cent.
The spotlight has fallen squarely on the new Minister of Transport Joe Maswanganyi, who took over from Dipuo Peters, following President Jacob Zuma’s controversial Cabinet reshuffle earlier this year.
The new transactional fee is expected to be implemented from February 1, 2018.
“The current reported inflation rate in South Africa is 4.8 percent, as at August 2017 and therefore, the latest published transaction fee exceeds the current inflation rate by almost fifteen times,” said Dembovsky.
The transactional fee is money that makes its way to the Road Traffic Management Corporation (RTMC). Dembovsky explained that it stood to make a significant killing from the upcoming increase.
“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 percent over the 2015/16 financial year, despite fewer transactions having apparently occurred in the last financial year,” explained Dembovsky.
“At the same time, the remuneration package of the CEO of the RTMC increased by 31.6 percent 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 percent whilst non-executive Board members’ remuneration packages increased by an average of 22.16 percent. 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.”