UNIVERSITY OF SOUTH AFRICA (UNISA)
College of Economic and Management Sciences
⋄
TRL3702 ASSIGNMENT 02
Semester 1, 2026
⋄
Module Code: TRL3702
Module Name: Transport Economics
Student Name: [Insert Your Name]
Student Number: [Insert Student Number]
Assignment No.: 02
Due Date: [Insert Due Date]
Semester: Semester 1, 2026
Unique Number: [Insert Unique Number]
Submitted in partial fulfilment of the requirements for TRL3702: Transport Economics
at the University of South Africa.
,UNISA | TRL3702 Transport Economics – Assignment 2
Question 1.1: Structure, Management, and Funding of South Africa’s National Road Net-
work
South Africa’s national road network is the arterial backbone of the country’s economy, con-
necting major cities, ports, mining regions, and border posts across all nine provinces. The
network is managed by the South African National Roads Agency SOC Ltd (SANRAL), a public
entity created under the South African National Roads Agency Limited and National Roads
Act 7 of 1998 (SANRAL Act) to plan, design, construct, operate, rehabilitate, and maintain the
country’s national roads (SANRAL, 2024a). The network totals approximately 22,000 kilo-
metres of national roads, though SANRAL’s responsibilities have expanded considerably in
recent years as provincial governments have transferred underperforming road networks to
the agency.
1.1.1 Institutional Structure and Legal Framework
SANRAL is a state-owned company whose sole shareholder is the South African government,
represented by the Minister of Transport (SANRAL, 2024a). The agency is governed by an
eight-member Board of Directors, of which five are voting members appointed by the Minister
for three-year terms, and two are non-voting officials from the Department of Transport and
the National Treasury respectively. This governance structure was designed to ensure that
SANRAL operates with both commercial discipline and public accountability, functioning as
an engineering-driven state entity rather than a purely commercial firm (Government of South
Africa, 2013).
SANRAL’s network is divided into two structurally separate portfolios: the toll portfolio and the
non-toll portfolio. The non-toll portfolio accounts for approximately 84 to 87 percent of the
total network by length and is funded through annual government grants transferred from the
national fiscus via the Department of Transport (Government of South Africa, 2013). The toll
portfolio constitutes the remaining 13 to 16 percent of the network and is funded through a
combination of toll revenue and borrowings on capital markets.
Within the toll portfolio, there are two sub-categories. First, SANRAL directly owns and oper-
ates certain toll roads, collecting revenue from plazas to service bond debt and fund mainte-
nance. These include the Tsitsikamma Toll Road (N2), the N2 KwaZulu-Natal coastal tolls, the
Mariannhill Toll Road (N3), and segments of the N1 in Gauteng, the Free State, and Limpopo
(SANRAL, 2024a). Second, several toll roads are operated under public-private partnership
Page 1 of 20
, UNISA | TRL3702 Transport Economics – Assignment 2
SANRAL
National Road Network
Non-Toll Portfolio Toll Portfolio
(84% of network) (16% of network)
Funded by SANRAL SANRAL-operated PPP concession
govt grants direct mgmt toll roads toll roads
Figure 1: SANRAL national road network portfolio structure
(PPP) concessions, where private companies raise capital, construct and maintain the roads,
and collect toll revenue over a concession period, after which the roads are handed back
to SANRAL in a specified condition. Key concession roads include the N3 Toll Concession
(N3TC, operated by N3 Toll Concession (Pty) Ltd between Johannesburg and Durban), Trans-
African Concessions (TRAC) on the N4 Maputo Corridor, and Bakwena on the Platinum High-
way (SANRAL, 2024a).
1.1.2 The Funding Model: Toll versus Non-Toll Financing
The dual funding model generates very different financial dynamics for the two portfolios.
The non-toll portfolio receives an annual government grant, which in 2018/19 amounted to
R12.4 billion, though a significant portion of this grant was diverted to the toll portfolio to
offset the GFIP debt service shortfall, reducing available spending on non-toll maintenance
and development (Stop-Over, 2019).
Table 1: Comparison: Toll vs Non-Toll Road Funding Models
Dimension Non-Toll Roads (84%) Toll Roads (16%)
Primary Funding Annual government fiscal grant Toll revenue; capital market
bonds
Secondary Funding Ad hoc transfers from toll portfo- National Treasury grants (GFIP
lio post-2022)
Management SANRAL direct SANRAL direct or PPP conces-
sion
Oversight Dept of Transport; Auditor- SANRAL; Ports Regulator; Capi-
General tal markets
Risk Bearer State (taxpayer) Toll user; bond investors
Maintenance Short- R75 billion backlog (2024) Ongoing GFIP debt of R29 billion
fall
Page 2 of 20
College of Economic and Management Sciences
⋄
TRL3702 ASSIGNMENT 02
Semester 1, 2026
⋄
Module Code: TRL3702
Module Name: Transport Economics
Student Name: [Insert Your Name]
Student Number: [Insert Student Number]
Assignment No.: 02
Due Date: [Insert Due Date]
Semester: Semester 1, 2026
Unique Number: [Insert Unique Number]
Submitted in partial fulfilment of the requirements for TRL3702: Transport Economics
at the University of South Africa.
,UNISA | TRL3702 Transport Economics – Assignment 2
Question 1.1: Structure, Management, and Funding of South Africa’s National Road Net-
work
South Africa’s national road network is the arterial backbone of the country’s economy, con-
necting major cities, ports, mining regions, and border posts across all nine provinces. The
network is managed by the South African National Roads Agency SOC Ltd (SANRAL), a public
entity created under the South African National Roads Agency Limited and National Roads
Act 7 of 1998 (SANRAL Act) to plan, design, construct, operate, rehabilitate, and maintain the
country’s national roads (SANRAL, 2024a). The network totals approximately 22,000 kilo-
metres of national roads, though SANRAL’s responsibilities have expanded considerably in
recent years as provincial governments have transferred underperforming road networks to
the agency.
1.1.1 Institutional Structure and Legal Framework
SANRAL is a state-owned company whose sole shareholder is the South African government,
represented by the Minister of Transport (SANRAL, 2024a). The agency is governed by an
eight-member Board of Directors, of which five are voting members appointed by the Minister
for three-year terms, and two are non-voting officials from the Department of Transport and
the National Treasury respectively. This governance structure was designed to ensure that
SANRAL operates with both commercial discipline and public accountability, functioning as
an engineering-driven state entity rather than a purely commercial firm (Government of South
Africa, 2013).
SANRAL’s network is divided into two structurally separate portfolios: the toll portfolio and the
non-toll portfolio. The non-toll portfolio accounts for approximately 84 to 87 percent of the
total network by length and is funded through annual government grants transferred from the
national fiscus via the Department of Transport (Government of South Africa, 2013). The toll
portfolio constitutes the remaining 13 to 16 percent of the network and is funded through a
combination of toll revenue and borrowings on capital markets.
Within the toll portfolio, there are two sub-categories. First, SANRAL directly owns and oper-
ates certain toll roads, collecting revenue from plazas to service bond debt and fund mainte-
nance. These include the Tsitsikamma Toll Road (N2), the N2 KwaZulu-Natal coastal tolls, the
Mariannhill Toll Road (N3), and segments of the N1 in Gauteng, the Free State, and Limpopo
(SANRAL, 2024a). Second, several toll roads are operated under public-private partnership
Page 1 of 20
, UNISA | TRL3702 Transport Economics – Assignment 2
SANRAL
National Road Network
Non-Toll Portfolio Toll Portfolio
(84% of network) (16% of network)
Funded by SANRAL SANRAL-operated PPP concession
govt grants direct mgmt toll roads toll roads
Figure 1: SANRAL national road network portfolio structure
(PPP) concessions, where private companies raise capital, construct and maintain the roads,
and collect toll revenue over a concession period, after which the roads are handed back
to SANRAL in a specified condition. Key concession roads include the N3 Toll Concession
(N3TC, operated by N3 Toll Concession (Pty) Ltd between Johannesburg and Durban), Trans-
African Concessions (TRAC) on the N4 Maputo Corridor, and Bakwena on the Platinum High-
way (SANRAL, 2024a).
1.1.2 The Funding Model: Toll versus Non-Toll Financing
The dual funding model generates very different financial dynamics for the two portfolios.
The non-toll portfolio receives an annual government grant, which in 2018/19 amounted to
R12.4 billion, though a significant portion of this grant was diverted to the toll portfolio to
offset the GFIP debt service shortfall, reducing available spending on non-toll maintenance
and development (Stop-Over, 2019).
Table 1: Comparison: Toll vs Non-Toll Road Funding Models
Dimension Non-Toll Roads (84%) Toll Roads (16%)
Primary Funding Annual government fiscal grant Toll revenue; capital market
bonds
Secondary Funding Ad hoc transfers from toll portfo- National Treasury grants (GFIP
lio post-2022)
Management SANRAL direct SANRAL direct or PPP conces-
sion
Oversight Dept of Transport; Auditor- SANRAL; Ports Regulator; Capi-
General tal markets
Risk Bearer State (taxpayer) Toll user; bond investors
Maintenance Short- R75 billion backlog (2024) Ongoing GFIP debt of R29 billion
fall
Page 2 of 20
