Cadre deployment takes toll at PRASA

…article dated 28 February 2021….

CEO says sorting out the mess…

In a meeting of the Transport Portfolio Committee, Minister of Transport, Fikile Mbalula, addressed MPs together with senior members of PRASA’s new management team and told them that whillst PRASA seemed well on-track with infrastructure upgrades, the state entity was only now tackling the issue of lack of passenger services.

The Minister went into some detail on latest developments, particularly on the restoration of the central line in Cape Town and the Tshwane Mabopane Corridor.

Get moving

At the end of the meeting and unconvinced that PRASA was acting speedily enought, MPs challenged the Minister’s statement that the new PRASA management team was in a state of “recovery”.  Some sort of “kick start” was needed if the lacklustre results of the last twelve months were anything to go by, they said.

The purpose of the meeting was for PRASA to report back on the Auditor General’s highly critical findings on the entity’s 2019/20 annual report which had been outstanding for one year.

PRASA subsequently appeared before the Standing Committee on Public Accounts (SCOPA) where it was similarlyroasted for failing to bring its accounts into order after three years of inertia and following such incidents as the fraudulent Swifambo locomotive train deals, genrerally poor management practices  as reported by the AG and a general “failure to carry the torch of commuter transport in SA”, to quote the AG’s office in an earlier meeting.


The  Transport Committee was told that the mother city’s central line that links townships Kyalitsha, Langa and Philippi with the City Centre, which was not totally secured.    Meanwhile, in Gauteng, the Mabopane commuter links and rail infrastructure to this township of some 840,00 residents remained inoperable in terms of the same pattern of destruction.

Said Minister Mbalula, “Transnet’s rail system continues in general to be a target of theft, vandalism, and senseless attacks on PRASA employees and private security while on duty.”   Both these two ines, together with stations, signalling and infrastructure, have been rendered unusable for the last three years, he said.

Counter attack

He told MPs that an improvement in operational performance was the immediate overall task; and following this were modernisation programmes.  The priorities being tackled at present were fencing, signalling, station upgrades and security interventions across all 17 main rail corridors in SA, coupled with effective consequence management procedures and the support of investigations by SIU that are currently underway.

The Minister introduced Thandeka Mabija, currently acting CEO, who asked parliamentarians to note that the PRASA group audit was only concluded at the end of September 2020  which has been PRASA’s fault.  Consequently much of the work of new staff appointed was in the current financial year and not in the year under review . This should be taken into consideration, she said.


She acknowledged the AG’s disclaimer on the report, which had noted instability, poor financial management and record keeping; lack of compliance, monitoring and enforcement; lack of consequence management; no audit findings action plan and a vacuum in senior management.

Ms Mabija said the AG’s comment regarding inadequate oversight and vacancies in key positions had now been addressed with 17 top positions having been filled. There now remained two key positions, that of Group CEO and the Group Chief Financial Officer and applications for these posts were before Parliament.


On her appointment she had agreed with the new management and also with her board, that nothing could be done about a turnaround in PRASA without the right staff.   This had been the priority in the first few months of her tenure, she said.

Amongst other priorities for PRASA for the remainder of 20/21 financial year after her appointment had been the implementation of a security and asset protection plan; the merger of the PRASA Cress and Intersite property companies; the restructuring of Autopax, as the intercity bus company; a resolution of the locomotive acquisitions from Stadler Rail, the company who took over Vossloh through Swifambo (the “too high” diesel long-haul locomotives -ed); a complete overhaul of the rolling stock situation; and the re-establishment of rail line “corridors” back into public service.

As advised, the President’s call for the roll-out of the central line in Cape Town and the Mabopane to Pretoria line in Gauteng was a priority and this was currently being tackled.

Lack of controls

Ms Mabija said  that one of the first tasks of the new PRASA board of control was to appoint a finance committee since matters at PRASA were exacerbated by the fact that the group had no credible fixed asset register nor any accounting watchdog or control system whatsoever.

MPs asked how the balance sheet could have possibly been drawn up without a list of capital assets.   Ms Mabija replied that the register was hopelessly outdated and had never been attended to, so one of the immediate tasks therefore had been to audit all property and assets and establish a baseline. This had taken time, she said.


Also, she said, a system KPI’s (key performance indicators) was introduced which in turn had identified a total lack of detection and cross-referencing in the accounts, notably an inability to detect where variances occurred in the accounting systems. The main problem was that mostly staff had not been trained into the posts they held, nor given the parameters of what was expected of them, she said.

Staff training, she said, was now taking place in terms of the requirements of the Public Finance Management Act (PFMA) across all aspects of the PRASA business.    Staff costs had been identified as the main material cost driver which reached 52% of entire costs of operation. This was now recognised as not correct. Also, being put in place was a programme for all clerical staff on basic document management.

On lack of accounting security, an SIU unit had been engaged to assist on 4 of the 17 “material irregularity cases” identified in the audit, with findings to be with the AG by the end of March 2021.

Poor controls

Krishna Govender, acting CFO, told MPs that overall group revenue had progressed slowly from R14bn in 2018/19 to R16.2bn billion for 2019/20, with group expenditure decreasing from R16.1bn to R14 bn. This was far from satisfactory, she noted.

She also found that the list of 187 unsatisfactory audit findings in the 2018/19 report had been unattended to.  75%of these had now been addressed but only recently. 19% were still in progress and 6% outstanding.

The list for 2019/20 was now being started but this was found to be  difficult because records were in poor shape.   Ms Govender also said Prasa had ro report in total irregular expenditure to the tune of R1.2bn.

Breaking the rules

It was noted that “irregular expenditure” was at R3bn the previous year, Ms Govender said, and for 2019/20 it was less at R1.3 bn – ” which is still far too high, but now with the recently installed ability to track supply chain management issues this should bring a telling decline”, she said.

Added to this was the recent imposition of consequence management and which should have a marked effect on procedures and decision making, she hoped.

Tough stance

Ms Govender said that the AG had been insistent that employees faced consequence management rulings immediately and such should be backdated also for the 2019/20 financial year.

As a result, in terms of  actual results, the number of employees facing “serious transgressions and outcomes” were so far 10, with six having been already being dismissed.  From the current year figures of 2020/21, a further 17 are undergoing investigation, of which eight employees have been dismissed on the evidence gathered.”

The AG had also complained that findings going back to 2016 had not yet been addressed. Ms Govender explained that all findings, old and new, are  being addressed by the special investigative internal audit committee recently formed to specifically look into historical audit matters.

Money thrown away

On processes being put in place to mitigate vandalism, PRASA officials said a start had been made by revising asset management processes, working with the rebuilt national asset register.   In order to fast track the strengthening of the security function and to get “boots on the ground”, staff had been reallocated and and basic security patrolling has been re-

War zone

The committe was told that a ministerial instruction had been received that PRASA must source drones and armoured vehicles which are now in the pipeline for purchase during the current financial year with Integrated control rooms being added as soon as funds became available.

On rolling stock and other assets, the main factor affecting revenue performance was the question of locomotives and train sets in order to become more operational, Ms Govender said.  Six Stadler locomotives were already in the country and the board was about to record that a further 22 locomotives were yet to come. “By adding  the Gibela locomotive trainsets manufactured in Pretoria, the planned combination of diesel and dual locomotives originally estimated for is to be achieved”, she said.

Molefe mess

On top of this, MPs were told, Transnet had said they would replace the electrified train sets burnt in the last few years and that they are to receive additional train sets from Gibela within six months for theirt metro lines.  Overhead track equipment, designed as an adaption for Gibela by engineering  experts at the University of Stellenbosch for the “too tall” trains, are shortly to delivered, PRASA officials told the Committee.

For all trains and locomotives new engineering standards and routine procedures have to be established for regular maintenance and workshops re-designed.

Question hour

During a long question time, it emerged that seven locomotives of the Stadler were sold on auction that week for the value of R95m.   Liquidation and winding down was being applied as the process was still in progress. A draft commercial agreement enabling PRASA to access the remaining locomotives from Transnet was in process.

To date significant progress has been made, MPs were told by Transnet legal representatives, and the total value of the matters under investigation has been quantified at around over R7bn.  On this, amongst other outcomes reached by Transnet legal officers, is the likely criminal referral of four persons in senior positions.

Summing up

Lack of clarity on the issue of locomotives; where they now were; what had been earned from any sales; how many would be eventually commissioned, was queried by MPs and a whole number of questions on train sets and haulage locomotives generally withg MPs demanding to know more. It was a fluid issue with Transnet in control de facto so that answers were not immediately available to PRASA.

Transnet vs Prasa

This resulted in PRASA Chairman, Leonard Ramatlakane, stating in conclusion that an urgent report to Parliament would be made on the whole situation regarding locomotives in the next few days, “which would further indicate that PRASA were at end of a long chain of events with Transnet as the supplier, all making planning at PRASA difficult.”

The report would clarify the final Transnet decisions being currently made on the routes on which the locomotives were meant to operate. It must be noted, he said, that most of the decisions involved Transnet, the owners of the locos, who passed instructions to the operators, PRASA.

Crippled services

On the issue of fighting vandalism, MPs were told that “iprogrammes by PRASA have resulted in 3,100 persons being recruited and 1,000 already been deployed to various areas.”

In conclusion, PRASA staff said, “PRASA is cognisant that this is not enough to cover all stations, buildings and infrastructure but now an integrated security strategy, which speaks to a combination of technologies, cameras and alert systems, is to be deployed for which an additional budget has been sought and agreed to.



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