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- Prasa told Parliament that it would prioritize consequence management over employees who allow unnecessary deviations in spending.
- Prasa President Leonard Ramatlakane said all critical vacancies would be filled by people with the required skills.
- The former executives won their court offer to have the termination of their contracts declared illegal.
South Africa’s Passenger Rail Agency told Parliament on Tuesday that the entity’s previous leaders were behind a cascade of public spending diversions, which the current leadership is now tasked with cleaning up as they work to bring the rail agency back. to be in shape.
Prasa has undergone a series of leadership changes in recent weeks, including the appointment of former member of Parliament of the African National Congress Leonard Ramatlakane as president of the entity.
The entity is also embroiled in a battle with former executives whose contract termination Prasa announced in January and February.
However, former COO Nkosinathi Khena, former risk and compliance executive Onica Ngoye and former Autopax CEO Tiro Holele managed to appeal the termination of their contracts in Labor Court on Tuesday.
Prasa said in a statement issued Tuesday afternoon that they would appeal the ruling and produce documents on Wednesday. This battle could complicate the job of the current leaders as they hope to fill the vacancies at Prasa.
Reporting to Parliament’s Standing Committee on Public Accounts, Ramatlakane said he had studied the findings of the Special Investigation Unit’s reports on the agency’s requests to deviate from public spending guidelines when acquiring goods and services.
“The deadline for the special investigation is February 28, but they need until March 15 to consolidate the issues. After the SIU’s submission to SCOPA, there was an omission that Prasa will recover R26 million,” Ramatlakane said. .
Ramatlakane said the permanent appointment of Prasa CEO Zolani Matthews would go a long way in giving the agency the ability to function at optimal levels as the leadership sought to get to the bottom of past absenteeism expenses.
“We are working hard to find a CEO of the group. That has happened and the Cabinet finalized that appointment and the announcement was made on Saturday. We are now formalizing the difficult tasks that need to be done so that the CEO can begin to function,” said Ramatlakane. .
Why does Prasa deviate
Prasa group procurement director Willie Mathebula said that for various programs, many of the bidding processes were not completed due to the pandemic. He said Prasa was planning a series of tenders to secure bidders for the modernization and rehabilitation programs.
“The Southern African Development Bank was appointed as the executing agent for the capital program, with a contract value of 5.4 billion rand. This was for the rehabilitation of the railway network and modernization. We were urged to go through a competitive bidding process, “said Mathebula.
Mathebula told SCOPA that in most of the deviation requests where the National Treasury did not approve the deviations, Prasa did not go ahead with that deviation or its spending.
“Prasa sought a diversion for surplus rolling stock raw materials with a single source supplied by Transnet for a contract value of R280 million. The diversion was initially approved, but after the Treasury requested more information, R40 million was spent Ultimately, it was not endorsed by the National Treasury, but for some reason Prasa went ahead.
“Prasa implemented this project before requesting diversion from the National Treasury. Consequence management is in progress,” Mathebula said.
Mathebula said that in another tender, which was awarded to Premifield, services were provided, but the deviation was pursued to maintain the program until the project is fully realized.
“In the lease of locomotives for main line passenger services and for a period of six months for a contract value of 66 million rand, Prasa needed to finalize the bidding process and obtained the conditional support of the National Treasury provided that the bidding off fast track, “he said. saying.
He said that in the station modernization program in Isipingo, Molemo Consultants, Nkambule & Associates, Iliso Consultants and Development Engineering Consultants were named. Expenditures had already been incurred when the diversion request was submitted to the National Treasury. Five officials have been suspended pending the SIU investigation, Mathebula said.
“A panel for R $ 75 million was appointed. After the expense was incurred, they approached the National Treasury in search of a deviation. The Treasury noted that the expense had already been incurred and instructed Prasa to request a remission and the process involves an investigation to find out who is responsible, and that is what the SIU has been working on, “he said.
Prasa also had a project to repair sumps for R24 million, along with improving drainage and sump mitigation works at and near the Centurion station. Mathebula said a diversion was sought because Tiro Civils would take fewer days to complete the outstanding work.
Prasa did not proceed with the project because the Treasury did not approve it and an open bidding process is being implemented.
Conflict?
SCOPA president and Inkatha Freedom Party deputy Mkhuleko Hlengwa disagreed with the lack of clarity in some of Prasa’s diversion requests to the National Treasury.
“The rejection of the request for a deviation from the National Treasury and compliance with Prasa does not mean that the request has not been made. We want to understand why Prasa requested the deviation in the first place when the law is clear,” Hlengwa said. .
Hlengwa also pointed out to Mathebula that he was in the National Treasury Office of the Chief Procurement Officer, which meant he was familiar with many of the spending deviations he was trying to explain to Parliament, likening the situation to “trying to catch a javelin you threw. “
“There is a potential conflict of interest that arises when you present us with these deviations and commitments from Prasa to the National Treasury, given that you were seconded to join Prasa from the Treasury in the Office of the Director of Procurement. This is not necessarily personal,” he said. Hlengwa.
Fill seats
SCOPA member and deputy of the African National Congress, Bheki Hadebe, asked Ramatlakane if all the key positions identified by the Auditor General’s office in Prasa’s annual report had been filled at the board level.
Ramatlakane said: “We hope that by the new year we will complete our structural review and fill the positions. We also want relevant skills in the position and not just warm bodies. We would like to finalize the CEO appointment before the end of next week.”
Alf Lees, a member of SCOPA and a deputy for the Democratic Alliance, said that the failure to update Parliament or act on the investigations already concluded on financial management smelled of a lack of urgency.
Lees asked what measures had been taken against officials and employees that were unable to prevent diversions and inappropriate spending.
Ramatlakane said that some officials responsible for this left the agency’s employment, but that the board would ensure accountability for those still working at Prasa.
Crazy for locomotive
On the curious ongoing locomotive acquisition case in Prasa, board member Matodzi Mukhuba said that the agency acquired 13 locomotives from Stadler.
Mukhuba said some of the locomotives are still in Spain so it can be checked if they still need modifications before they can be delivered to South Africa.
Board member Fana Ramutla said 17 locomotives were originally purchased and the R2.6 billion paid went to Swifambo. The liquidators auction the locomotive.
“The proposed commercial agreement is R1.1 billion, which is the 23 locomotives manufactured and 13 delivered to South Africa, with two years of maintenance, training in Spain and SA by Stadler and additional maintenance for another two years,” he said. Ramutla.
Fight in labor court
Meanwhile, the Johannesburg Labor Court handed down a ruling Tuesday declaring the termination of the employment of Khena, Ngoye and Holele. Prasa issued a statement Tuesday afternoon saying it would appeal the ruling.
