PRASA update on investigations and the implementation of corrective measures; with Minister and Deputy Minister

Meeting report

The Acting Chairperson welcomed everyone present and said the Committee was meeting the Passenger Rail Agency of South Africa (Prasa) to follow up on matters of accountability. He acknowledged its lows, but also appreciated the recent efforts to recapture the railway system countrywide, which had collapsed. Things had fallen apart, but there was an indication of progress. Members had recently toured the central line on 20 April and seen how Prasa captured the rail. Prasa promised on the day that by the end of May, the recapturing would be completed, especially at Philippi. However, it had been the same story.

He appealed to Prasa, remembering the work done by Mr Loyiso Nkohla, an activist who was recently shot dead, to expedite its work and keep its word.

Minister’s overview
 
Ms Sindi Chikunga, Minister of Transport, said Prasa had been invited to present its progress in implementing corrective measures. The organisation had been in the news for the wrong reasons, but the board had put mechanisms and plans in place in response to the corporate plan approved by the Minister to drive Prasa forward. It was on an upward trail in terms of performance.

In December last year, Prasa presented its annual report, indicating a dismal 19% performance, but it was now reporting a performance of 59%. This improvement could be attributed to the increased number of corridors that had been recovered, stations built, and reintroduced lines. Prasa was now operating about 19 lines, 13 of which were operating new trains.

The remaining challenge was the ability to repair the signalling system, without which Prasa could not address the frequency of trains. The focus of the plans for the year was to fix the signalling system to run more trains, especially during peak hours. Work had commenced in Gauteng and Cape Town to implement the signalling programme. Prasa had been strictly instructed to focus on this project.

This required that the "war room" be sustained and capacitated further. Prasa had also been able to spend its capital budget, which it had exceeded by 8% -- R13.9 billion versus its R12.6 allocation.

The safety permits had not been extended. The Regulator permits were valid until August 2025. This confirmed Prasa’s improved efforts. On 20 May, Prasa would launch a safety campaign. Security had improved significantly, and asset-related crimes had gone down. The biggest challenge, however, was to sustain the current deployment beyond the infrastructure programme. This had come at a huge cost, and Prasa needed more money for security operations. This would also be allocated to modernise the security technology in the security infrastructure.

There had been an investment in capacity and skills. Critical positions like the Group Chief Executive Officer (GCEO), Chief: Human Capital, Group Company Secretary, Chief Audit Executive and Regional Manager: Gauteng, had been filled. However, the ministry was concerned about the suspensions that were taking forever, and Prasa had been instructed to finalise them as soon as possible.

Operation Ziveze (Ghost Employees Project) was another project that Prasa was embarking on, and Members would be updated on the progress of this project. She concluded that by the end of this board’s term in October, it would have created an environment from which Prasa would not regress.

Mr B Hadebe (ANC) commented that he was expecting apologies for the board’s absence.

The Minister said the board chairperson had indicated he might arrive late for the meeting. Members would be aware of the issues regarding the board currently being processed. The ministry had written to the chairperson regarding the issues pertaining to him, and he had been given seven working days to respond, and the last day was today. He was expected to write back.

The Acting Chairperson reiterated that he might be late, and he was expected to respond to the ministry’s letter regarding what had been in the public domain.

PRASA acting chairperson's comments

Prasa's acting chairperson said that the entity's board was committed to ensuring that the governance prescripts continued to work, and that effective controls were implemented. Prasa had improved its audit findings. Material irregularities had been identified at inception, but these have since been reduced by 50%. They continued to address the remaining irregularities, and the biggest one pertained to the conditional assessment of the assets. Service providers had been engaged to ensure the asset register was properly reflected in the system. Part of the improvement plan was to ensure that the audit opinion improved from a disclaimer to a qualified audit opinion, as previously indicated. The board had ensured that its oversight role was properly engaged, which was evidenced by the performance of 59%.

Prasa continued to reopen corridors, and the board had recently conducted oversight on the Centurion line, and testing would be taking place this week. The board had also ensured that Prasa spent its capital budget, which had been extended.

The critical positions had also been filled, as indicated by the Minister. The board would closely monitor the positions in the purview of the CEO to ensure that the process was followed thoroughly.

PRASA update on investigations and corrective measures

Mr Hishaam Emeran, Group CEO, Prasa, assured Members of the commitment of the executive and the board on the urgency to recover and rebuild Prasa. The determination and commitment of the team were reflected in the work that had been achieved so far, although there was still a lot of work to be done.  

The Head of Prasa security said that Prasa was training its own personnel as drone operators. It currently had "eyes in the sky" to protect its assets. The security plan had provided significant progress, and there had been a decrease in vandalism of over 75%. There was a hands-on approach to fighting crime and protecting its assets. Prasa had to deal with the construction mafia in Cape Town, KwaZulu-Natal, and Gauteng.

Funding was still a significant challenge in the protection services. Within the next three years, Prasa would deploy technologies and reduce the number of personnel over time as it implemented the early warning management systems via the C4I project.

One of the projects developed was called Project Bhekela in an effort to clear the railway lines, but what was unfortunate was that Prasa was not in the business of relocations. However, it had started implementing the project. Five months ago, one would not have been able to see any of the rails. Prasa had worked with the communities to shift the shacks interfering with its infrastructure. There were now approximately 800 shacks on the track from Nyanga towards Philippi. Prasa had identified land on Stock Road, and by the end of May, it would have completed the removal of the 800 shacks, and would have the contractors starting to build on that infrastructure next month. This was the project that the late Loyiso Nkohla had been passionately assisting Prasa on.

The Acting Chief Procurement Officer said the opening balance of the irregular expenditure in April 2022 had stood at R30.49 billion, and in the last financial year, it was recorded at R428 million. On 31 March 2023, the balance was R30.9 billion. The condonation that was awaiting approval amounted to R12.350 billion. The condonations that were subject to determination tests were sitting at R9.6 billion, and an amount of R8.9 billion was currently being addressed by various business units to finalise the condonation submissions and the supporting documentation. 

[See the presentation for details]

The Committee's Acting Chairperson welcomed the presentation, but said he was concerned that Prasa was failing to meet the basic prescripts of legislation that governed it as it rendered services to the nation.

Special Investigating Unit (SIU) briefing

Mr Mike Koya, acting on behalf of Adv Andy Mothibi, Head of the SIU, took Members through the presentation, which covered the SIU's investigation, the details behind the proclamation, challenges and limitations, a summary of the outcomes, motivation for a new proclamation, as well as the agreed focus areas on lifestyle audits.

[See the presentation for details]

The Acting Chairperson commented that Prasa had had too many issues involving security. The Committee had noted the irregularities highlighted by the Auditor-General of South Africa (AGSA), and measures had been taken to address some of them.

Discussion

Mr A Lees (DA) welcomed the progress, and said he had visited the central line a few weeks ago. The services were still limited, and there were persisting issues. The opened corridors were still on a limited service. The issue, like the sand that blows onto the line regularly, closing the line between Simonstown and Fish Hoek, needed to be dealt with to keep even the limited services going.

He wanted to know if the new signalling system would use satellite and wireless technology to avoid thefts; if the issue of the new French trains that were too wide for the platforms, requiring the modification of platforms, was being dealt with, and how; what the 15 000 Prasa employees were doing and had been doing for the past three to four years, and if they were still painting stations as badly as they had in Mopopane, and if this was part of the recapitalisation funding requirement; if Prasa would lease the trains that it had already paid for, as they were needed; and what the chances of settling the commercial agreement were, and the trains being modified and usable.

As for Autopax, Prasa was in court with other operators. Why was Prasa not letting this go when there was absolutely no need for it in the market? It was wasteful at a time when it needed taxpayer bailouts.

Mr Emeran agreed with Mr Lees on the issue of the limited services needing to be resolved, and for there to be higher frequency services. The sand problem was dealt with through a joint project between Prasa and the City of Cape Town involving beach reclamation and dune shifting. This project was due for completion in July, but there were already positive results. In Simonstown, a wall was preventing some of the sand. It had collapsed over time, but had been rebuilt in December last year. Prasa had appointed a maintenance contractor between Simonstown and Muizenberg to deal with challenges on the tracks and the issue of the sand. Hopefully, going forward, the issue of the sand would be resolved. There was a bigger discussion on the issue of climate change around the coastal line.

Prasa was considering a modernised signalling system. The programme that was rolled out in 2013/14 was moving away from the mechanised signalling system to electronic systems. Through that process, Prasa implemented an anti-theft and vandalism methodology. It was not able to remove all the cables that deal with signalling, but it had been minimised. New work had been affected by theft and vandalism. Prasa was moving from electronic to in-cab signalling, to reduce theft and vandalism. These projects would be rolled out, and some of these matters could not be done overnight. It was now considering rolling out an electronic authorisation system to replace the manual one. Currently, if anything happens to the signalling system, they revert to manual, which results in limited services and higher risks to operating trains. The electronic signalling system was being rolled out with the objective of running trains at a higher frequency.

The platform rectification had been in the pipeline for a long time. Prasa had decided to have short, medium and long-term solutions, which included redoing the tracks at high-volume stations. It had developed an interim solution to address the risk associated with passengers boarding the trains. On some platforms, there were mobile ramps for vulnerable passengers to assist in the interim to address the platform challenges. A lot more work still needed to be done on the rolling out of the programme and the utilisation of staff during the time when services were limited.

There was a dire need for locomotives at Prasa, especially diesel ones, because of the infrastructure that had been badly vandalised. Theft and vandalism impacted the network right through to the Eastern Cape. Services had been suspended since August last year because of the theft and vandalism of the electric infrastructure, and Prasa did not have any diesel locomotives there. It managed to reintroduce the service in April by recovering some of diesel locomotives, but there may be reliability issues with those locomotives. It had managed to recover the East London/Berlin service, and now the team was trying to recover some locomotives to send to Gqeberha to bring the service back there. Prasa was engaging closely with Transnet to recover the lines and address the issue of the availability of locomotives.

Payments had been made in the past for the leasing of the locomotives. Prasa did not own the locomotives, and they were with the liquidator, but Prasa was now trying to extract the best value out of the process, based on the R2 billion already spent. The previous process of auctioning them had resulted in some going "for a steal." Locomotives valued between R40 to R50 million each had been auctioned off for between R6 and R8 million, and there was no value that Prasa was going to get out of the process. The commercial agreement was still being pursued, and the advice was to depart from a procurement process, and Prasa was busy with a Section 79 application. In the interim, if Prasa went out to lease, it would end up paying more, whereas through this process, it would pay only for running costs.

Regarding Autopax, those companies were operating at a sustainable level and Prasa's objective was to bring Autopax back to run sustainably. The importance of Autopax was affordability for long-distance travel by bus for South Africans. There had been a significant increase in bus prices in the absence of Autopax. There was a strategic need to regulate that market by having Autopax actively participate in that space.

Mr Lees asked for a follow-up on the Transnet locomotives.

Mr Emeran replied that one of the impediments had been the outstanding debt existing between Prasa and Transnet. By the end of March, that debt had been settled through an offset arrangement of money owed. For the balance, it was proposed that Treasury move some of the capital allocations to operating expenditure (Opex) to settle some of Prasa’s debt. There had been an improvement in terms of cooperation, as there was urgency in allowing Prasa to access locomotives.

Ms B van Minnen (DA) referred to the 75% reduction in crime and theft, and asked over what time period this had taken place; if there had been any improvements on trains running on the tracks, as what she saw in Gauteng had been worrying; the historical high number of Prasa’s users compared to the current user number, and the target it wished to achieve and over what time period. She said the relocation process was not simple because there was certainly not enough land in Cape Town. How was Prasa improving its systems to ensure this matter did not persist?

Prasa's Head of Security responded that the analysis done on theft and vandalism in the last 24 months had shown that these incidents were sitting at about 5 000 per annum, but this had decreased to below 900 and still decreasing. On prevention measures, Prasa was running its operations nationally with law enforcement, and encroachment was not ongoing. No additional shacks were being built in the areas where there was control. Prasa drives and runs operations with law enforcement every week to deal with new encroachments or attempted ones.

Mr Emeran said that the tracks were measured in terms of the track quality index (TQI), and in many cases, it was below the standard at which it should be. It was one of the key challenges that resulted in Prasa having to run trains at a reduced speed because of the quality of the track. It had now been able to procure on-track machines, and they had been implemented in some of the corridors. Secondly, Prasa was now out on a national tender for new rail, and 1 300 km of the new track would be procured. A recent contract had just been concluded for 150 km of new track in some key areas. Other projects were also underway.

Regarding passenger numbers, at its peak, Prasa was sitting with close to 600 million passengers per annum. In 2014/15, with the modernisation programme, Prasa had wanted to exceed that. The number had dropped to 15 million passengers. At its peak, it was running between 40 and 44 corridors of lines across the country. Currently, there are 18 to19 corridors, and this year it would be recovering more. It was only after the signalling system had been restored that it could start running a full service. Currently, it was running at an hour or 90-minute frequencies in some corridors. The new signalling would give Prasa the capability to run trains every three to five minutes at peak times. This was the objective and the targets had been set going into the next medium term expenditure framework (MTEF) period. The next two to three years would reflect a slower uptake of the numbers, but after implementing the new system, the numbers were expected to recover to a minimum of where Prasa had been before.

Ms A Beukes (ANC) noted the improvement and the appointment of women in senior positions. The impact of Prasa protection services has led to a reduction in theft and vandalism. Had Prasa evaluated the reasons why there was still vandalism and theft in some areas? Did it have any awareness programmes in and around the communities to encourage them to take ownership?

She was concerned about the timeframes for the conclusion of investigations. Most of the suspensions were with full pay. As the SIU had reported, the new evidence had delayed the process, but where was this evidence coming from and why was it coming in only now?

The critical vacancies that remained unfilled had a critical impact. Regarding the nature of the misconduct, she thought it would be progressive to report on the outcome of the investigations regarding certain employees. She asked if there had been any progress with these cases.

Most cases raised by the AGSA involved non-compliance, inadequate monitoring and inability to enforce contractual remedies, but what measures were being put in place to mitigate this? What had led to the irregular expenditure of R400 million, and what were the plans to address this? Did Prasa have the internal capacity to implement those plans? What was the relationship between the board and the senior officials?

Regarding the 2022/23 submission, Prasa had trained 4 944 employees against a target of 2 010 -- had "ghost workers" been trained?

Mr Emeran said that theft and crime was not a Prasa issue, but a societal issue, although Prasa was addressing and putting interventions in place to mitigate this. The reality was that if there was no sustainable plan involving the inclusion of the communities, Prasa would not get far.

There was a constructive relationship between the board and management, which could be seen in the progress made in the last period.

The Head of Security said the main approach was that the integrated security plan focused on the communities and the small, medium and micro enterprises (SMMEs) around the infrastructure. Through the security deployment, Prasa worked with sub-councils within the various areas, and over 4 200 direct jobs had been created in the security services. This was not about protecting assets, but integrating Prasa with the communities. Theft and vandalism would become less once Prasa had fully implemented its walling and fencing. There were still vigilante groups that cut lines to limit Prasa's services, and more destructive attacks were faced currently.

Regarding the update on Employee One, they have been found guilty of all charges and the matter is now awaiting the chairperson meeting to present mitigating matters on this case.

The Chief Procurement Officer (CPO) broke down the R428 million in irregular expenditure, and said that R160 million referred to the prior irregular expenditure. The difference was the contracts that were multi-year projects. The current year’s irregular expenditure stemmed from the legal panel expenditure, the leasing agreement on locomotives, and smaller non-compliance with Construction Industry Development Board (CIBD) regulations.

Prasa said the training referred to had been for Prasa employees, and the highest proportion was employees from Gauteng, at about 800 employees.

Mr Kuyo said the people coming with new evidence would be the employees that were being charged. In their defence, they would introduce new evidence, consequently delaying the process.

Ms C Mkhonto (EFF) observed that according to the Prasa presentation, the focus was on short distances in and around the urban areas. This may be due to the number of people using the service, but were all these activities also going to be rolled out for long distance routes so that people in rural areas could also benefit? Secondly, she asked about the verdicts of employees found guilty of misconduct, pointing out there was a verdict classified as ‘early retirement,’ and she was concerned that it may excuse people from accountability.

She said the Minister had indicated earlier that she was thrilled that Prasa had received a performance achievement of 59%, but she was concerned that the expenditure was sitting at 100%. With 100% expenditure, Members were expecting to see a correlation.

She said the reason state-owned entities (SOEs) approached Treasury for funding was that they did not have maintenance plans to maintain what had been recovered and built. To avoid going around in circles, was there a maintenance plan for all the good interventions presented?

According to the presentation, Prasa was going to provide the relevant infrastructure and technology vehicles. In the end, there would be a tender for private security that would utilise all the infrastructure and the resources that were going to be provided by Prasa. She did not understand how they were going to gain from that. Had Prasa considered having its own internal security function?  

The DG had talked about operational funding support. This went back to the maintenance, and how Prasa planned to sustain itself. Operations had to be funded and in the long run, how was Prasa going to sustain itself?

Mr Emeran replied to the long-distance plans, and said Prasa may have overemphasised the Metrorail recovery. Prasa runs only two long-distance services now -- Johannesburg to East London and Johannesburg to Musina. The main reasons for that were the availability of locomotives and its dependence on Transnet in terms of the condition of the network and access to it. There was a plan for the availability of locomotives and expansion of the long-distance network. With long-distance rail, there would be a need for recapitalisation and modernisation.

There was a lot more that could be done on the Metrorail, but the issue of the long-distance services was not fully finalised. The current fleet had reached the end of its lifetime. To be progressive in this space, they had to talk about hydro locomotives, diesel, and electric multi-unit trains to run, and this was in the future. In the short term, it was all about getting the locomotives and the network availability from Transnet. The plans could be shared with the Committee.

On the correlation between performance and budget expenditure, some of the investments had a longer turnaround time in terms of the effect of the expenditure. Some of the targets in the corporate plan were not necessarily linked to purely capital expenditure. Certainly, it had been a notable achievement for Prasa to be able to execute its capital allocation.

Regarding the maintenance plan, the plans were in place for both fleets of trains. There were contracts in place for the current fleet. A technical maintenance support panel had been established to assist with the maintenance of trains. All recovery and rebuilt programmes had a maintenance plan. They had seen a significant increase in capital allocation – R12.6 billion for the previous financial year, and about R40 billion over the MTEF. A significant increase in the commitment to capital allocation was evident, but not for operational funding. Maintenance of some of the programmes would require increased funding allocation for operations.

The Head of Security said that the security space was extremely labour-intensive. If Prasa had to in-source a security complement, in terms of shifts, it would have to have a force of about 30 000, Whereas a hybrid model would provide the same protection with 10 000 personnel on the ground. Phase one of the security plan involved physical deployments, while phase two would start phasing out warm bodies, which meant Prasa would do the same job with 5 000 people.

A Prasa official said that the investigations formed part of a report of what could happen at the end of the hearing. It was not about the employee adjudication responsibility -- employees would be pursued through law enforcement agencies if found guilty.

Responding to the question of maintenance, an official said that Prasa had brought in On-Track Machine Services. They were packages that were currently in the evaluation stage. The machines were yellow, and would be on the railway lines. The limited service was not running at normal speed, and the plan was to improve the TQI to the level where it could run the trains at normal speed. To achieve this, Prasa needed to first ensure that the physical infrastructure on the ground was maintained to a level where the trains could run safely. Members may have seen that many of Prasa’s lines were water-logged, and it was not safe for the trains, so it was addressing the issue of drainage as well around the network. The maintenance plan had been shared with the rail safety regulator (RSR) to monitor what was being done on the ground.

Ms Mkhonto was not pleased that the security personnel needed to be outsourced. Having a hybrid system was not an issue, but why was Prasa going to tender for security services?

The Acting Chairperson reiterated that Ms Mkhonto was not pleased with the outsourcing, although Prasa indicated that it was moving away from too many warm bodies to being reliant on technology. He welcomed the point by Prasa.

Mr Hadebe asked the board whether it had conducted due diligence on the appointment of the GCEO, and whether Members would not be faced with the challenges of finding another person due to vetting issues. Was there a project plan for appointing other executives, when the vacancies would be filled, and how many were there? Treasury had not condoned the R12.3 billion irregular expenditure, and Prasa had not given the reasons for the non-approval of those deviations. Was Prasa going to rely only on Sections 5.7 and 5.8 of the Public Finance Management Act (PFMA) to remove the expenditures that were not condoned, or would it pursue Section 3.2 (C) to recover the money from those responsible? What became the status of the long term contracts when they were declared irregular by the AGSA -- did they remain valid? When would the internal audit conclude the determination test on the R9.6 billion awaiting condonation? How many corridors could be expected to be delivered in this current financial year? Had Prasa worked with law enforcement agencies to identify and arrest the construction mafias?

The Acting Chairperson stepped in and indicated that Mr Hadebe had lost a close friend, Mr Nkohla, through this construction mafia incident. Prasa’s pace on the matter was too slow. The fact that Prasa had recovered but was doing very little was not inspiring confidence. Lives were being lost because of these issues and the quicker something was done, the better.

Mr Hadebe said that Nkohla was his close friend indeed, and he was really interested in what the huge success referred to in dealing with the construction mafia was. He asked what compensation had been made to the rest of the team, as some were still fighting for their lives. These were private citizens that continued to assist Prasa in its endeavours to recover. These community leaders had voluntarily committed their services to ensure that Prasa fulfilled its mandate. Was the City and the Housing Development Agency (HDA) assisting in ensuring that people were moved, and had any challenges been experienced in working with these two entities?

The Acting Chairperson said that they had visited the communities and seen what it took to work with the communities. When Members asked Prasa these questions, they often stemmed from a place of very painful realities that were taking place on the ground, and some of these outcomes were unbearable. Members wanted to see a sense of speed on matters of this nature.

Mr Emeran acknowledged that Prasa had lost a huge ally who had been assisting tremendously in making progress with the central line. It was something that must be accelerated, and the corridor brought back as soon as possible.

Management would share a project plan around the filling of executive vacancies. There had been discussions with the remuneration committees (REMCOs) on accelerating these interventions. Once these discussions had been concluded, the timeframes would be shared with the Committee.

Prasa had recently appointed a co-sourced partner within the internal audit department to assist with capacity.

Prasa was targeting a minimum of ten further corridors to be recovered. It was working on this, as well as optimising the existing corridors. The breakdown for Gauteng, KwaZulu-Natal (KZN) and the Western Cape would be provided. The corridor to the Strand, Stellenbosch and Eerste Rivier must also be brought back. There were a few corridors in Gauteng. There was a plan detailing by when these recoveries would be achieved which would be shared with the Committee. People like the late Mr Nkohla were helping Prasa to continue doing work on the corridor. If the Philippi section was not opened, it would not get through to Kaapteinsklip (Mitchells Plein) and Chris Hani (Khayelitsha and beyond).

Prasa was working with communities on Operation Bhekela, and it had hit home from a human point of view, and was getting that central line corridor working. Operation Bhekela was an interim intervention, and if there was no finality on the long-term solution of relocation, they were even bringing into question the objective of Operation Bhekela. Recently there had been communication around the funding of the new site, but Prasa was ready to move with the contractors into the area to undertake the rail infrastructure, which had to be rebuilt. Contractors had been appointed for the electrical overhead infrastructure. Until the relocation plan and its long-term solution was finalised, there was still a risk to this programme.

The Head of Security said he and Mr Nkohla had worked together to formulate a plan for the central line. He had been part of all the meetings, and he had given him a call on the Sunday to cancel the Monday meeting. They dealt daily with risks and the threats were real, and on that fatal day he had lost his life doing his work. It was through his involvement and that of other community leaders that the plan had been formulated. On the central line alone, over 1 800 people had gained access to work. Unfortunately, Prasa could not do this without protection services, and it was pushing for more assistance. SAPS could do much more.

The investigation was at the advanced stage. The people had been identified and the tracking was underway. He had no doubt that the people would be apprehended. A vigilante group wanted to disrupt what Prasa was doing and what the communities were trying to achieve. The long-term plan for relocation was a critical point, and the City of Cape Town and the HDA needed to come on board, because the communities were asking about it. The killing of Mr Nkohla had been high profile. Last night, another community member had been killed within the same area, and these were targeted attacks. Prasa was pleading with the SAPS to resource its personnel for railway policing.

The CPO head said the general overhaul contracts had been submitted to the National Prosecuting Authority (NPA) because there was corrupt and collusive behaviour. One contract for heavy maintenance had no corruption and collusive behaviour. These contracts were extended initially for three years, and then for a further five years. This compromised Section 217, in terms of fairness and equitability. Prasa had derived benefits from the general overhaul contracts, but the engagement with Treasury had not yielded the intended results.

Of the R9 billion irregular expenditure to be condoned, R2.2 billion was related to contracts that were filtered through during the last three financial years. Prasa had gone out on tender to appoint a legal panel.

In the last three years, there was one security contract, and the major portion of the irregular expenditure was related to the signalling system. These contracts were irregular, but not unlawful. There had been breakdowns in control, which was internal, but there was no corrupt or collusive behaviour.  

PRASA's acting chairperson replied that the board had conducted its due diligence on the appointment of the GCEO. He was not new at Prasa, and had been with the entity for 18 to 20 years. He had a permanent contract with Prasa through his initial appointment. The board was confident that when the State Security Agency (SSA) came with a top-secret vetting, it would not encounter the same matter as before. The board was very confident in him, so he was awarded the opportunity to lead the organisation. The board had conducted its due diligence, and the internal vetting had come out positive. The board had not yet received feedback on the top-secret vetting.

Concluding remarks

The Acting Chairperson said he would have asked about the privatised engineering procurement approach indicated by the GCEO, and at what point Prasa would be out of that bondage. It would require some internal capacity to be built by the organisation. However, some questions would have to be parked due to time constraints and the House sitting at 14h00.

He acknowledged the work done so far. Judge Hlophe’s judgment sat at the core of what they see today at Prasa. The main objective of Prasa was to ensure that railway commuters were provided with transport both within and from the Republic, and to provide long-haul passenger rail and bus services within, to and from the Republic, in accordance with the principles set out in the National Land Transport Act of 2000.

Minister Chikunga appreciated the engagement with the Members, and the acknowledgement of Prasa's progress. The most frustrating issue on the central line was that the Constitution gives powers and functions to different spheres of government. In the case of housing, this function was shared between the National Department of Human Settlements and the provincial department. The issue around Bhekela was an indication of frustration by Prasa, because this had not happened. Prasa was now faced with getting involved with mandates that were not its own.

Ms Van Minnen had said there was no land in Cape Town, and that was the core issue here. The metro had initially said it had no finances, but the national Department of Human Settlements had transferred R111 million to the provincial department to ensure that this project was executed. The money was received in March this year, but they had said that they would not be able to spend the money because they were approaching their financial year end, in June. This money had been with the provincial department since March. The ministry pleaded to the Committee to assist the metro in utilising these funds. People were waiting and were willing to relocate. The role of providing security to the railway was costly – this was infrastructure that cut across the country, including trains, train stations and other buildings. Whether Prasa was using technology or warm bodies, it was expensive and it required money to protect these assets.

The Prasa board must fill all the vacant positions and appoint capable people. The SIU briefed the ministry on the work it was doing at Prasa, and was supported fully by the ministry.

The meeting was adjourned.