Prasa: Montana paid R4 million for four months and presiding over R4 billion in irregular expenditure 

3 October 2016

Passenger Rail Agency of South Africa’s (Prasa) 2015/16 annual report revealed a whopping R4.1 billion in irregular expenditure as well as R9.8 billion identified during the period under review relating to previous years. The Auditor-General  (A-G) noted that effective steps were not taken to prevent this as required by section 51(1)(b)(ii) of the PFMA.

With individuals such as former CEO, Mr Lucky Montana, being paid out a salary of R3.9 million for the rest of his contract after being fired in July 2015, it is no surprise that Prasa has wasted billions unnecessarily. On top of this Mr Montana received other remunerations to the tune of R458 000 for three and a half months of work. This inexplicably overshadows Acting CEO, Mr Khena’s salary of R1.6 million from July 2015 to March 2016.

The report also  reported vast corruption within Prasa with the Hawks investigating 39 reported cases of corruption as well as National Treasury currently investigating 100 contracts in accordance with remedial action from the Public Protector’s report entitled Derailed.

Worst of all is that Mainline Passengers per annum dropped from 1 538 000 in 2010/11 to 660 000 in 2015/16 which means Prasa can ill-afford to waste money and it is even more ludicrous that they would pay inflated salaries to its Executives.

The following are some further egregious findings from the annual report:

- Negative customer satisfaction surveys due to unreliable train service performance.

- There was a halt in purchasing new locomotives due to legal action around the contract.

- Train incidents increased from 2.4 passenger injuries and fatalities in 2014/15 to 4.71 in 2015/16.

- Achieved only 18 out of 44 annual targets or 41%.

- Dr Molefe earned R2.1 million for the year as chairman of the board.

Legal and professional fees went up, legal fees went up R22 million from R19 to R41 million, professional fees went up R139 million from R53 to R192 million. 

Corruption steals opportunities, creates unfairness, damages our economy, and hinders service delivery. The DA will not rest until all financial malfeasance and corruption is appropriately dealt with so that this agency may fill the mandated for which it was intended- to provide a service to the people who need it most.

Issued by Manny de Freitas, DA Shadow Minister of Transport, 3 October 2016