The revelation of the huge amounts Prasa wastes has left the Auditor-General wailing that effective steps weren’t taken to prevent the waste as instructed by the Public Finance Management Act (PFMA).
As culled from the Passenger Rail Agency of South Africa’s 2015/2016 annual report, R4.1 billion was wasted in irregular expenditure. The report also indicated another R9.8 billion waste relating to previous years.
The report highlighted vast corruption within Prasa. As learnt, South Africa’s Directorate for Priority Crime Investigation (Hawks) is investigating 39 cases of corruption at the public entity.
Aside that, the National Treasury is conducting a separate investigation related to 100 contracts. The investigation is in line with the remedial action from the Public Protector’s ‘Derailed’ report.
Reacting, DA’s Manny de Freitas, the Shadow Minister of Transport asserted that it is no surprise Prasa wasted the billions unnecessarily.
De Freitas pointed out that former CEO, Lucky Montana was paid R3.9 million for the rest of his contract after he was fired in July 2015.
“On top of this Mr. Montana received other remunerations to the tune of R458 000…,” stated De Freitas.
The DA Shadow Minister highlighted the following as some of the 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.
With that, De Freitas promised that the DA will not rest until all financial malfeasance and corruption is appropriately dealt with to enable the public entity effectively offer the service it was created to provide.
“Corruption steals opportunities, creates unfairness, damages our economy, and hinders service delivery,” added De Freitas.