Battling transport utility Prasa will restart only at lockdown level 3

Embattled Prasa has lost R199m so far due to the Covid-19 lockdown.
Embattled Prasa has lost R199m so far due to the Covid-19 lockdown.
Image: Gallo Images / Rapport / Deon Raath

Struggling transport utility Passenger Rail Agency of SA (Prasa) says it has lost R199m since the start of the lockdown to curb the spread of Covid-19.

Prasa administrator Bongisizwe Mpondo said the loss added cash constraints to its already strained financial situation. The revenue loss now projected for the year is R757m.

Mpondo disclosed the figures on Thursday when he briefed reporters on progress his team has made in its drive to turn the company around since he took over as administrator on December 9 last year.

Prasa terminated all services during levels 5 and 4 of the lockdown in line with the Disaster Management Act regulations.

Mpondo said the lockdown also severely affected Prasa’s planned critical maintenance work due to the continued shortage of required commodities, as key suppliers were closed during the lockdown.

He said Prasa was looking at offering voluntary severance packages (VSPs) to about 2,000 of its employees nearing retirement age to address the cash crunch. He had addressed a letter to unions, asking for consultations on the VSPs, citing Prasa’s deteriorating financial position, which was worsened by Covid-19.

The administrator is meeting organised labour on Thursday, Friday and next week to discuss this, among other issues bedevilling the utility.

Mpondo said the loss in
revenue had a big effect as the operating subsidy from the department could not cover Prasa costs. His team was working on initiatives aimed at improving revenue over time and also reducing other costs, including overtime, allowances, travel and accommodation.

He said it was an accepted practice at Prasa over the years to budget for a deficit, and said his plans look to change this unacceptable budgeting culture. Mpondo said train operations would resume under level 3 of the lockdown, adding that Prasa has put precautions in place to limit community transmission and outbreaks.

There would be screening and testing at stations in collaboration with the department of health. Crowd management and social-distancing would be practised, while sanitation booths were being sourced for stations.

A deep-cleaning and disinfection programme had begun for depots and stations.

"In January, I characterised Prasa as a broken business. I made a commitment that I
will bring a semblance of order to this organisation. We are registering steady progress," said Mpondo.

Since coming to Prasa, his team had set up a robust executive committee structure, which had been meeting every two weeks since January, supported by five sub-committees meeting twice a week.

Mpondo said Prasa instituted charges and suspended 12 senior members implicated in a investigation reports.

"Where instances of possible corruption arise, these will be promptly handed over to the National Prosecuting Authority (NPA) for processing."

He said there are still matters being processed by Prasa, the Special Investigating Unit and the Hawks.

"Announcements will be made as progress is registered on these matters."

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