Metrorail denies financial problems

THE Democratic Alliance says it has letters that were leaked to the party that show that Metrorail can no longer meet its financial commitments to service providers.

THE Democratic Alliance says it has letters that were leaked to the party that show that Metrorail can no longer meet its financial commitments to service providers.

DA spokesperson Manny de Freitas said the letters, dated January 13 2010, stated that Metrorail was experiencing cash flow challenges in meeting its financial obligations.

"This state of affairs is simply unacceptable, considering that we exposed in December the blatant wasteful expenditure of R584810,92 by Metrorail for a Women's Day celebration held in August 2009," he said.

By November 2009, this bill was yet to be settled.

"State-owned entities such as the SABC and Eskom have continued to squander public funds through wasteful and fruitless expenditure, corruption and financial mismanagement, thus requiring bail-outs from the already burdened public purse. It seems as though such a situation may also be developing with Metrorail, a division of the state-owned Passenger Rail Agency of South Africa," De Freitas said.

He said the party will be submitting parliamentary questions to Transport Minister Sbu Ndebele in order to gain further clarity on the matter.

However, Prasa spokesperson Tiro Holele dismissed the DA's statement and what is contained in the leaked letters as lies. He said like many companies, Prasa was managing its cash flow tightly and had implemented strict programmes to manage the cash flow.

Holele said service providers were being paid and the system of payment within 30 days after receiving an invoice applied.

"The DA statement is informed by ignorance, malice and especially in ignorance of the massive capital improvement we are making to the passenger rail system." - Sapa

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