Covid-19

LOCKDOWN: PRASA

Covid-19 shutdown of trains sees rail agency lose almost R200m in revenue

New Prasa administrator Bongisizwe Mpondo tells the media that within the next three months, he plans to stabilize services in Cape Town, where most security issues occur. 23 January 2020. (Photo: Suné Payne)

The struggling Passenger Rail Agency of South Africa has already projected losses of R199-million during the country’s Covid-19 lockdown. Projects are stalled and voluntary severance packages might be offered to workers. This was unpacked for the media during an update on administrator Bongisizwe Mpondo’s first few months at the helm of South Africa’s rail agency. 

One month of non-operation due to Covid-19 has cost the Passenger Rail Agency of South Africa (Prasa) about R199-million, its administrator, Bongisizwe Mpondo, said on Thursday 7 May. At a briefing, four months into his year-long tenure at the agency, Mpondo gave an update on Prasa’s recovery plans.

He does not have an easy task. The coronavirus pandemic and lockdown has seen the already financially struggling entity plunge ever further into the red. Current projections for the financial year put the total loss at R757-million.

“Cash-strapped”, “broken”, “like an ATM”; these are some of the words used to describe Prasa’s financial situation this week. But even back in January Mpondo described the entity as “broken” – a sentiment echoed by Transport Minister Fikile Mbalula.

“This, I indicated, was largely due to the systematic erosion of value the business had experienced over a number of years,” said Mpondo on Thursday. “I then made the commitment that we as Prasa officials, do not have a choice but to bring a semblance of order to this important institution, whilst striving to deliver value to our customers.”

With Mpondo only given a one-year mandate to get things back on track, any revenue loss will hinder his efforts.

“The impact of the Covid-19 lockdown on the procurement and construction programme is not fully known at this stage,” said Mpondo. Among plans to fix the state-owned entity is to fix two key railway lines: the Central Line in Cape Town and the Mabopane Line in Tshwane. These lines were due to have limited operations running by October 2020, but the target date is now April 2021. If Mpondo’s tenure as administrator does last just a year he will not be in office to see his ambitions realised.

A key issue discussed at the briefing was possible voluntary severance packages for employees. On Tuesday, Mpondo sent a letter to trade union Numsa’s leader Irvin Jim informing him of potential lay-offs. Mpondo said it was “unfortunate” the letter had been leaked to the media as it was intended as “an invitation to have conversation” about the financial situation at Prasa and cutting costs at the rail agency.

Questioned by Daily Maverick about this, Mpondo pointed out that some 2,500 employees were close to retirement age and that was “a criteria we’re putting forward and we’re discussing with labour”. Mpondo said Prasa would meet unions over the next few days to discuss the matter.

It was not all bad news. Under Level 3 lockdown restrictions, some Prasa services will resume. And while Metrorail, a subsidiary of the rail agency, is not operational, thorough sanitising of stations and trains is underway.

Other future safety measures will include:

  • Screening and testing at stations in conjunction with the Department of Health
  • Deep-cleaning and disinfection programmes at all depots and stations
  • All trains to be disinfected after each trip
  • Employees, in line with government regulations, to be issued with protective equipment. Should there be a shortage of funds for this due to Prasa’s finances, the agency will ask the Department of Transport to cover some costs

 

On Monday 11 May, Mpondo and Transport Minister Fikile Mbalula are due to address Parliament’s portfolio committee on transport on Mpondo’s tenure as administrator and changes at the struggling rail agency. DM

 

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