Prasa malfeasance and maladministration go back a long time

Why was the passenger rail agency allowed to slide into almost total ruin?
The Prasa board chaired by Popo Molefe (pictured) raised its concerns – but got no support from Zuma, Ramaphosa, the ANC Top Six or The Hawks. Image: Moneyweb

Corruption at the Passenger Rail Agency of South Africa (Prasa) stretches back a very long time, and involves the politically connected, those in high office, the enablers, connivers and the schemers.

There were also numerous indications and warnings of malfeasance over the years.

The dodgy R3.5 billion “investment” in rolling stock was made way back in 2012, according to Prasa’s 2012 annual financial statements.

A new board was established in 2014 under chair Popo Molefe. Lucky Montana was still Group CEO at the time.

Read: Lucky Montana: ‘We were not involved in criminality’ at Prasa

‘Derailed’

In August 2015 the previous Public Protector (PP) Thuli Madonsela released her report titled ‘Derailed’, which dealt with various allegations of corruption, malfeasance, improper termination of employment contracts, and suspension of employees.

Madonsela recommended that contracts worth over R10 million from 2012 be investigated.

Then-Auditor-General (AG) Kimi Makwetu also warned of malfeasance, stating in his 2015 report on Prasa’s financial statements to parliament that Prasa had incurred irregular expenditure of R500 million, demonstrated non-compliance in procurement, and had not notified National Treasury of the award of an unsolicited bid proposal to the value of R91 million.

In August 2015, as a result of the AG’s adverse findings, the Prasa board under Molefe appointed Werksmans Attorneys to carry out an investigation into large contracts.

These included the R3.5 billion locomotive contract, and contracts valued at some R2.8 billion awarded to Siyangena Technologies. Thereafter, Werksmans’ scope of work was broadened to include matters that arose from the PP’s report.

Read:

Molefe told the Zondo Commission that the Prasa board encountered obstacles and resistance, “not least from” Montana (who, according to Molefe, viewed the new board with suspicion and left in July 2015 when his contract expired).

Molefe was informed that Auswell Mashaba, chair of Swifambo Rail Leasing, which had been awarded a contract to supply locomotives to Prasa at a cost of some R3.5 billion, had been directed to pay some R79 million to intermediaries who would pay the money over to the ANC.

Molefe reaches out to the ANC Top Six

In 2015 Molefe approached the ANC Top Six to raise his concerns regarding corruption and malfeasance, the excessive amounts involved, and the alleged kickbacks to the ANC.

The Top Six at that time comprised then-president Jacob Zuma, deputy president Cyril Ramaphosa, national chair Baleka Mbete, secretary-general Gwede Mantashe, deputy secretary-general Jessie Duarte, and treasury general Zweli Mkhize.

The Top Six were non-committal.

Zondo Commission chair Chief Justice Raymond Zondo remarked that not “even a single one of them ever contacted Molefe to find out how he was doing in his fight against corruption”.

Zondo also found, as outlined in Part V, Volume II of the Zondo Report, that Ramaphosa “fell short of the standard that would have been expected of him in a matter involving fighting corruption”.

Molefe was invited to meet with Zuma, minister in the presidency Jeff Radebe, transport minister Dipuo Peters, and Montana at the Presidential Guest House in August 2015. Zuma was only concerned about the public spat between two ANC members of high standing.

The Molefe board “was rendered dysfunctional even before its term of office formally ended on 31 July 2017”.

After Molefe left, a permanent board was not appointed until 2021.

Zondo found that the evidence has clearly revealed “that neither the ANC leadership, the National Executive nor the Portfolio Committee on Transport wanted to assist this board in its fight against corruption at Prasa”.

Zuma gave it no support, Ramaphosa gave it no support, and the Top Six gave it no support.

The Hawks have done nothing

In 2016 Molefe wrote to the Hawks on the “grave revelations” that had been uncovered, as well as the lack of progress on matters that had already been reported.

In 2017 the board applied to the high court for an order compelling the Directorate of Priority Crime Investigations (DPCI) to act on the criminal complaints – which the DPCI opposed, raising two technical objections. The high court found against the DPCI.

Zondo lamented: “It is quite worrying that many years after complaints were laid with the Hawks, nobody has been charged.”

Zondo proffered as a possible reason why the DPCI “dragged its feet” in investigating the criminal complaints made by Prasa that “it may be connected with the risk or fear that any proper investigation may well lead to the ANC or to certain figures within the ANC”.

Prasa left adrift and rudderless

After Montana left in July 2015, Prasa had to operate without a permanent Group CEO until March 2021.

Neither Peters nor her minister of transport successor Joe Maswanganyi did the necessary to have a new GCEO appointed.

Zondo exclaimed this was “totally unacceptable”.

Zondo found that those responsible for not ensuring that a GCEO was appointed were Zuma, Ramaphosa from the date he was appointed president, and the respective ministers of transport from April 2017 until current Minister of Transport Fikile Mbalula was appointed in May 2019.

Zondo’s recommendations

Zondo’s recommendations include:

  • That the DPCI finalise its investigations as soon as possible;
  • That the senior employees who played a role in awarding the Swifambo contract be prosecuted; and
  • That investigations should be conducted to determine further prosecutions.

Zondo decided that a special commission of inquiry be appointed to determine why Prasa was allowed to slide into almost total ruin, who should be held responsible, and who could have benefitted from this “unacceptable state of affairs”.

Read Parts 5 and 6 of the Zondo Report:

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2012 – And no one in jail yet !!
There is NO justice system left in this country any more.

Thanks to the O’ANC for destroying every last SOE there is.

The question – why was the rail service allowed to slide into almost total ruin?
The answer – to allow the taxi associations ( apparently mostly owned by members of our Police force) to thrive.
Yet another lesson in Radical Economic Transformation ( RET) or just African stupidity?

End of comments.

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