John Lawson CEO of the Cape Chamber of Commerce and Industry
A week ago we welcomed news of Prasa’s R66,3-billion budget allocation, much of which was earmarked for “rolling stock renewal’ and ‘ improving affordable rail travel”.
How refreshing, we said, to see the Finance Minister prioritising the needs of the hard-working citizens – by addressing the scourge of our crumbling commuter rail.
But is the Finance Minister throwing money at a lost cause? Billions of rands already funnelled to Prasa appears to have been a complete waste, according to a draft Webber Wentzel forensic report that surfaced this week. About R2,5-billion was reportedly spent to repair trains that have never been used and are sitting idle at railway depots. In other words, a handful of contractors enjoyed an income bonanza at taxpayers’ expense.
The draft Webber Wentzel report, commissioned by Prasa itself, is now gathering dust in anticipation of a ‘final’ version that appears to be taking a while to emerge, possibly due to its damning findings. One such finding is that at least three senior Prasa staff members voiced concerns about the rolling stock renewal project. Prasa’s acting chief financial officer, Brian Alexander, reportedly said Prasa ‘derived no value’ from the spending on the renewal project.
The concerns raised in this report illustrate a key point emerging in the narrative around the current economic crisis and how to create employment. Efforts to promote growth, whether via budget allocations or foreign direct investment, will be wasted unless government confronts the rampaging herd of elephants in the room – crime, corruption and mismanagement.
Paying contractors billions to fix trains that will never be used is akin to blowing a budget on an economy that will never perform.
Only by removing the obvious impediments to growth will tax revenue do what it is intended to do – move things forward, rather than hold us back.
Private sector partnerships in critical areas like public transport, logistics and energy will provide the necessary oversight to minimise fruitless and wasteful expenditure. We welcome moves to facilitate this process.
However, concerns about Prasa and management of other SOEs also highlights the need for policy reform to improve service delivery. Well-run cities or provinces are more suitable than unwieldy SOEs to manage public transport, particularly where cities have a good track record in utility management.
Delegating powers in critical areas such as transport and law enforcement could prove vital in ensuring we make the most of previous public funds.
