Blade Nzimande. Picture: GCIS
Blade Nzimande. Picture: GCIS

Citing both the Passenger Rail Agency of SA (Prasa) and the cash-strapped Road Accident Fund (RAF), on Tuesday, Transport Minister Blade Nzimande bemoaned the dysfunction at some of the entities that report to him.

However, the DA lashed out at Nzimande over the appointment of Sibusiso Sithole, the former city manager of eThekwini, as Prasa’s new group CEO, describing him as having a chequered past and limited knowledge of the transport sector.

Briefing Parliament’s oversight committee on transport on some of the issues at the agencies, including the filling of board vacancies at Prasa, Nzimande had suggested that the frequent Cabinet reshuffles under former president Jacob Zuma could have destabilised many of the state-owned enterprises (SOEs).

He said Prasa was bleeding cash "like an ATM", while the RAF board was near collapse with members at each other’s throats.

"There is no unity there," said Nzimande referring to the RAF. He suggested that the board be disbanded. The fund has been in financial disarray for some time and has been struggling to pay road accident victims, something ascribed mainly to the failure of leadership.

As Nzimande was addressing MPs, Prasa issued a statement announcing Sithole’s appointment.

DA MP and transport spokesman Manny de Freitas said Nzimande had "short-circuited" Prasa’s revival and turnaround before it had even begun by authorising the appointment of Sithole as the company’s CEO, "despite publicly available information on his chequered past and limited knowledge of the transport sector".

"It is simply unacceptable that for an organisation such as Prasa, which is struggling under the weight of bad debt and poor corporate governance, the minister sees fit to appoint an individual who cannot manage his personal finances." said De Freitas.

"While he was eThekwini’s municipal manger it was revealed that Mr Sithole racked up almost R2m in bad debt, defaulted on his income tax, and was slow to take action against firms involved in tender irregularities with the city. In 2016, under unclear circumstances, he was asked to leave office early by mayor Zandile Gumede."

Nzimande defended the appointment saying Sithole should not be judged on his past financial problems. He said Prasa needed a permanent board, but because of the speed at which members of the previous interim board had resigned, he had to act quickly to put in place a temporary board pending further engagements.

The minister also said he had tasked the new board with identifying, within the next 12 months, more issues that need to be tackled at the agency. Prasa has been afflicted by tender irregularities, supply-chain management issues and corruption.

The rail agency paid more than R630m to Siyaya Rail Solutions from 2014 to 2017. Siyaya, a goods and rail services provider, has received more than R5bn in deals from Prasa over a number of years, with some of the deals being flagged as corrupt. This as the country’s rail services continue to flounder, with Cape Town rail lines hit the hardest.

Nzimande said the board was interrogating various contracts Prasa had entered into, some of which were questionable, and that he had called on the current interim board to take urgent action and challenge these contracts in court.

Said Nzimande: "One of the things I [noticed when I came in] was that the board did not adequately defend Prasa for cases that came before it. That is one of the reasons I saw [Prasa] as an ATM … people would make claims and the [previous] board [would not] dispute them."