The Passenger Rail Agency of South Africa (Prasa) is expected to announce this week the dismissal of four senior employees for security tender irregularities related to multi-million contracts issued about 10 years ago.
The four are senior managers in regions and at the agency’s head office and were allegedly involved in awarding two short-term guarding contracts totalling R30-million to companies that did not meet the requirements and without following proper processes.
The Mail & Guardian understands that some employees were served with dismissal notices this morning, but this was not confirmed by Prasa spokesperson Makhosini Mgitywa. He would only say that disciplinary inquiries involving Prasa employees had taken place in December.
“The rail agency will communicate with its stakeholders, including the public via the media, if and when there is something to report in this regard,” he said.
They were named by former public protector Thuli Madonsela in her August 2015 report, titled Derailed, which was an investigation into widespread looting and maladministration at the agency when Lucky Montana was the chief executive.
Initial complaints to Madonsela from the National Transport Movement trade union alleged that Montana was behind the security contracts — and the misappropriation of some R2-billion of Prasa’s funds. Other allegations included Montana having a role in the signing of a newsletter publication contract with a company belonging to a senior ANC official, as well as several other contracts with close friends and relatives.
Madonsela found the appointments of Sidas Security Guards and Vimtsire Protection Services to be irregular, but could not find any links to Montana.
She did find that in April 2009 the former regional chief: protection and security services, Chris Moloi, used his seniority and considerable influence in the Gauteng South region to terminate the contract of National Force Security and appoint Sidas, awarding a R3.7-million contract but without following procurement procedures including a competitive bidding process. Then assistant manager Ronnie Khumalo was also found to have acted irregularly in the Sidas appointment.
Despite this, Khumalo and Moloi were promoted to higher positions: Khumalo has been the head of department for the Gauteng region since 2017 and is in control of a R470-million budget, while Moloi was appointed to act as head of support services in the Prasa’s protection services.
As regional chief: corporate security Stephen Nkhuna, who denied any wrongdoing during his hearing was found to have flouted Prasa’s supply chain management policy as well as the Public Finance Management Act in the awarding of contracts to Vimtsire in 2010 (R4.6-million and R7.5-million) and 2011 (a R14.4-million extension).
Kabelo Matsane, the head of security at Prasa’s head office, failed to act to stop the irregular Vimtsire contract even after it was brought to his attention. The M&G understands that he did not submit any written arguments in mitigation after being found guilty during his hearing.
The M&G has learnt that on Friday Prasa’s human capital management division received a sanctions report from Pretoria advocate Simmy Lebala SC regarding the four senior managers. All four had been found guilty of misconduct and serious misconduct in their disciplinary hearings in December. Lebala had given them an opportunity to make written representation in mitigation.
Previous news reports have quoted Mgitywa saying that Prasa’s precarious financial position — which saw Eskom cuts power at its offices in Cape Town earlier this year — was a result of irregular expenditure under the watch of its senior officials and former board.
“Prasa is going through a debilitating cash flow crunch that has depleted its operational budget and further led to the company failing to pay suppliers and creditors,” he said.
The passenger rail company announced in March the suspension of 12 other senior officials linked to misconduct, following a report by the auditor general and Madonsela. Some arose from work by the Special Investigating Unit, according to Mgitywa.