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Cape Town - Minister of Transport Joe Maswanganyi has welcomed the Pretoria High Court judgment that the two contracts entered into by the Passenger Rail Agency of SA (Prasa) with its former chief financial officer (CFO) and consultant Fenton Gastin were invalid and unlawful.
The first contract was hiring him as a CFO. It included about R3.4m as part of a "mutual separation" agreement. The second was a day-to-day consultancy contract given to him by Prasa after he had basically been fired. Gastin must pay back R8.22m to the agency. Former Prasa group CEO Lucky Montana concluded the contracts with Gastin.
Prasa demonstrated to the court that Gastin and Montana maintained a relationship "with the purpose of defrauding the rail agency".
“As government, we are a constitutional state, governed by laws, regulations and policies. We have committed ourselves to deal decisively with fraud and corruption and will do everything in our power to root out these acts of dishonesty and criminality wherever they emerge,” said Maswanganyi in a statement on Wednesday.
He said that, as a shareholder, he has the responsibility to ensure that Prasa delivers on its core mandate and that such delivery is underpinned by prudent and good governance principles.
“As the Prasa shareholder, I will continuously monitor progress and ensure that necessary controls and systems are put in place to promote good governance, because commuters in our country who heavily rely on public transport deserve nothing but the best,” Maswanganyi said.
"I will further direct the soon-to-be-appointed board of Prasa to go deeper into the perceived corruption and leave no stone unturned when dealing with matters of corruption at Prasa, especially in relation to the auditor general and Public Protector’s reports and others brought to their attention."
A report by the Public Protector in August 2015 refers to numerous irregularities at Prasa and directed the organisation to investigate the matters. Prasa has indicated that it has started to take steps in this regard.
In June, Fin24 reported that forensic investigations into Prasa's affairs have amounted to R148m over two financial years. Besides the R148m investigation costs in the 2015/16 and 2016/17 financial years, an additional R14m is budgeted for the current financial year.
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