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Prasa wants mediator for Transnet debt row

Oct 18 2010 12:53 I-Net Bridge

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Cape Town – The Passenger Rail Authority of SA  (Prasa) has proposed that a mediator be appointed to sort out the issue of a debt of about R1.3bn claimed by Transnet, and all matters relating to it.

According to Transport Minister Sibusisu Ndebele, Prasa has consistently disputed the amounts claimed by Transnet.

"The debt owed by Prasa to Transnet has been the focus of major engagement by the two parties for several months," he said in a written reply to a parliamentary question from Mannie de Freitas of the Democratic Alliance.   

He told De Freitas that serious concern has been raised by Transnet having taken months to substantiate the claims it is making against Prasa.

This issue arises from the challenges of separating the passenger rail entities (Shosholoza Meyl in particular) from Transnet and consolidating them into Prasa.  

"The discussion of the debt between the two parties has centred around several areas of dispute between the two parties, including, inter alia, issues such as supporting documentation and the lack of schedules that supported the maintenance, energy, haulage, shunting and other operational charges by Transnet to Prasa in respect of Shosholoza Meyl," Ndebele said.  

"Another area of dispute has been the levels of pricing for rolling stock upgrading work charged by rolling stock contractors, including Transnet Rail Engineering in this case."
 
The minister agreed with De Freitas that there is indeed a role for the private sector in the rail sector.  "It is important, though, to find the appropriate role and balance between the private sector and the state in funding rail passenger transport," he said.

"In fact, rail passenger transport will always require public funding in order to ensure affordability, due to the high cost of rail infrastructure, which the passenger will be unable to afford without some form of government support.  

"Therefore, there are key policy interventions necessary, such as effective regulation and upgrading of the system in order to make it attractive for the private sector to invest."

In the short term, he said, Prasa is implementing various measures to introduce efficiencies to the operations of Shosholoza Meyl. These include the introduction of new and modern conditions of employment (including a three-shift system), introducing a wide ranging efficiency project with the assistance of international rail experts, negotiating favourable pricing with suppliers to the rail business aimed at improving passenger services, while at the same time reducing the cost of delivering much-needed transport services.

transnet  |  prasa
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