Embattled Prasa faces crippling strike | Fin24
  • Load Shedding Schedules

    Find information for Johannesburg, Durban, Cape Town and other cities.

  • Channelling Thatcher

    A battle with unions will be the biggest test for Ramaphosa and Mboweni, writes Pieter du Toit.

  • Liberty

    We are no longer turning around, we are growing, says the group's CEO as profit surge.


Embattled Prasa faces crippling strike

Mar 15 2017 15:46

Cape Town - South Africa's rail passenger transport service risks coming to an abrupt halt over demands for a double-digit salary increase, warned the Federation of Unions of South Africa (Fedusa).

Fedusa is one of four trade union federations in the country with 18 affiliates from various sectors. An affiliate, the United National Transport Union (UNTU), has taken its fight for better working conditions to the the Commission for Conciliation, Mediation and Arbitration (CCMA).
"Fedusa fully supports UNTU’s decision to refer the dispute to the CCMA for conciliation after its members rejected Prasa’s wage offer increase from 3% to 4.5% on condition that UNTU lowers its demands from 20% to 12%."

UNTU is also demanding increases in members' medical aid, night shift, book off and standby allowances with effect from April 1 2017.
“We believe that millions of rands that are being wasted on a daily basis on irregular and fruitless expenditure by Prasa management could be used to pay decent salaries and other benefits for UNTU members,” said Fedusa general secretary Dennis George.

'Workers are gatvol'

UNTU members are "gatvol", said general secretary Steve Harris. "Our members are angry. Over the past year, the management of the passenger rail services ignored their pleas.”
Harris said UNTU members have been betrayed by Prasa.

"After Prasa management signed a collective agreement that gave UNTU members better benefits in the workplace, the state-owned enterprise refused to implement it. The result is that UNTU members bear the brunt because the union had to apply to the Labour Court in Johannesburg for a court order to force Prasa to comply."

READ: Prasa board dissolved with immediate effect

Prasa has faced serious turbulence in recent weeks.

Acting CEO Collins Letsoalo was fired by the board, following allegations that he hiked his pay by more than 350%. Shortly afterwards Minister of Transport Dipuo Peters dissolved the board and subsequently announced a new interim board.
However, the former board is not going without a fight. Former board chairperson Popo Molefe filed court papers to oppose the dissolution of his board and the appointment of an interim one.

READ: Lucky Montana wants to expose Prasa 'mafia'

In another legal battle, former Prasa CEO Lucky Montana filed an application seeking to assist the court in a case brought by Prasa against Swifambo Rail Leasing relating to a R3.5bn contract.

The Prasa board asked the South Gauteng High Court in Johannesburg to review and cancel a R3.5bn contract awarded to Swifambo in March 2013 to supply the company with locomotives made by Vossloh Espana SA.

Prasa instituted civil claims against Swifambo seeking R2.6bn. However, the firm has since declared bankruptcy.

Swifambo won a R3.5bn contract in 2012 to provide 70 new locomotives, which it bought from Spanish manufacturer Vossloh Espana. It was then revealed that the Afro 4000 locomotives were too tall for South Africa's rail network.

Read Fin24's top stories trending on Twitter:



Company Snapshot


Cuts to the public sector wage bill took centre stage at this year's Budget

Voting Booth

Do you support a reduction in the public sector wage bill?

Previous results · Suggest a vote