Road traffic group: We’re not bankrupt

2012-02-09 21:46

Johannesburg - The Road Traffic Management Corporation (RTMC) on Thursday denied being bankrupt, saying it was only "technically insolvent".

"Our stakeholders, which include partners, sponsors, creditors and the public [are] assured that the RTMC is in a better position now than it was in the past," acting chief executive Collins Letsoalo said in a statement.

"Austerity measures have also been implemented to ensure cost control and future financial sustainability of the entity. For all intents and purposes the corporation remains fully functional."

Letsoalo said the insolvency meant the agency's liabilities exceeded its assets.

"The RTMC is technically insolvent... this is as a result of approximately R200m worth of e-Natis [electronic national administration traffic information system] transaction fees that belong to the national revenue fund which was utilised irregularly by the previous management," he said.

"The matter is currently being regularised through a condonation and write-off process by the Minister of Finance [Pravin Gordhan]."

The Independent Online reported on Wednesday the agency was "teetering on the brink of financial collapse".

Letsoalo told the National Assembly’s transport committee on Tuesday the organisation was insolvent after the National Treasury turned down a request for additional funding.

Its financial crisis was reportedly caused by previous managers and the board, who presided over chronic mismanagement and gross irregularities that culminated in unauthorised spending of about R600m.

According to a report by a task team appointed to investigate the agency, millions were spent on luxury cars, unused office space and unnecessary auditing contracts, it was reported.

The agency, which reports to the transport minister, is responsible for co-ordination of traffic management in the country.

  • maseratifittipaldi - 2012-02-09 22:07

    Same Old Story. Broken, Stolen. Now R600 million must be written off and a few more ANC individuals are stinking rich. Never trust the ANC. If only our people can wake up.

  • Scouter - 2012-02-09 22:07

    "Only technically insolvent" - that must come out of the same lexicon as 'Creative Accounting'. Try telling your Bank that you are only 'technically insolvent' and see how they respond to your request for a loan.

      Ronald - 2012-02-10 00:48

      Let us see what magic they can come up with using " we are half way pregnant" or " we are clinically brain dead but not buried". Hey, they seem to need all the help they can get.

  • Eish - 2012-02-09 22:46

    When will this corruption that is rotten to the core be uprooted?

  • Sanet Oelofse - 2012-02-09 22:51

    "A society of sheep must in time beget a government of wolves."

      Scouter - 2012-02-10 02:16

      Great quote!

  • madiathomas - 2012-02-09 22:54

    Lolest, it's clear this guy is a politician, he is admitting bankruptcy in a sophisticated language.

  • Andrew - 2012-02-10 06:17

    Where are these previous managers who presided over the chronic mismanagement and spent R600m of public funds. Are they being charged and prosecuted or just merely suspended with full pay? It is sickening to read almost daily of these happenings with no action being taken against the perpertators.

  • betsy.compaan - 2012-02-10 09:17

    Eat while you can because once the people have nothing to eat they will come for you, so we need you to be fat, there's a lot of mouths to feed.

  • Willem - 2012-02-10 09:57

    If they are responsible for traffic management, what have they done? Where are they, why do we need them. What traffic do they manage?

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