BREAKING: Peters tells Prasa to halt contracts probe

2016-08-24 11:35
Minister of Transport Dipuo Peters. (GCIS)

Minister of Transport Dipuo Peters. (GCIS)

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Johannesburg - Transport Minister Dipuo Peters has instructed Prasa chairperson Popo Molefe to stop the parastatal's ongoing investigation into contracts worth billions of rands awarded during the tenure of Lucky Montana, Prasa's former CEO.

News24 has learnt from three sources at the Passenger Rail Agency of South Africa (Prasa) that Peters had last week written a letter to Molefe in which she instructed him to put an end to an investigation commissioned by the Prasa board.

The initiation of the probe followed Public Protector Thuli Madonsela's damning Prasa report last year, in which she instructed Prasa and the National Treasury to launch investigations into all Prasa contracts valued at above R10m.

Law firm Werksmans was appointed by the Prasa board to conduct its investigation.

Not budgeted for

According to the sources, Peters maintained in her letter that Prasa had not budgeted for the investigation and that it therefore needed to be canned immediately.

The sources say the timing of her letter is curious, seeing as the investigation has been continuing for more than a year without any such complaint from Peters. 

One source says the investigation's focus on Siyangena Technologies and Swifambo Rail Leasing, two companies against which Prasa has instituted civil claims, had resulted in high-ranked politicians being canvassed by powerful businessmen in an effort to have the probe stopped.

Swifambo Rail Leasing won a R3.5 billion contract in 2012 to provide 70 new locomotives to Prasa.

Swifambo subsequently bought the locomotives from Spanish manufacturer Vossloh Espana, after which it was revealed that the latter's Afro 4000 locomotives were too tall for South Africa's rail network.

Siyangena Technologies scored two contracts, totalling some R4 billion, to install security cameras, access gates and related security products at Prasa train stations across the country.

The appointment of both companies has been mired in controversy and both contracts are said to have been accompanied by possible corruption.

Prasa has alleged in its court papers that Siyangena had bought Montana upmarket properties worth millions of rands through a Pretoria lawyer linked to the company.

Questionable payments

Earlier this year Rapport revealed that individuals associated with President Jacob Zuma and his family benefited from the Swifambo contract to the tune of R80 million in questionable payments.

News24 revealed earlier this month that Roy Moodley, a Durban-based security tycoon and close friend of Zuma, had received payments of about R550 million from Siyangena.

Peters's instruction to Molefe comes at a time in which Zuma seems to want to exert more control over the country's state owned companies (SOCs), including Prasa.

On Monday Jeff Radebe, Minister in the Presidency for Planning, Monitoring and Evaluation, announced that the Presidency would start work on the creation of a Presidential State Owned Companies Co-ordinating Council.

Such a body would "provide President Zuma line of sight on strategic decisions and interventions to create SOCs that play a transformative role in a capable developmental State", Radebe explained.

Zuma's office denied that he had played any role in Peters's instruction to Molefe.

"President Zuma has not issued any directive that the Prasa investigation be stopped," said Bongani Ngqulunga, Zuma's spokesperson.

Molefe said he was not willing to comment at this stage.

Ishmael Mnisi, Peters's spokesperson, confirmed receipt of News24's queries and indicated that he would provide a response.

He had not done so by Wednesday morning.

Read more on:    prasa  |  lucky montana  |  dipuo peters  |  jacob zuma  |  popo molefe  |  corruption  |  government spending

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