Top government official tried to get Prasa to settle disputed contract, Zondo inquiry hears

(Photo by Gallo Images / Beeld / Alet Pretorius)
(Photo by Gallo Images / Beeld / Alet Pretorius)
  • The acting director general at the department of transport wanted the matter settled out of court
  • The settlement route would have come at a great cost to Prasa
  • Siyangena Technologies is still embroiled in a bitter dispute with Prasa

A top official at the department of transport allegedly talked the chief financial officer of the Passenger Rail Agency of South Africa into settling a multi-billion-rand legal dispute with the agency over its contract – to Prasa's disadvantage.

This is according to evidence delivered by Martha Ngoye, Prasa's head of Legal Risk and Compliance, before the Commission of Inquiry into State Capture on Tuesday.

The company in question, Siyangena Technologies, was awarded a multi-phase R4-billion contract to modernise railway stations ahead of the FIFA World Cup in 2010.

The contract later came under fire for a number of irregularities. Prasa later challenged it in court, arguing that the company had installed outdated, overpriced and ineffective security systems. It wanted the contract set aside.

Ngoye told the inquiry, headed by Deputy Chief Justice Raymond Zondo, that acting Director General at the department of transport, Chris Hlabisa, had tried to intervene in the matter and instructed Prasa's senior finance executives to verify the claim with a view to settling it.

The acting DG had emphasised that he would "not want government money wasted on litigation matters which would only benefit lawyers and not government"; therefore the legal battle must be brought to a halt.

"The settlement route is adopted not only when influential people are involved but is extended to others as well, to Prasa’s great prejudice," Ngoye said.

Vilified

The Siyangena matter has remained the subject of a protracted legal battle, beset by numerous delays. It court matter was again postponed in February this year.

The controversial contract was signed during Lucky Montana's tenure as CEO.

Ngoye's work as Prasa's head of legal put her at the forefront of fighting questionable contracts, which saw billions of rands lost to irregular expenditure an improper tenders.

She told the commission that she was often vilified and put on suspension by her superiors, who were opposed to any probe around improper financial expenditure.

The inquiry, which resumed on Monday, has also heard evidence from the former chairperson of the Prasa board, Popo Molefe, who described a web of patronage and corruption at the agency, which is currently under under administration. 

Bongisizwe Mpondo was in December appointed Prasa administrator.

However, in her evidence on Tuesday, Ngoye questioned the legality of the appointment of an administrator, saying it was "not provided for in law that applies to Prasa".

"I do not believe this is lawful," she said.

The commission will continue hearing evidence relating to Prasa in the coming days.

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