Something fishy about PRASA's R3.5bn locomotives deal - Ian Ollis

DA MP says the going Transnet engineering's rate for locomotives is R25m but these will cost R50m

DA requests A-G investigation of Prasa's R3.5 billion rail deal 

The DA will request that the Auditor-General, Terrence Nombembe, investigate the Passenger Rail Agency of South Africa's (Prasa's) R3.5 billion locomotives deal. 

According to media reports last year, Swifambo Rail Leasing was awarded a contract to provide 88 dual diesel-electric locomotives to Prasa for the Shosholoza Meyl's long-distance services.

Swifambo Rail Leasing will be acquiring these locomotives from Vossloh, a Spanish company, at R50 million per locomotive. Local train supplier Transnet Engineering's going rate for locomotives is R25 million.

Prasa's acquisition of locomotives from Vossloh, a foreign company, through Swifambo, is a violation of the Preferential Procurement Policy Framework (PPPF) and Treasury regulations on rail rolling stock which dictates that at least 55% of diesel locomotives and 60% of electric locomotives needs to be produced locally.

This also means that thousands of job opportunities that could have been awarded locally are now being shifted overseas.

Prasa's deal with Swifambo first raised suspicion when the DA was alerted to the fact that one of the company's directors was previously implicated in a tender corruption case of R10 million, while employed as Deputy Director-General of the Public Works Department in Mpumalanga in 2004.

Suspicions grew when the DA started receiving complaints that the locomotive specifications in the tender documents were written to favour Vossloh as a supplier and exclude most of the locomotive manufacturers used in the past.

The DA realises that to keep South Africans moving, the country desperately needs to upgrade our existing rolling stock as most of our fleet has already reached the end of their lifespan.

South Africa needs to be assured, however, that no tender irregularities occurred in awarding the contract to Swifambo and that the R123 billion rail rolling stock fleet renewal programme still to come, will not also be fraught with irregularities.

A full investigation is the surest way to achieve this.

Statement issued by Ian Ollis MP, DA Shadow Minister of Transport, October 13 2013 

Click here to sign up to receive our free daily headline email newsletter