David Williams revisits PRASA: Chaos deepens as CEO fired on flimsy grounds

BizNews founder Alec Hogg caught up with journalist, researcher and author David Williams, discussing State-owned enterprise PRASA after CEO Zolani Matthews was fired over very ‘questionable’ dual citizenship grounds.”There are a couple of issues here. [He comes] in and, from what one hears, he’s trying to put things in place. Now, he’s been dismissed apparently for having not declared a dual citizenship, on security grounds. You have to ask, what is so top secret about passenger rail?”

David Williams on the state of South Africa’s railway system 

I’ve done more work on it since we last spoke and it just gets worse when you look at the details of it. I think the core issue here is security, and maybe that’s an issue beyond rail. If you look at a country that is largely industrialised, certainly in the urban areas like South Africa, there is a lot of infrastructure. To drive an economy like this, you need functioning organisations in rail, electricity and water and so on. We have had repeated allegations from Eskom recently about deliberate internal sabotage of infrastructure.

The railways, certainly, there may be sabotage, the burning of trains in the Western Cape over the last few years, which we haven’t really discussed. This is criminal arson and hundreds of train carriages, at a cost of millions of rand, have been burnt and destroyed in the Western Cape. That is arson/sabotage. The network itself is in such decay that very few trains are running. Just to restore this network back to something like what it was before, for passenger rail and for freight rail – but we’re talking Passenger Rail Agency at the moment – is going to cost hundreds of millions, possibly billions of rand. 

The issue is security. Before you do anything else, how do you stop people stealing the railway lines? It’s become a kind of brigandage. There is no law and order when it comes to protecting the infrastructure. Reports have come through over the years of thieves taking the copper cables, the overhead wires and the signalling wires, digging up stations to get at cables under the ground. 

This happens to City Power in Johannesburg all the time as well. There appears to be no attempt or no strategy – certainly, nothing is working – to stop these guys. They do it in broad daylight. There appears to be no arrests, let alone convictions. 

On Zolani Matthews’ termination as CEO of PRASA

He was on suspension and they said [his dual citizenship] was the reason. There were some hints at some other activity, that he hadn’t achieved what he was supposed to achieve. There are a couple of issues here. One: the man comes in, he has been there six months or so. [From] what we hear, he was trying to put things in place to start fixing things. Now he’s been dismissed, apparently, for having not declared dual citizenship on security grounds. You have to ask: what is so top secret about passenger rail? 

This is an industry where there’s a lot of co-operation across the world. The technology is very common. Countries co-operate with each other on what kind of trains to run, on procurement and things like that. So it is a very strange reason. It’s not like he is a general in the defence force. What is the security issue? Surely, you could find a way of saying, “Oh, you should have declared that. Well, we’ll forgive you. We’ll will find a way around it.” As he has made clear, this was never a secret. He lived in exile in the UK. His father was Joe Matthews. He comes from a great, struggle family. He lived in England for a long time. He had British citizenship. He is also a South African citizen.

There are a lot of people who have this status. Whether he wrote it down on a piece of paper or not, to me, seems immaterial. As you say, [we have to question] the real reason for them doing this. They actually worked quite hard to get him in. They understood, the board, that this was an appointment that needed to be made. They’ve had a dozen CEOs, most of them [in an acting role] over the last 10–15 years. All of them have failed. Some of them have been before the Zondo Commission, and there are questions about ethics and so on. This was a really important appointment to make, especially given the damage that was done over the last 18 months, in particular. A really important appointment. 

You would think they would do their homework, get the right man and appoint him. Then when he was appointed, there were objections because he was too old; that he didn’t meet the civil service requirements of being under 63 on appointment. They rejected those objections and said, “No, he’s the right man for the job. We’ll find a way. There is a way of appointing someone who is over age.” I’m sure there is a clause somewhere that says the minister has discretion if they want to. They really tried hard to appoint him, they must have done homework.

He’s only been there six months. It’s hard to imagine, if he has made big mistakes, what they are in such a short time. In such a position, you spend the first few months finding out where everything is, who is running what and trying to get things going. Then you start [asking], “Well, what is it?” Is he uncovering corruption that certain interests don’t want uncovered? Is he bumping up against vested interests? Is there a political dimension to this? Has he upset people in the government? Has he upset people among the partners of the government? These are the kinds of questions we ask when we are told that he’s been dismissed for having dual citizenship. 

On what President Ramaphosa should be doing

Well, in this case, particularly. It’s this very strange anomaly when they split passenger rail from freight rail, it was a unified organisation and it’s now divided. This has caused huge structural legacy issues. For example, in the old South African Railways – Transnet – in the early years, you had passenger trains and good trains, all using the same network. Some lines [were] dedicated to passengers only, like some of the suburban lines – the Mabopane corridor outside Pretoria, for example, the big link to Soweto – there’s a four-line railway going to Soweto. 

These are dedicated passenger lines. But in many areas, goods trains used them as well and that worked perfectly well under the old Transnet South African railways. For some reason, they felt that these two functions should be split. The result is, you have, over the years, PRASA complaining that Transnet won’t give them locomotives. Passenger trains no longer enjoy priority. In the old days, they always enjoyed priority. They were scheduled and that had the effect of imposing discipline on the entire network. 

Trains had to run on time in very scheduled spots. If one train went wrong or broke down, then it would disrupt the whole network. Now, passenger trains have lost that priority on the joint lines. Transnet Freight Rail doesn’t care about passengers, and why should it? That is not its brief. There is a history, if you go through it, corruption takes the headlines, but there’s a history of internal strife between the two railway managers. They bicker about locomotives, they bicker about who is going to fix what. There is land which PRASA owns, which Transnet used to own, and there’s land that should be transferred that hasn’t been transferred. There are a lot of accounting issues to do with the split between these two organisations that happened 20 years ago. 

The accountants and the managers fight about who owes what to whom, who is responsible for what, which trains run where and who has priority. This is all leaving out the theft, corruption and inefficiencies in other ways. [Governance is fundamental and] in this case, it is a crucially important subject, because PRASA reports to the Minister of Transport and Transnet reports to the Minister of Public Enterprises. The only way to get these two organisations together, it would seem – because they have not really got together yet – is to abolish that distinction and get Transnet to report to the Minister of Transport. Structurally, I’m not talking about personalities. We are talking about structure here. Now you’ve got two ministers running different organisations. 

Their managers presumably have different incentives, different ways of doing things which leaves it up to just one man in the country to sort this out and that is the president, because he’s the only one who could say and get through a decision to say: “Let’s  combine these two portfolios, let’s move Transnet to PRASA or join them and make them report to the Minister of Transport,” who really is the person who should be responsible for Transnet. 

I think it’s difficult enough running a business without such structural impediments. You’ve got double structures that don’t always talk to each other, are sometimes hostile towards each other and in the circumstance of disaster, corruption and theft – in military terms – it would be like having two allies fighting each other instead of fighting the enemy. The enemy in this case is corruption, inefficiency, waste dereliction and disaster of a rail network. 

[There] appears to be no urgency, no clear thinking, no common sense. There’s no shortage of PowerPoint presentations and meetings, you can be sure of that. But whether this is work that’s going to produce a solution is certainly not clear. I think it’s a presidential responsibility. It’s a simple thing to grasp and not so simple to do, but simple to grasp. But there is no evidence that anyone’s realised that this is a problem. 

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