Media Statement

To: All Media

Date: 30 January 2021
Embargo: For Immediate Release

PRASA Terminates Contracts of Executives

PRASA Board of Control has embarked on the review of contracts of executives

and other senior managers. Pursuant to the review process, it transpired upon
analysis of employment contracts of executives that some of them (executives)
ought to have left PRASA years ago. All executives at PRASA are employed for a
period not exceeding 5years with no expectation for extension of the
employment contract. The Board also observed that the executives have been
aware at all material times that their employment contracts were for five-year
period and not more. However, it appears the executives capitalized on the
instability at the Board level culminating in their extended and unlawful stay at
PRASA. On 29 January 2021, PRASA has terminated the employment contracts
of the following executives with immediate effect:

Ms. Martha Ngoye, Group Executive: Legal, Risk and Compliance was initially
employed in 2012 as CEO of Intersite, one of PRASA’s subsidiaries. Effective from
1 September 2015, she was transferred to her current position. Ordinarily,
Ms. Ngoye’s stay at PRASA ought to have terminated on 31 August 2020. PRASA
has also resolved to institute legal proceedings against Ms Ngoye for unlawfully
approving payment of R58m to SA Fence & Gate when she had no authority to do
so.

Mr. Nkosinathi Khena, Chief Operations Office reinstated the SA Fence and
Gate’s contract knowing of the company’s breach (SA Fence & Gate) which
breach was also brought to his attention by National Treasury in a letter dated 21
April 2016. An amount of R25m was paid to the said company without requisite
authority and/or approval. Mr. Khena was at the time Acting-Group Chief
Executive Officer and his unlawful conduct caused PRASA to incur financial
loss. Further, Mr. Khena reinstated Ms Ngoye, who at the time was lawfully
suspended by Mr. Lucky Montana (Group CEO as the time) for unlawful approval
of R58m to SA Fence and Gate. PRASA will institute legal proceedings against
Mr. Khena for financial loss it suffered due to unlawful conduct of Mr. Khena.
Mr. Khena has been on suspension and his employment contract was
terminated with immediate effect as of 29 January 2021. Mr Khena’s role in
unlawfully appointing Werksman firm of attorneys will also receive priority.

Ms. Pearl Munthali, Chief Executive Officer of PRASA Foundation has been on
suspension for alleged misconduct. Upon perusal of records, it transpired that
Ms. Munthali's contract ought to have been terminated upon the expiry of a
five-year term.

Consistent with the recommendations from the Auditor General, this Board will
ensure that systems are put in place at PRASA and the core business of running
passenger rail is restored. The Auditor General in its report on PRASA noted that
there was no culture of consequence management. The Board has assured the
AG and Minister of Transport that consequence management would be one of
the priorities implemented to clean up PRASA. The Acting Group Chief Executive
Officer, Ms. Thandeka Mabija will appoint firms of attorneys to specifically deal
with consequence management at PRASA. This process will proceed without
delay and should be concluded expeditiously.

Ends
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Issued By:
PRASA Board of Control Mr Leonard Ramatlakane