Appointment of new Prasa administrator could be challenged in court

The transport minister's decision to put the rail agency under administration seems to have flouted the law.

The interim board of the Passenger Rail Agency of SA (Prasa) has been dissolved by Transport minister Fikile Mbalula who on Monday also put the state-owned entity under administration with immediate effect.

“The previous board has failed, it failed to answer questions in Parliament in front of me. It failed to do the things it should have done in its own time. It failed to provide information to Parliament,” said Mbalula at the media briefing where he announced the decision, which seems to have cut legislative and legal corners and may undermine the authority of the newly appointed administrator Bongisizwe Mpondo.

According to Daily Maverick, the minister apparently contravened the Legal Succession to the South African Transport Services Act of 1989,  amended in 2008, which states that a decision like the he has made can only be ligitimised on the authority of Parliament. 

Specifically, section 29 of the act states: “The corporation shall be liquidated or placed under judicial management only on the authority of an act of Parliament.”

That the minister appears to have done so unilaterally means the new administrator, who has served on the boards of various SOEs and is charged with steering the ship at the maligned rail agency, may have his hands tied regarding his own authority which will come into question if his decisions, or even his appointment itself, are ever challenged in court. 

Among the many obstacles that the new administrator is facing will be to arrest the decline at Prasa, whose poor governance has led to allegations of corruption and maladministration that saw many of the company’s now former leaders have been implicated.