Prasa to offer voluntary packages to avoid retrenchments

Passenger Rail Agency of South Africa (Prasa) has initiated discussions with unions about voluntary severance packages, as the state-owned entity’s finances suffer due to the Covid-19 (coronavirus) pandemic.

Prasa spokesperson, Makhosini Mgitywa, said Prasa sent letters to union leaders requesting a discussion on the state entity’s financial status and the possibilities of voluntary severance packages to be taken by some employees.

“This decision was taken so the organisation can stay afloat and sustainable,” he said.

Mgitywa said Prasa administrator Bongisizwe Mpondo would be discussing the age criteria and positions of those to which the packages will be offered.

He said Prasa would not strip everyone to a point that it will not be able to continue services, especially with regards to critical skill workers.

“We are looking at people who are not in the category of critical skills.”

Mgitywa said there would be constant engagement with union leaders throughout the process of the proposed job cuts.

“I am sure we will reach a conclusion that will be in the best interest of the organisation.

“Right now we pay more than 50% of the salaries from our operational budget, which is very high, because with that budget we still need to pay Eskom and other service providers.”

He said for the past few years Prasa had been operating on a deficit budget.

Mgitywa added that once some employees take the packages, it wished to consider salary cuts to avoid retrenchments.

“If Prasa is not sustainable it will not be able to continue doing business. In order for it to be sustainable it needs to make more money than it spends.”

He said the packages would also be offered to managers.

Prasa services have been clapped since March due to the Covid-19 outbreak and they have not been operational since.

The Covid-19 outbreak came as Prasa was set on a financial recovery journey. Late last year Prasa’s board was dissolved and placed under administration due to a lack of financial management.

Transport Minister Fikile Mbalula said the trains would resume once government is satisfied with health and safety measures implemented by Prasa.

Millions of commuters depend on Prasa’s services. Trains are usually congested which is one of government’s fears as they might contribute to spreading the virus.

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