JOHANNESBURG – Transnet says that it is focused on the mammoth task of reviewing all its locomotive contracts, warning that the R8 billion it has already racked up in irregular expenditure could balloon even further.
In 2014, the rail agency signed four contracts valued at a collective R54 billion for the acquisition of 1,064 Chinese locomotives.
Transnet says that it is busy with a cleanup operation in line with President Cyril Ramaphosa’s directive that state-owned entities be turned around.
Transnet’s acting CFO Mohammed Mahomedy says that the parastatal is reviewing thousands of contracts as it tries to get to the bottom of the deep-rooted corruption in the company.
“If there are issues that have been confirmed around the irregularity and the legality of the 1,064 contracts, that has a bearing on what will be reported as an irregular expenditure.”
Mahomedy says that Transnet has already received about half of the locomotives from the four controversial contracts for 1,064 trains signed back in 2014.
He says despite a change of management last year, Transnet was still able to generate year on year growth of 3.5%.