What does PRASA stand for? The Passenger Rail Agency of South Africa (PRASA) is a state-owned enterprise responsible for most passenger rail services in the country. It consists of four branches: Metrorail, which operates commuter rail services in urban areas; Shosholoza Meyl, which operates regional and intercity rail services; Autopax, which operates regional and intercity coach services; and Intersite, which manages the property owned by PRASA. PRASA Rail Operations continue to face major challenges which had a negative impact on the overall performance of the Group. Rail Operations experienced severe operational challenges during the period under review, characterised primarily by the decline in fleet availability. The main contributing factors were the dispute with Transnet about pricing of services and access to its network, unresolved contractual and pricing issues with companies involved in the refurbishment of coaches and supply of key components, as well as poor maintenance practices. The major problem remains the costs of running and maintaining South Africa’s rail system, which was no longer reliable and prone to daily breakdowns and failures. The costs have become significantly higher, yet the benefits to the economy and the country are quite limited. Regular disruptions of the current old system with its outdated technology and backward operational practices have impacted negatively on the quality of rail services, reliability of operations and financial performance. These costs keep on increasing, with Metrorail spending not less than R500 million annually on attempts at service recovery related to breakdowns and vandalism, rather than delivery of quality services. This situation was no longer sustainable and the modernisation of passenger rail had therefore become critical and could no longer be postponed. The acquisition of new, modern rolling stock and the signal technology upgrade were two key initiatives at the heart of the modernisation strategy of passenger railways in South Africa. A feasibility study had been conducted and 7 224 modern coaches were required over 20 years. A preferred bidder for the building of new passenger coaches would be announced in November with new coaches starting to run in 2014. A condition had been set that 65% of components must be manufactured in South Africa. About 65 000 jobs were expected to be created and local manufacturing of coaches would boost the number of skilled artisans. A BEE programme for the building of new coaches would be announced shortly. Prasa would invest R7 billion into a modern signalling system and Siemens had been appointed to carry out some of this work. Members were generally gracious with their remarks on the briefing but wished for more focus to be placed on the provinces and in particular rural areas which were suffering greatly from lack of access to transportation. Further meetings with relevant partners were recommended in light of the challenges in coordinating efforts to implement service reforms to the railway industry. There were three focuses within the presentation; the current state of the transport system, short-term (6-12 months), medium-term (12-24 months) and long-term (36+ months) strategies. PRASA was launched formally in 2009 in order to transform and consolidate all passenger rail companies in the country into a single entity. The primary objective of PRASA according to the Legal Succession Act was given as the provision of urban rail commuter services in the public interest as well as long haul passenger rail and bus services. Secondly PRASA was required to generate income from the exploitation of assets while giving due regard to the government’s socio-economic and transport objectives. PRASA was responsible for effectively developing and managing rail and rail related transport infrastructure while providing efficient rail and road based passenger transport within, and to and from urban and rural areas. Some of the major challenges to South African railways were the ‘end of the design’ lifespan for the entire railway system including infrastructure, technology, operating systems and staffing numbers. The deterioration of current rail technology was noted as were poor levels of reliability and the high costs of maintaining infrastructure. These factors led to a failure to contribute to an efficient transport system and to support economic development. This also caused limited access to socio-economic opportunities for the rural and urban poor. The current system required a major transformation and modernisation and could not continue in its present form. Recent remarks by President Zuma were echoed – that the poor state of the commuter rail system resulted in the inability to support economic development. The growth of the mini-bus taxi industry and transfer of freight from rail to road transport had further negatively affected the sustainability of the rail system. Railways in Europe and China were given as examples of well-functioning rail systems tailor-made to transport massive numbers of people and freight over specific transport corridors. Spain was noted as a country which had invested large amounts of capital into modernising and improving rail infrastructure and given as a possible model for South Africa. Mr Montana emphasised that 40 years of neglect had finally caught up with South African rail and there was a dire need for reform. No new coaches had been purchased for over 16 years except for the Gautrain and the majority of trains needed to be scrapped in haste as they presented a real security threat to passengers.