Lease agreement changes between Ekurhuleni and PRASA to cost rate payers over R151m

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Lease agreement changes between Ekurhuleni and PRASA to cost rate payers over R151m

In 2014, PRASA (Passenger Rail Agency of South Africa) was given permission to use a portion of the Grootfontein Farm in Ward 88 in Nigel, for the purpose of manufacturing train coaches, now known as the PRASA Gibela project. PRASA had agreed on the condition that they will install their own bulk services, both internally and externally.

The reason not to install bulk services was not because the Ekurhuleni Metro did not have the money, but because it was going to be too expensive an exercise for the municipality to spend money on bulk services that were only going to benefit one client. Ekurhuleni has always been financially viable to finance its services, apart from the poor services caused by poor implementation.

It emerged at the August 3rd council meeting that PRASA has bullied some Heads of Departments.  Subsequently, the ANC brought into Council an item to change the previously agreed upon terms of the lease agreement, into making Ekurhuleni rate payers to foot the bill for their project. The bill will be over R151m!

The Democratic Alliance (DA) in Ekurhuleni will not be bullied into abusing rate payers’ money. Especially because bulk services for this project are meant to be paid for by the Presidential Infrastructure Development Programme. Furthermore, PRASA was given the first 24 months of construction rent free, on condition that they will foot their own bulk services bill.

It is unseemly of PRASA to take occupation of the land and then bully the Municipality into spending over R151m on services that will only benefit them. The DA cannot allow rate payers to be abused in this manner, particularly because PRASA agreed to the terms of the lease from the onset.

The Metro cannot spend this enormous amount of money, only to benefit PRASA. This money can be used to upgrade the storm water drainage in Katlehong, or to upgrade the electricity grid at Leondale or install the much needed services at Mgababa.

The DA in Ekurhuleni will not allow for this wasteful expenditure to take place!

Lease agreement changes between Ekurhuleni and PRASA to cost rate payers over R151m