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South Africa : PRASA's Corporate Real Estate depending on government subsidy of R20 MILLION.

PRASA's Corporate Real Estate Solutions (Cres) company is depending on the government subsidy of over R20 million a month to survive. PRASA's Corporate Real Estate Solutions is the entity charged with managing PRASA's extensive government owned property portfolio.

PRASA Cres's Performance Results for the month and quarter ended 30 June 2013 reveal that more than half the entity's revenue income consists of government subsidies - R69 million in just three months, to be exact.

Managing property on behalf of government should result in millions in profits. Instead, PRASA Cres is wholly dependent on continued government support and still managed to post a R34 million operating loss in just three months.

The DA will write to the Chair of Parliament's Portfolio Committee on Transport, Ruth Bhengu, asking her to summon Prasa Cres's CEO, Tara Ngubane, to appear before our committee and outline her plans to turn the situation around.

Continued government hand-outs to inefficient state-owned entities simply is not sustainable. Prasa Cres should explain why it is not turning profits and when it plans on being able to survive independently of its R20 million a month hand-out from government.

Scarce resources should be directed towards the delivery of basic services - not hand-outs to inefficient management companies.

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Publication:Mena Report
Date:Oct 21, 2013
Words:217
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