Sat, 19 Sep 2020

Autopax, the operator of Translux and City to City buses, won't be able to pay its employees full salaries for January, according a notice issued to staff.

The company blamed the setback on "serious operational challenges" which impacted cash flow.

"On Monday the 27th, we will unfortunately not be able to meet the full salary obligations for the month of January, and have managed.... to collect some funds from fare revenue to pay you 50% of what is due to you," read the notice seen by Fin24.

The balance will be paid at a date not yet confirmed, it said.

Prasa is a subsidiary of Passenger Rail agency of South Africa (Prasa), a state-owned entity which was last month placed under administration, amid claims of corruption and maladministration which threatened its viability.

Last week, Transport Minister Fikile Mbalula, whose department is responsible for Prasa, described the company as a "broken organisation, struggling to provide an efficient commuter and passenger rail service".

The Auditor-General's 2019 report found that the company regressed in its audit outcomes for 2018/19, and as much as R27.2bn was flagged as irregular expenditure.

The notice stated that Prasa and the Department of Transport were seized with turning around Autopax, in order to make it a functioning business. The bus company has joined a growing number of struggling state-owned entities, whose financial woes have threatened the payment of staff salaries.

This month, the Nuclear Energy Corporation of South Africa (NECSA) scrambled to meet January salaries, as cash flow challenges worsened. There were also fears that SAA, which is undergoing business rescue, would not be able to pay its workforce, but the problem was later resolved.

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