The Standing Committee on Public Accounts (SCOPA) has expressed concern over the ongoing dispute between Transnet and Chinese locomotive supplier CRRC E-Loco, which is significantly impacting Transnet’s financial stability. During a recent meeting with the Minister of Transport, Ms Barbara Creecy, and Transnet executives, SCOPA discussed Transnet’s 2023/24 audit outcomes, where Transnet received an unqualified audit opinion but faced compliance issues.
The impasse with CRRC E-Loco has led to a severe shortage of locomotives, hindering Transnet Freight Rail’s operations and contributing to rising debt. Transnet’s Group CEO, Ms Michelle Phillips, highlighted that despite purchasing 1,064 locomotives, many assets have not been integrated into the system, resulting in financial strain due to ongoing loan repayments without corresponding operational benefits.
Additionally, Ms Phillips pointed out that the theft of cables and signalling systems has compounded the debt issue, with revenue losses of approximately R2.1 billion reported for the 2023/24 financial year. Cable theft incidents have surged from 1,709 in 2016/17 to 4,411 in 2023/24. Transnet’s debt has increased from R122 billion in 2017/18 to R130 billion in 2022/23, exacerbated by the unresolved dispute and operational challenges. SCOPA’s Chairperson, Mr Songezo Zibi, emphasised the urgent need to resolve these issues to prevent further financial deterioration.
