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PRASA sets sights on big recovery in passenger trips by 2030

1st December 2023

By: Irma Venter

Creamer Media Senior Deputy Editor

     

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Like many other State-owned entities, the Passenger Rail Agency of South Africa (PRASA) has had its share of scandals.

Its board chairperson was fired following an investigation into abuse of PRASA accommodation. And then there are those multimillion-rand payments to keep suspended senior managers at home and the thousands of ghost employees earning salaries at the rail agency.

However, PRASA is also quietly going about its business, reclaiming an increasing number of rail corridors countrywide following the Covid-19 pandemic, which saw its network almost completely destroyed by vandals and criminal syndicates, both inside and outside the agency.

Covid-19 perhaps also camouflaged the fact that the agency was already battling declining passenger numbers in the face of politicised management and the rising minibus taxi industry.

PRASA group CEO Hishaam Emeran, the former PRASA Technical CEO, has been with the agency for about 20 years, experiencing both its rise and fall.

So far, just more than a year into his new position, the PRASA team has managed to put some solid numbers on the table.

For one, following years of underexpenditure, PRASA, in the past financial year, managed to invest R13.5-billion in capital expenditure projects –the highest to date – exceeding its R12.9-billion allocated capital budget.

Going forward, the agency expects to spend R50-billion over the medium-term expenditure framework (MTEF) period, which, on average, will show an improvement of 22% a year over last year’s spend.

“We are not just rebuilding the passenger rail network; we are modernising the entire network in an ambitious and bold plan, and we intend to use the allocated budget to turn this vision into a reality,” says Emeran.

“Measures have been put in place to ensure that we increase our capital spend, including addressing challenges within our supply chain management and capital projects capacity.

“As part of the R50-billion capex spend, we anticipate spending R16-billion in this financial year and R34-billion in the next two years of the MTEF.”

Parliament’s Standing Committee on Appropriations earlier this year noted the “good performance” of PRASA, with the National Treasury saying it was “satisfied” with the progress made by the agency.

“Our capital projects will ensure that PRASA provides an efficient, safe, affordable, and modernised passenger rail service for the people of South Africa,” says Emeran.

“We are working towards positioning PRASA as the backbone of South Africa’s commuter network, offering an affordable mode of transport.”

Projects under PRASA capital programmes for the next four years include continued rolling stock modernisation, with new trains continuing to flow from the Gibela plant in Gauteng; countrywide depot modernisation; walling the rail reserve; station modernisation; perway infrastructure implementation; electrical infrastructure implementation; digitalisation; and signalling and telecommunications modernisation.

Emeran says the new blue trains that passengers are starting to see on the tracks – called electric multiple units (EMUs), or Isitimela Sabantu – will increasingly appear on the corridors being recovered following Covid-19.

The new trains have CCTV cameras, automatic doors and air conditioning. They can also travel significantly faster.

This is a major improvement on the old yellow-and-grey Metrorail trains. On these units, the doors could be easily forced open, for example, allowing passengers to jump on and off when and where they please, mostly without paying a fare.

The new EMUs can carry a maximum of 1 200 passengers each, with ticket prices mostly less than R10 for a single trip.

To date, 27 corridors of PRASA’s targeted 40 corridors are now operational, up from zero during Covid-19.

Emeran says the old Metrorail coaches are undergoing “refurbishment and heavy maintenance” under PRASA’s General Overhaul Programme.

“The yellow-grey coaches will complement the blue EMUs until a certain period when we’ll completely phase out these coaches, when they will serve as emergency backup trains.”

Bums on Seats and Money in the Bank
Prior to the Covid-19 pandemic, PRASA was transporting about 500-million passengers a year, says Emeran.

“To date, this year, we have transported just over 19-million passengers, with over 60-million passenger transported since the recovery of the corridors in 2021.

“We have a target of more than 500-million passenger trips a year by 2030, when we will have recovered all the passenger rail corridors, refurbished all the train stations, installed modern signalling, and increased the train frequencies.”

PRASA’s best-ever monthly performance was in 2008/09, at 54-million passenger trips, with 650-million trips a year recorded for 2009.

Revenue has been improving since the reclamation process started, while fare evasion has been declining, notes Emeran.

“Since we have reinstated the services after Covid-19, and with more lines recovered, we have seen a gradual increase in revenue from around R20 000 a month in April 2022, to an average of R20-million a month currently.

“This will accelerate quickly as new signalling systems are rolled out, reducing the time between trains during peak periods.

“We have seen a sharp decline in fare evasion, sitting at around less than 2% now,” adds Emeran.

“The new trains come with high-tech features to ensure we increase revenue, such as including automated doors, while we are also rolling out turnstiles at stations and ticket sales operators at our stations and inside the trains.”

Despite this, PRASA will continue to require a public transport subsidy from government, as it provides transport to poor households, with public transport aimed at this market subsidised by almost all governments worldwide.

“However, in achieving our set targets, we’ll see a decrease in this subsidy in real terms over the next six years,” says Emeran.

In 2021, PRASA received an operating subsidy of R8.8-billion, on top of its capital subsidy.

Emeran admits that PRASA’s revenue generation is not yet where it should be.

“We are not yet fully operational on many corridors – active, yes, but not fully operational – after the widespread theft and vandalism witnessed during Covid-19.

“The targeted fare revenue for the 2023/24 financial year is R161-million, compared with the R500-million we made in the 2019/20 financial year.

“We are confident that we will return to those revenue figures once we restore all planned passenger services and increase patronage,” says Emeran.

He adds that PRASA expects to be on a financially stable footing by 2030, in line with its projected rail recovery process.

“This will include a recovery in infrastructure that will drive passengers to return to rail. This depends, however, on the projected funding for infrastructure recovery and passenger fare revenue support remaining in place.”

Property Boon
PRASA’s secondary mandate is also set to serve as a steady income stream for the agency.

This mandate allows the agency to generate revenue from the assets it owns, including railway stations, land, as well as residential and office buildings.

“We are reshaping our stations,” says Emeran. “Our special-purpose vehicle, Intersite Assets Investments (Intersite), and property division, PRASA CRES, have entered into our very first co-investment agreement with Eris Property Group for a R1.2-billion mixed-use development project at the Cape Town Station, which will see 3 200 beds constructed at the station.”

PRASA expects to conclude similar investment agreements “soon” to bring in private property developers to unlock the value of PRASA’s real estate countrywide.

Other developments already in the pipeline include the development at the Goodwood Station, in Cape Town, which will see the construction of 1 055 affordable rental homes at the station.

PRASA leased its land around the station for the construction of the units.

Intersite is also co-investing with Urbane Living in a development in Braamfontein, Johannesburg.

The Rynx will see the conversion of PRASA’s existing Tippet building offices into 189 residential units at an estimated cost of R67-million.

Frequency Challenge
One surefire way to improve PRASA’s revenue and ridership is to increase the number of trains a day – especially during peak hours.

The market certainly exists, considering the increase in population in South Africa and the sharp uptick in urbanisation since those peak 2009 ridership numbers.

PRASA currently operates trains on manual authorisation, which acts as a severe drag on the system.

It is also currently mainly running trains during peak hours, and not nearly at full capacity. (This said, PRASA last month started offering off-peak discounts between 09:30 and 14:30, including to scholars in uniform, and pensioners, in an effort to encourage the public to use trains as an alternative mode of transport during off-peak periods.)

Manual authorisation means a train is given either written or verbal permission to pass the red robot, or signal.

Only one train can be authorised or given permission to move at a time.

For example, if signals are not working between Johannesburg and Doornfontein station, only one train can move from Johannesburg to Doornfontein before the second train may be given permission to move.

The person giving permission to the train driver is called the train control officer.

This system is slow and prone to human error.

While awaiting the roll-out of new signalling systems, PRASA aims to implement what it calls an Electronic Authorisation System (EAS).

This should reduce the chance of human error, as well as serve as a backup system once the full signalling system is activated.

This EAS, and the new signalling systems, should enable more trains to run, and to do so swiftly and safely.

“We have started on the resignalling programme in KwaZulu-Natal and Western Cape to restore the stolen and/or vandalised signalling equipment,” says Emeran.

“In the next three to five years, we should start seeing a gradual increase in train frequency and a sharp increase by 2027/28.

“For instance, we expect to increase the number of train trips to 139 000 a month in 2026 already.”

Emeran is also mindful that PRASA will only succeed if its passengers feel secure, and if the rail infrastructure and rolling stock are kept safe from criminals and vandals.

“We have over 10 260 internal and private security staff on the ground at our stations, platforms and inside the trains to increase the security of our passengers.”

Devolution?
A new National Rail Policy allows commuter rail devolution to competent local councils.

The City of Cape Town has repeatedly stated that it is eager to run its own rail service.

“The devolution issue is a policy matter under the purview of our shareholder, the national Department of Transport (DoT),” says Emeran.

“We are the implementing agency of the DoT, with a clear mandate to provide affordable passenger rail services.

“We are aware that the DoT is developing a devolution strategy in line with the National Rail Policy.

“But, as we wait for this to happen, we are recovering the network to a world-class standard as quickly as possible.”

Emeran says PRASA has already recovered ten out of 14 lines in the Western Cape.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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