Former acting Prasa CEO Collins Letsoalo has been dubbed Mr 350%. File photo: Phill Magakoe/Independent Media
Parliament – Parliament's portfolio committee on transport on Wednesday decided on establishing an inquiry into the problems at the troubled Passenger Rail Agency of South Africa (Prasa).

"After two days of deliberations, the Committee still did not have a sense of whether Prasa will be saved. It is important that Prasa works if we are to grow the economy and deliver on the mandate to get poor South Africans to work," said committee chairwoman Dikeledi Magadzi.

"As things are now, there is no sense that the board is in control of anything. It does not seem that there are controls at the entity to ensure good governance in line with legislation. That said, the Committee is of the view that the entity could still be saved."

During the same meeting on Wednesday, acting department of transport director-general Mathabatha Mokonyama read out a shock notice from his Minister, Dipuo Peters, announcing that she was dissolving the board "with immediate effect".

This followed a heated two days of hearings with transport officials, the board and Collins Letsoalo, whose secondment from the department to Prasa as acting group chief executive was ended after it emerged that he had been given a 350 percent increase, hiking his salary to R5.9 million. Letsoalo denied he had hiked his own salary and complained that he was now being called "Mr 350 percent", insisting he had been told the salary was what he was entitled to.

Board members differed and the two sides accused each other of lying. He claimed he was removed from Prasa because he had begun questioning board decisions. MPs were not impressed, given that Prasa was the single biggest contributor to irregular expenditure in South Africa.

Last year, the auditor-general said the state-owned rail company had incurred irregular expenditure to the tune of R13.9 million.

ANC and EFF MPs blamed the board for the financial mess at Prasa – which was hindering Prasa from fulfilling its mandate to provide adequate train services to South Africans. They went as far as calling board members corrupt and saying the "board must fall".

Magadzi on Wednesday said the committee would decide on the terms of reference and composition of the inquiry. "Representatives and officials should at all times seek to be of use to the poor people we are meant to serve. Prasa is spending public funds resolving disputes and fighting among officials and, in the meantime, delivery to the people is suffering," she said.