Prasa's debt issues: Law firm threatens to withdraw their services

Prasa's debt issues: Law firm threatens to withdraw their services

- South Africa's passenger rail agency is in deep debt and now a law firm wants to withdraw its services

- Prasa owes the agency a massive R9 million in unpaid fees for services delivered

- This amount excludes the services that have not yet been billed

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The Passenger Rail Agency of South Africa has a lot of debt that is causing some serious waves and problems for it.

A recent report by eNCA indicates that the agency has been failing to pay its debt and as such, a law firm wants to withdraw its services.

Cliffe Dekker Hofmeyr is owed more than R9 million, gathered, and this is just for the services already billed.

It's not clear what Prasa owes for services not yet billed by the law firm.

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The firm has claimed that Prasa promised to pay R500 000 in December but failed to do so. This is likely what prompted the threat to withdraw.

In addition to not being paid, the firm says it has also helped the passenger rail agency out in other ways.

Cliffe Dekker Hofmeyr paid payments on behalf of Prasa to the value of more than R2 million.

It was also reported that another law firm, Werksmans Attorneys, also plan to withdraw its services from Prasa. This firm is apparently owed roughly R19 million.

Earlier, Transport Minister Fikile Mbalula admitted that state-owned entity is a broken organisation.

The minister insists that a culture of impunity and poor leadership had all played a large role in sinking the agency.

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