Latest news with #BarbaraCreecy
IOL News
2 days ago
- Business
- IOL News
Government approves R94. 8bn guarantee to bolster Transnet's finances
This decision made on Friday comes as a part of the government's ongoing efforts to support Transnet's operational stability amid mounting challenges posed by credit downgrades and economic volatility. The government has approved an additional R48.6 billion guarantee for Transnet, ensuring that the entity can cover all debt redemptions over the next five years and maintain adequate liquidity levels. This decision made on Friday comes as a part of the government's ongoing efforts to support Transnet's operational stability amid mounting challenges posed by credit downgrades and economic volatility. The newly approved R48.6bn guarantee follows an earlier allocation in May, which saw the government approving R51bn in guarantees, including R41bn aimed at funding requirements for the 2025/26-2026/27 fiscal years and R10bn designated for liquidity management purposes. The total financial backing for Transnet now amounts to R94.8bn, what the Department of Transport said was a testament to the government's commitment to restoring the financial health of the embattled entity. Transnet, which plays a crucial role in the logistical backbone of the country, has been grappling with operational inefficiencies and financial strain exacerbated by credit rating downgrades. These downgrades have not only affected the company's access to capital but have also heightened the risk associated with its existing debt obligations. Recognising these challenges, the government has allocated an additional R46.2bn to mitigate the risks from potential further negative credit actions, thereby seeking to safeguard the company's financial future. In her announcement last month, Transport Minister Barbara Creecy indicated that the government was committed to working closely with Transnet to ensure both operational and financial improvements. This initiative is part of a broader strategy aimed at accelerating reforms within the logistics sector, which includes encouraging private sector participation to enhance efficiency and productivity. This latest financial intervention is critical in ensuring that Transnet can continue to operate effectively while implementing necessary reforms. The government's steadfast support reflects its recognition of the vital role Transnet plays in South Africa's economy, responsible for moving goods across vast distances and supporting numerous industries. BUSINESS REPORT
The Citizen
2 days ago
- Business
- The Citizen
Transnet bailouts? Government bends with R94.8bn more in guarantees
It will ensure all the group's debt redemptions are covered for the next five years and mitigate the risk of credit downgrades on its existing debt, says the Transport Department. The further state support comes as international ratings agencies have in recent months either downgraded Transnet's credit rating or warned that it is running out of cash. Picture: Supplied Government has approved additional guarantee support of R94.8 billion for struggling state-run ports and rail group Transnet. On Friday the government approved an additional R48.6 billion guarantee for Transnet, to ensure that all debt redemptions will be covered over the next five years and the transport entity will maintain sufficient liquidity levels, according to the Department of Transport (DoT) on Sunday. This comes as international ratings agencies have either downgraded Transnet's credit rating or warned that it is running out of cash in recent months. The DoT added that the government had considered the impact of the credit downgrades on Transnet's existing debt and therefore also approved R46.2 billion for it to mitigate the risks of such ratings actions on its debt. This additional 'guarantee support' for Transnet follows government's approval of an allocation of R51 billion in guarantees to Transnet on 22 May 2025. That allocation comprised R41 billion for the funding requirements for the 2025/26 and 2026/27 financial years and R10 billion for liquidity management purposes. The latest additional guarantee support for Transnet follows Minister of Transport Barbara Creecy's announcement on 12 June 2025 that the government had initiated a process to allocate additional guarantees to Transnet. ALSO READ: S&P Global exposes Transnet's operational crisis as it fails to meet targets Creecy said at the time the government had initiated this process given Transnet's debt redemptions, over its five-year corporate plan period of R99.6 billion, and to at least cover the entire redemptions over the corporate plan period. She said this support from government will allow Transnet to ensure: That all debt redemptions will be covered over the next five years. The execution of its capital investment programme. Short-term liquidity risk is adequately mitigated. Creecy added that the government is determined to work with Transnet over the corporate plan period to focus on structural solutions to improve its capital structure to reduce its debt levels. She said the government will monitor Transnet's performance to ensure it provides adequate support as Transnet implements government's required reforms. The DoT said on Sunday the government will also continue to work with Transnet to ensure operational and financial improvements in the company and to accelerate implementation of reforms for the logistics sector, including private sector participation. ALSO READ: Creecy punts private sector investment for five rail and port corridors Creecy told the Southern African Transport Conference earlier this month that her department had just concluded a request for information (RFI) process to guide private sector investment in its five-priority rail and port corridors. She stressed that the limited availability of state resources to fund infrastructure development makes private sector investment critical. Speaking on the sidelines of the conference, Creecy said there had been 'an excellent response' to the RFI, with almost 163 submissions. 'We are now processing those submissions so that Transnet can begin the formal procurement process at the end of August 2025, through the issue of requests for proposals,' she said. Creecy said the DoT will at the end of this month release the second batch of the RFI, which will be focused on passenger rail initiatives. ALSO READ: R26 billion rescue from World Bank: Can the loan save Eskom and Transnet? Infrastructure funding She said funding sources for immediate rehabilitation of the five priority rail corridors include the current Transnet budget for rail and rolling stock maintenance and purchase of port equipment, submissions to the National Treasury's Budget Facility for Infrastructure, and private investment in refurbishing or expanding line capacity through existing customer agreements. Creecy said Transnet itself makes annual allocations for maintenance, but this is insufficient, and they have also put in an application to the Budget Facility for Infrastructure. Overall, it will be applying for more than R30 billion. 'This would allow us to do maintenance and to buy equipment for the rail corridors and also in the ports,' she said. The minister noted that there are two tranches: the July window application is already in, while they are still working hard on preparing the application for the October window. ALSO READ: Government delivers R51 billion support to Transnet. Will it last? 'We won't be able to do all of the ports and corridors all at once, but we will be doing so incrementally as we process the information. 'What we can look forward to is some major investment in our rail corridors and also in our ports. Obviously, it's going to take our infrastructure to a different level moving forward,' she said. Four of the six targets that Creecy highlighted in her Budget Vote speech in Parliament earlier this month are to: Ensure by 2029 that Transnet moves 250 million tons of freight on its network each year. Improve the speed at which ships are loaded and unloaded in South Africa's ports to the international benchmark of 30 gross crane movements per hour. Ensure the passenger rail system provides safe, reliable and affordable transport to workers and their families, with the aim of ensuring 600 million passenger journeys a year by 2030. Move 1.2 million tons of airfreight a year through the Airports Company of South Africa network of airports by the end of this political term. This article was republished from Moneyweb. Read the original here.
Eyewitness News
2 days ago
- Business
- Eyewitness News
Transnet will receive R94.8 billion from Transport Department over next 5 years to help manage mounting debt
JOHANNESBURG - Transnet will receive R94.8 billion in financial support from the Transport Department over the next five years to help manage its mounting debt. The Department said the additional guarantees will cushion the impact of recent credit rating downgrades, to mitigate risks and ensure Transnet can meet its debt obligations. This latest support follows a R51 billion guarantee approved earlier this year by Transport Minister Barbara Creecy and Finance Minister Enoch Godongwana. Department spokesperson Collen Msibi said the new allocation will help stabilise the entity's financial position. 'On the 12th of June 2025, the Minister of Transport, Ms. Barbara Creecy, announced government has initiated a process to allocate additional guarantees to Transnet. As a result, government has, on 25 July 2025, approved an additional R48.6 billion guarantee for Transnet to ensure that all debt redemptions will be covered over the next five years. '
IOL News
3 days ago
- IOL News
Grenade saga: ACS accuses ACSA of having blocked critical screening upgrades at OR Tambo Airport.
Aviation Coordination Services (ACS) has hit back at Airports Company South Africa (ACSA) Image: File Aviation Coordination Services (ACS) has hit back at Airports Company South Africa (ACSA), accusing it of having blocked important upgrades to baggage screening equipment at OR Tambo International Airport. This comes after a passenger managed to board an Ethiopian Airlines flight from Johannesburg on May 25 with two training grenades in their checked luggage, only for the items to be discovered upon arrival in Addis Ababa. The company also denied that ACSA has the right to terminate its "provision of services" for hold baggage screening at the airport, adding that it has been providing hold baggage screening at the airport for over 25 years and is the legally approved service provider. However, ACSA disputes this claim, arguing that ACS operates without a valid contract and is in breach of procurement laws. In 2023, ACSA decided to insource the hold baggage screening (HBS) function, but was temporarily blocked by a court interdict obtained by ACS. According to the company, the matter is now set for mediation under the Minister of Transport, Barbara Creecy. ACS said that the recent security breach involving training grenades was due to human error, but could have been avoided if ACSA had permitted upgrades to the screening equipment. "For the past eight years, ACSA has prevented ACS from replacing HBS equipment at airports with more advanced and reliable screening technology. "Had ACS been permitted to carry out the long-term HBS equipment upgrade and replacement, the security incident that took place on 25 May may well have been avoided," the company said. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ ACS also claimed that "as a result of ACSA's refusals to allow it to replace the HBS equipment, ACS had to resort to bringing several urgent proceedings before the High Court in an attempt to force ACSA to permit the interim replacement of Level 3 back-up machines". "ACS was successful in these proceedings and obtained three consecutive court orders against ACSA between November 2024 and May 2025". However, ACSA described this claim as "factually incorrect," stating that any replacement of HBS equipment must be approved by the South African Civil Aviation Authority (SACAA). ACSA added that SACAA has previously communicated to ACS that it lacks the authority to replace HBS equipment, as ACS is not an airport operator. "ACSA had issued a tender worth approximately R3.1 billion for the replacement of the entire HBS equipment. However, ACS obtained an interdict blocking ACSA from adjudicating the tender until the court's review of ACSA's decision to insource," ACSA said. ACS also accused ACSA of delaying notification of the incident by 10 days, which slowed their investigation. "Our investigation confirmed that the items were 'Free From Explosive' (FFE) grenades, which are deactivated and used for training purposes and are safe for transportation. While the suspicious baggage was detected at Level 1 and Level 2 screening points, it was mistakenly cleared by a screener at Level 3". In response, ACSA said that Ethiopian Airlines sent communication regarding the incident to an ACSA employee who was not the designated official as stipulated in the regulatory reporting arrangement, and "as a result, the communication was not immediately brought to the attention of the designated official". "When the designated official was made aware, the matter was immediately reported to SACAA, and ACS was notified. The issue of the delayed reporting is being investigated, and appropriate action will be taken". ACSA said. "While the matter of the delayed reporting is being addressed, this should not detract from the fact that the reason for the occurrence of the incident, which is negligent human error, took place under the watch of an unregulated and unlawful operator". ACS added that it has "zero tolerance to any form of security breach and deems this incident as gross negligence by the screener, hence this led to the dismissal". IOL Business Get your news on the go, click here to join the IOL News WhatsApp channel
The Star
4 days ago
- Politics
- The Star
Fierce backlash against proposed Road Accident Benefit Scheme Bill following RAF board dissolution
The Department of Transport's move to revive the long-rejected Road Accident Benefit Scheme (RABS) Bill has sparked concerns, following Minister Barbara Creecy's announcement that she has dissolved the Road Accident Fund (RAF) Board due to ongoing governance and operational failures. Creecy, who recently took over the transport portfolio, said the dissolution was necessary to stabilise the RAF and restore its ability to fulfil its mandate. She also confirmed the department's intention to finalise the Road Accident Benefits Scheme (RABS) Bill, a move that various organisations say is both undemocratic and dangerous. The department explained that the RABS Bill seeks to replace the current fault-based compensation model with a no-fault system, removing the need for costly legal processes. Civil society organisations, legal experts, and advocacy groups, many of whom have fought against the bill for years, have condemned its reintroduction. Among them is the Association for the Protection of Road Accident Victims (APRAV), which warned that pushing the bill forward again is a direct affront to democracy. 'Parliament has rejected RABS three times already,' said APRAV Deputy Chairperson and spokesperson Ngoako Mohlaloga. 'The continued attempt to revive it is either deliberate ignorance or a strategic attempt to bypass the will of the people.' APRAV Chairperson Pieter de Bruyn said the bill was rejected not only by lawmakers but also by road accident victims, legal professionals, disability rights groups, and medical experts. 'RABS would have stripped victims of their right to legal recourse, capped compensation, and imposed rigid limitations,' he said. 'It was unworkable and unjust, and its continued reappearance shows this is about pushing a political agenda, not real reform.' APRAV also pointed out that it led a two-year national consultation process that resulted in a credible and workable alternative to RABS, one that would fix the RAF without violating constitutional rights or collapsing the public purse. Legal expert Kirstie Haslam, a personal injury attorney and partner at DSC Attorneys, told Independent Media that the RABS Bill fails to tackle the real problems at the RAF, namely, poor management, inefficiency, and lack of accountability. 'RABS replaces a broken system with another flawed one,' Haslam said. 'It doesn't fix the root causes of RAF's dysfunction, and worse, it strips victims of access to justice by capping payouts and removing the right to claim for general damages.' She also added that the bill's attempt to limit legal oversight raises serious constitutional concerns and could face court challenges if passed in its current form. Haslam further highlighted troubling trends in the RAF's finances, which, although improved, have come at a cost. The RAF's 2023/2024 annual report shows the deficit has dropped from R8.43 billion to R1.59 billion, but partly due to reduced medical and loss-of-earnings payouts. Despite the tightening of spending, courts continue to issue significant awards. She revealed a series of recent payouts, such as in April, when a woman received over R4.6 million following the death of her husband in a motorcycle accident. That same month, another claimant, Seronica Nathram, was awarded nearly R3.9 million for injuries sustained in a crash. Another case involving the Road Accident Fund that commanded attention involved 16-year-old Ashwell Bernard Jones, where the Western Cape High Court awarded Jones just under R4,979,832 for future loss of earnings. He was only eight years old when he sustained a serious brain injury after being hit by a vehicle while riding his bicycle in Lavender Hill in 2017. The court ordered the RAF to cover all legal costs, including expert fees, travel expenses, and the possible appointment of a curator to manage the funds. The RAF was given 180 days to make payment, or interest will begin to accrue. While many groups remain opposed to the revival of RABS, the Congress of South African Trade Unions (COSATU) has backed the minister, calling the RAF a 'disaster site' with liabilities exceeding R400 billion. 'The RAF has become dysfunctional and has failed working-class South Africans for too long,' COSATU said in a statement. 'It's time for bold reform.' Responding to questions, the RAF Head of Corporate Communications, McIntosh Polela, said the RABS Bill is being revisited to address longstanding issues in the current RAF Act. 'The RABS Bill aims to reduce litigation, cut high administrative costs, and accelerate claim finalisation,' the fund said. 'It is part of a broader strategy led by the Department of Transport to ease the pressure on the courts and better serve road accident victims.' [email protected] Saturday Star
