The Association of Private Security Owners of South Africa (Tapsosa) has accused the Passenger Rail Agency of SA (Prasa) of exploiting its service providers by failing to settle invoices on time.
The president of Tapsosa Jones Maphalaphathwa told African Voice Global that Prasa had mistreated security companies providing services at their Gauteng premises for the past five months by failing to settle invoices.
At least 10 companies and their employees now face the grim prospect of job losses, having received their last cheque from Prasa in October last year. Tapsosa said the companies, which have continued to provide services, are struggling to sustain their operations, a situation worsened by the ongoing lockdown.
“The situation is terrifying as some employers are unable to pay full salaries and are even contemplating closing shop. Our fear is there may be massive job losses in the industry unless companies access funding provided by the state,” said Maphalaphathwa.
Prasa spokesperson Makhosini Mgitywa denied they were squeezing out small to medium enterprises, saying they were making efforts to source the funds.
“Prasa is experiencing a cashflow crunch which is making us unable to pay our suppliers and creditors. It’s not a matter of being unwilling to pay, it’s a matter of being unable to pay,” said Mgitywa.
In November, the same companies won their case in the Western Cape High Court, which ordered that they go back on duty. Prasa had unlawfully terminated their contracts and were ordered to pay costs and pay the companies all monies owed to them following late payments.
“Our members are historically disadvantaged private security businesses who are constantly subjected to late payment of invoices, which continues to place a huge financial burden on their operations.
“The latter mostly emanates from a previously and still disadvantaged background. They have no additional financial resources or other means to secure additional funding other than relying on the revenue they receive when service has been rendered,” Maphalaphathwa said in a recent letter to Prasa.
He said they viewed Prasa’s action as victimisation.
“We urge you to pay our members with immediate effect and any further failure will result in us approaching the Minister of Transport for urgent intervention including, but not limited to, approaching the relevant court,” Maphalaphathwa wrote.