State-owned bus company is drowning in debt

Mayibuye Transport ‘had irregular expenditure of R5.7m’ this year

The provincial auditor-general and treasury are “seriously concerned” about Mayibuye Transport Corporation’s alleged R25m irregular expenditure, the standing committee on public accounts heard.

Eastern Cape auditor-general business executive Shereen Noble went as far as saying the state-owned bus company might not be able to carry on operating because of skyrocketing liabilities.

Noble stopped short of saying Mayibuye needed to be forensically investigated.

ANC MPL Mxolisi Dimaza asked whether it was premature for the AG to conduct a forensic investigation into the bus company.

Noble said the AG would wait until all the bus company’s internal investigations were complete to avoid repetition.

“They had irregular expenditure of R5.7m in the current financial year.

“They did not have any evidence of management for disciplinary actions they had taken against officials. There was also a finding on revenue collection – they’re not collecting revenue on time,” Noble said.

The Daily Dispatch reported last week that Mayibuye was on the brink of collapse, leaving thousands of commuters from East London to Komani stranded as almost half its fleet of 88 buses were not running. Mayibuye management acknowledged it had a cash-flow crisis.

Noble told MPLs that Mayibuye officials flouted supply management prescripts.

“Something we’re very, very concerned about is their financial sustainability and ability to carry on operations.

“Their current liability far exceeds the money they presently have,” said Noble.

Treasury corporate management deputy director-general Denee Cloete-Page said: “It would be remiss as provincial treasury if we didn’t raise the issue of growing concern knowing that treasury is not going to be able to give the budgets that we gave in the past in our now shrinking envelope.”

She said provincial treasury would be scrutinising Mayibuye’s revenue collection and base how it would fund the bus service on its ability to make a profit.

“A concise revenue collection and cost containment plan is necessary. Secondly, processes need to be put in place to start preventing irregular expenditure right up front. That will assist in swift management.”

Mayibuye chair Andile Mini and acting chief executive Khanyisa Gazi were lambasted by MPLs for failing to bring to Scopa any evidence of, among others, whether there was any investigation into the R25m lost through irregular expenditure.

Their presentation was rejected by MPLs because they had no evidence to back their claims, including that there was an investigation into the irregular expenditure. consequence

UDM MPL Mncedisi Filtane asked to give the “ill-prepared” board some reprieve and suggested they return at a new date and account to Scopa.

Transport MEC Weziwe Tikana-Gxothiwe thanked the committee for the second chance. Committee chair Veliswa Mvenya gave the board seven days to submit comprehensive reports to the committee. An irritated Mvenya told the executive: “This is Scopa. You bring evidence when you come here.”

This is Scopa. You bring evidence when you come here!

Veliswa Mvenya

Committee chair

Scopa