The Passenger Rail Agency of South Africa’s Board of Control has unanimously agreed to terminate the secondment of Acting Group CEO Collins Letsoalo with immediate effect.
The dismissal comes after reports that the Acting Group CEO authorised a salary hike irregularly.
This comes after the controversy behind the remuneration package of Letsoalo in which he is accused of hiking his salary by 350% from R1.3-million to R5.9-million, demanding a chauffeur-driven vehicle and a company cellphone with unlimited calls just like former boss Lucky Montana.
Letsoalo was seconded to PRASA by Transport Minister Dipuo Peters in July last year, to turn the agency’s fortunes around after it bled R13.9-billion because of irregular contracts.
In a statement, the board of PRASA said it viewed these allegations against Letsoalo “in a dim light”.
“The PRASA board would like to place on record that that no board resolution was adopted regarding such a salary increase nor payment of an annual salary package of R5.9-million,” PRASA said in a statement.
“In fact, the agreed and official salary remains the R1.3-million annual package which was approved by the Minister of Transport as the terms of the secondment package which were agreed upon by Mr. Letsoalo.”
Letsoalo called a media briefing earlier on Monday where he produced a letter of his appointment and email correspondence with general manager of remuneration and benefits, Bongani Nkomo, to support his argument that he was entitled to all benefits of the chief executive.
PRASA said that all matters pertaining to the alleged authorisation of the salary hike by the chairman of the board in a letter was part of the considerations on the extent of Letsoalo’s added duties at PRASA during his secondment period.
“This letter did in no way give an automatic authorisation of a salary increase without following due process as clearly stated in the letter from the chairman of the board,” PRASA said.
“The PRASA remuneration policy on acting positions provides for an increase not exceeding 12 percent of the package on the acting position.”
According to PRASA’s human resource (HR) policy relating to group chief executive salary packages, it is the prerogative of the human capital and remunerations committee to recommend such changes and communicate such to the human resource executive concerned.
PRASA said this was not done in the case of Letsoalo, “subsequently flouting all procedures and protocols in this regard and leaving the board with no choice but to terminate his temporary tenure with immediate effect”.