The financial allocation to the Passenger Rail Agency (Prasa) for the upgrading of its automated signalling equipment has been cut by R7bn, as part of broader spending cuts triggered by a drop in projected revenue for the fiscal year.
In the third revision of the 2025/26 budget, presented by finance minister Enoch Godongwana on Wednesday, he noted that other proposed additions to spending allocated to Prasa over the medium term would be lowered, “in line with lower anticipated revenue.”
This follows the withdrawal of the one percentage point VAT increase that was initially proposed in the March 19 budget.
The allocations to signalling systems for the passenger rail entity have been revised down from R19.2bn in the March budget to R12.3bn in Wednesday’s budget. Over the medium-term, however, Prasa has been allocated R63bn, inclusive of the R12bn and R18.2bn for the rolling stock fleet renewal programme.
“The spending will sustain progress in rebuilding the infrastructure to provide affordable commuter rail services. This will enable Prasa to increase passenger trips from 60-million in 2024/25 to 186-million by the end of the medium-term expenditure framework (MTEF) period,” Godongwana said during his budget speech
“Access to safe, reliable and affordable commuter service is critical for low-income earners who spend more than 50% of their income on transport.”
The allocations are also expected to support Prasa’s drive to increase private participation in its rail network, with transport minister Barbara Creecy previously announcing that the department would release a request for information (RFI) for private sector participation in the passenger rail network in June
That initiative followed the RFIs on the five key rail and port corridors in the rail and port freight logistics sector. That information would be used by Transnet for requests for proposals, which Creecy said would be issued by August.
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