PRASA
By Mpho Moloi
The South African Transport and Allied Workers Union (SATAWU) and the United National Transport Union (UNTU) have declared a dispute with the Passenger Rail Agency of South Africa (PRASA) after wage negotiations for the 2025/26 financial year reached a deadlock. The unions are demanding a “15% wage increase” across the board, alongside other benefits like a “R3,000 housing subsidy” and a “no-retrenchment clause,” which PRASA says it cannot afford due to its well-documented financial struggles.
Wage Talks Collapse for the Third Time
Negotiations between PRASA and the unions kicked off earlier this year, with the latest round—the third attempt—taking place this week. Despite hours of discussions, no agreement was reached. SATAWU and UNTU presented a united front, laying out a list of demands they say are critical to improving the lives of PRASA’s workforce. These include:
• A “15% wage increase” for all employees.
• A “R3,000 housing subsidy” to help workers cope with rising living costs.
• A “standby shift and night shift allowance” to compensate for tough working hours.
• A medical aid subsidy, with PRASA footing “70%” of the premiums, leaving workers to pay the remaining “30%.”
• A “no-retrenchment clause” to protect jobs throughout the agreement period.For PRASA, these demands are a tall order. The state-owned enterprise (SOE) has been battling financial instability for years, a situation laid bare by the auditor-general’s report showing “R3.8 billion” in irregular expenditure for the 2022/23 financial year. Management argues that double-digit wage hikes are simply not possible without sinking the company deeper into debt.
Unions Push Back: Workers Shouldn’t Pay for PRASA’s Problems
The unions aren’t backing down. UNTU spokesperson Atenkosi Plaatjie slammed PRASA’s position, calling its claim of unaffordability “another attempt to negotiate in bad faith.” He argued that workers shouldn’t be the ones to suffer for the rail operator’s financial mismanagement. “Our members are facing their own hardships,” Plaatjie said. “They deserve fair pay and decent conditions, not excuses.”
SATAWU echoed this sentiment, pointing to South Africa’s high cost of living. Inflation, hovering around 6.5% in early 2025 according to Statistics South Africa, has eaten into workers’ salaries. Housing costs, especially in cities like Johannesburg, Cape Town, and Durban where many PRASA employees live, have soared, making the “R3,000 housing subsidy” a key demand. The unions say these benefits aren’t luxuries—they’re necessities.
PRASA’s Financial Woes: A Deepening Crisis
PRASA’s financial troubles are no secret. The auditor-general’s report didn’t just flag “R3.8 billion” in irregular spending—it also pointed to R500 million in fruitless and wasteful expenditure and a balance sheet where liabilities outstrip assets by R2 billion. Years of mismanagement, corruption scandals, and underinvestment have left the rail agency limping. The COVID-19 pandemic made things worse, slashing passenger numbers and revenue as lockdowns kept commuters at home. Even now, ridership hasn’t fully bounced back, leaving PRASA cash-strapped.
Management insists that meeting the unions’ demands would push the company over the edge. A “15% wage increase” alone could cost hundreds of millions of rands annually, money PRASA says it doesn’t have. The “no-retrenchment clause” is another sticking point—restructuring, which might involve job cuts, has been floated as a way to cut costs and improve efficiency.
Next Stop: The CCMA
With talks at a standstill, the dispute is now headed to the Commission for Conciliation, Mediation and Arbitration (CCMA). This independent body, set up under South Africa’s Labour Relations Act of 1995, steps in to resolve workplace conflicts. Mediation is the first step, where a CCMA commissioner will try to broker a deal between PRASA and the unions. If that fails, the matter could move to arbitration, where a binding decision would be made. Alternatively, the unions could call for a strike, but only after following legal steps like balloting their members.
The CCMA has scheduled mediation for 10 April 2025. Until then, PRASA services will run as normal, but the possibility of industrial action looms large if no agreement is reached.
A History of Wage Battles at PRASA
This isn’t PRASA’s first rodeo with wage disputes. Back in 2018, UNTU members downed tools, bringing rail services to a halt for days. Commuters were left stranded, and the economy took a hit. More recently, in 2023, negotiations dragged on for months before settling on a 5% wage increase—a far cry from the “15%” now on the table. These past clashes show how tricky it is to balance workers’ needs with PRASA’s shaky finances.
Across South Africa’s public sector, wage talks often follow a similar pattern. Unions push for above-inflation raises to keep up with living costs, while cash-strapped SOEs and government departments cry foul over budgets. PRASA’s case stands out because of its critical role—and its equally critical financial state.
Why the Demands Matter
Let’s break down what the unions are asking for and why it’s a big deal:
• “15% wage increase”: With inflation at 6.5%, workers say a double-digit hike is the only way to stay ahead. PRASA counters that even a smaller increase would strain its budget.
• “R3,000 housing subsidy”: Property prices and rents have skyrocketed, especially in urban areas. For workers earning modest salaries, this could mean the difference between a decent home and cramped living conditions.
• “Standby shift and night shift allowance”: Train drivers, maintenance crews, and others often work odd hours. These allowances would reward them for the extra effort.
• Medical aid subsidy (“70%” from PRASA): Healthcare isn’t cheap, and workers want PRASA to shoulder more of the burden so they can afford proper coverage.
• “No-retrenchment clause”: Job security is a top worry. With PRASA’s finances in tatters, workers fear layoffs could come any day.Each demand reflects the real struggles of PRASA’s roughly 15,000-strong workforce—drivers, technicians, cleaners, and more—who keep South Africa’s commuter trains running.
Commuters Caught in the Crossfire
If this dispute turns into a strike, the biggest losers could be PRASA’s passengers. Metrorail, PRASA’s commuter rail arm, serves millions every year, especially low-income workers in cities like Johannesburg, Cape Town, and Durban. A shutdown would force people onto buses, taxis, or private cars, driving up costs and clogging roads. During the 2018 strike, some commuters missed work entirely, hurting their own livelihoods.
Even without a strike, the uncertainty could dent confidence in PRASA. The agency has been working to rebuild its reputation after years of unreliable service, broken trains, and vandalised infrastructure. A labour standoff might set those efforts back.
The Economic Ripple Effect
PRASA isn’t just about getting people to work—it’s a lifeline for the economy. The rail network moves goods too, supporting industries like mining and manufacturing. A prolonged dispute could disrupt supply chains, delay projects, and cost jobs elsewhere. As a major employer itself, PRASA’s financial health affects thousands of families, plus the suppliers and contractors it works with.
South Africa’s economy is already on shaky ground, with sluggish growth and unemployment stuck above 30%. Rising inflation has squeezed households, making wage hikes a hot-button issue. For unions, it’s about fairness. For PRASA, it’s about survival.
The Government’s Role: A Tough Spot
PRASA falls under the Department of Transport, and the Transport Minister has stayed quiet so far. But pressure is building for the government to step in. As a Schedule 3B public entity, PRASA is meant to be self-sustaining, but it’s leaned on state bailouts before—billions of rands to cover debts and fix tracks. With the national budget stretched thin, more cash might not be an option this time.
Opposition parties have jumped on the dispute to slam the government’s handling of SOEs. They argue that PRASA’s mess—along with troubles at Eskom and Transnet—shows a failure to fix systemic issues like corruption and poor planning. For now, all eyes are on whether the minister will weigh in or leave it to the CCMA.
What’s Next for PRASA and the Unions?
The CCMA mediation could go a few ways. A compromise might see the unions drop their “15%” demand to, say, 8%, with PRASA offering smaller perks instead of big cash commitments. If talks collapse, a strike could start within weeks, assuming the unions follow the legal process. Arbitration is another route, though it’s slower and leaves the outcome to a third party.
For commuters, workers, and taxpayers, the stakes are high. A quick fix would keep trains running and paycheques flowing. A drawn-out fight could derail more than just the rail service—it could deepen PRASA’s crisis and test the government’s resolve.
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