Gigaba only removed Myeni from the SAA Board because he was forced to do so

Please find the attached soundbites in IsiZulu and English.
It is clear that Finance Minister, Malusi Gigaba, only removed Dudu Myeni from the SAA Board because he was forced to do so by the people who have lent SAA money. Lenders to the airline would not extend their loans to SAA.
The airline is bankrupt and needs R10 billion in order to continue trading until the end of the current financial year. Gigaba is not a knight in shining armour.
The restructuring of the Board will not save SAA. The airline simply cannot be saved.

Myeni approached PIC for R6 billion for SAA

The DA has noted the media report that Ms Dudu Myeni has asked the Public Investment Corporation (PIC) for R6 billion to bail out beleaguered South African Airways (SAA), an airline that she has basically run into the ground.
While the PIC reportedly refused these requests this is yet another reason, to add to the mountain of reasons to remove Myeni. She now appears to be involved in the planned raid on pensioners’ money to prop up SAA and other bankrupt State-Owned Enterprises.
PIC boss, Dan Matjila, apparently had to answer to allegations against him that were mysteriously apparently leaked after he turned down Myeni’s request. It’s concerning that Matjila is apparently unable to do his job without political interference.
The Minister of Finance, Malusi Gigaba, is dead wrong. The presence of Ms Dudu Myeni on the SAA board at all, let alone as Chair, is neither a legal requirement nor is it prudent. In fact, it is downright irrational and completely irresponsible of Gigaba to try to find technical means to retain Myeni on the SAA board.
SAA has been in constant need of rescuing, facing a R10 billion funding crisis in a few days’ time. The setbacks for SAA continue to pile up:

  • Citibank has reportedly refused to extend their R 1.8 billion loan beyond the 30th of September 2017;
  • The balance of the lenders of the R 6.8 billion due for payment by the 30th of September 2017 has apparently indicated their reluctance to extend their loans particularly if Myeni remains on the SAA board;
  • The international ratings agencies are watching how Gigaba handles the SAA crisis very closely; and
  • There is no time left for any special appropriation bill to be passed by Parliament before the 30th of September 2017.

With Matjila facing an internal audit for doing his job, it’s difficult to have faith in the PIC when the politically connected seek access to the R1.9 trillion of pension money that Matjila manages to further enrich themselves. It’s unethical to use the citizens’ hard-earned pension funds to rescue the failing SAA, once again.
Despite all this, Gigaba is prepared to put the economic future of South Africa, and the 9.3 million unemployed South Africans, at risk in order to comply with the wishes of President Jacob Zuma to keep his close friend Dudu Myeni on the SAA board.

Gigaba cannot ignore the facts any longer – Dudu must go

The DA welcomes the intervention of the Companies and Intellectual Property Commission (CIPC) which confirms our view that the Finance Minister, Malusi Gigaba’s, decision to extend Dudu Myeni’s term as Chair of South African Airways (SAA) board, was illegitimate.
Accordingly, we are also of the belief that Ms Myeni is technically no longer the chair of the board and that any board decisions taken since the 1st of September 2017 must be viewed as irregular and unenforceable.
Minister Gigaba has failed to take the robust action that is required to save SAA and stop the ongoing losses and consequent taxpayer bail outs. SAA is a complete shambles and the Minister’s failure to remove one of the main obstacles to progress at the airline shows that SAA is clearly not a priority for Minister Gigaba.
The intervention of the CIPC in the extended appointment of Ms Myeni will be useful to the Standing Committee on Finance in dealing with its resolution that requests that Minister Gigaba review his decision to extend the appointment and to provide the basis on which he made the decision.
When all is said and done, Minister Gigaba must be held accountable for the evidently illegal decision to extend the appointment of Ms Myeni as the SAA board chair and more importantly, for the billions in losses as well as that funding crisis that has been allowed to continue at SAA.

Myeni failed to hand over reports on SAA corruption to Parliament

Yesterday, I was informed by the Chairperson of the SAA Board, Dudu Myeni, after the disastrous meeting of Parliament’s Finance Committee, that she had in her possession copies of forensic investigation reports into SAA, yet failed to table them before the committee.
The DA will today write to the Minister of Finance, Malusi Gigaba, and his Deputy, to demand that the investigation reports be tabled in Parliament immediately.
There can be no further delays particularly if the reports confirm the SA Cabin Crew Association’s (SACCA) allegations of widespread corruption at the national carrier.
For 7 months the DA has been requesting these reports. However, National Treasury has refused to hand them over. Last month, the Deputy Minister of Finance, Sfiso Buthelezi, promised to release these reports to the finance committee, he has failed to make good on this promise.
Given the accusations of corruption that Myeni has recently alluded to – which coincidently was highlighted by SACCA immediately after Myeni appeared before Parliament – the DA finds it surprising that Myeni did not inform the finance committee that she had, apparently in her briefcase, investigation reports which expose the corruption she referred to.
These reports include, but are not limited to:

  • An investigation into the sale of surplus materials such as rotables and consumables;
  • An investigation into SAA Technical with respect to Commercial aircraft leases between SAA and Mango;
  • Investigations into various allegations against primarily SAA’s former CEO, Mr Khaya Ngqula; and
  • An investigation into the alleged irregular awarding of a tender for dry snacks by Air Chefs.

If these accusations of corruption are true and are not just tactics to divert attention away from the failures of Myeni in her role as SAA Board Chair, they must be fully interrogated by Parliament.
SAA is on the brink of bankruptcy, with the South African taxpayer very close to having to meet the guarantees of some R 9,0 billion to pay off maturing loans to SAA. If this were to happen the consequences for South Africa’s sovereign ratings will be dire.
There is no longer a choice – SAA must be placed under Business Rescue now before it is too late.

SAA losses skyrocket to R3.5 billion

Replies to questions by members of the Standing Committee on Finance from South African Airways (SAA) have revealed that the projected losses for the 2016/17 year amount to a massive R 3,5 billion.  This represents a staggering R 2 billion increase compared with the R 1,5 billion loss declared in the 2015/16 year.
There is no doubt that these massive losses will mean that SAA will once again run out of cash and will have to pull out the begging bowl to get another government guarantee hand-out.
The DA will write to the Finance Minister, Pravin Gordhan, to urge him to refuse any further financial assistance to SAA which is set on a path to self-destruction.
It is greatly concerning that this is R 1,8 billion more than the R 1,7 billion loss that was projected a mere four months ago. This will represent a real cash loss as it will not contain the R 1,9 billion Airbus deal impairments that contributed to the R 4,9 billion loss in the 2014/15 year.
It must be asked whether the 2015/16 loss was massaged down to make the old SAA board and Chairperson, Ms Dudu Myeni, in particular, look like they were making good progress.
The new board of SAA has clearly not been able to turn SAA around or even just stem the massive losses. The board is hamstrung by the apparently poor and incompetent leadership of its chair Dudu Myeni.
This once again reinforces the DA’s view that the reappointment of Ms Myeni as the Chair of the SAA board was irrational.
SAA can only be saved if put under immediate business rescue and action taken to achieve a private equity deal that would result in capital revenue for the shareholder and thus the taxpayer.
The DA has asked that SAA produces a cash flow analysis for the 12 months of the current 2017/18 financial year. This will enable the full extent of the bankruptcy of SAA to be seen.
The DA is even more convinced that the only way to stop the monumental losses is to put the airline into business rescue and we will therefore make every effort to ensure that the Minister of Finance takes action to achieve this.