ANC vows not to let go of SAA
RESOLUTION: PARTY BELIEVES AIRLINE WILL RECOVER
Restructuring of SOEs ‘will not necessarily lead to retrenchments’.
Those within the ANC hoping for partial privatisation of SOEs have been met with pushback. The party’s secretary-general said it would not let go of financially ailing national carrier South African Airways (SAA), which has been placed under business rescue and wants another government bailout to the tune of R2 billion next month.
“We believe SAA should be retained as a national airline,” Ace Magashule said yesterday, at a press briefing on the outcomes of the ANC lekgotla on 19 and 20 January. The gathering resolved that an investigation should be undertaken into the historical contracts that impacted negatively on the airline. These included leasing of planes and “evergreen contracts”.
“SAA should be retained as a national airline, which would require substantial restructuring. Cabinet should take the operational decisions needed to achieve that aim,” Magashule said.
Both Magashule and ANC head of the economic transformation subcommittee, Enoch Godongwana, said restructuring would not necessarily lead to retrenchments.
SAA Technical is among companies accused of having flouted procurement regulations, having had contracts renewed without a tender process.
Magashule said the ANC had resolved that state-owned enterprises (SOEs) should be restructured to avoid being a burden on the fiscus. He expressed trust in Eskom’s new management and its ability to increase supply. The ANC had undertaken to make the collection of outstanding monies owed to Eskom a priority.
Meanwhile, SAA’s decision to cancel domestic and international flights has outraged labour, with three major unions at the forefront of talks with the airline claiming they have been sidelined as major stakeholders.
The National Union of Metalworkers of South Africa (Numsa), the SA Cabin Crew Association (Sacca) and Solidarity said they viewed the SAA move as “undermining efforts to implement the business rescue plan”.
Amid the chaos at SAA, Finance Minister Tito Mboweni this week flew to the World Economic Forum in Davos, Switzerland.
Mboweni’s personal assistant, Mary Marumo, said: “The minister booked the flight to Davos in December, but is flying using another airline, not SAA.”
At least 19 SAA flights were cancelled on Tuesday, with operational challenges bringing the airline to its knees. SAA, which requires R2 billion from National
Key stakeholders were not consulted
Treasury to stay afloat, is awaiting the finalisation of a business rescue plan.
Incensed by the cancellation of flights, Solidarity’s legal head Anton van der Bijl said: “Key stakeholders, who include unions, were not consulted. We could have prevented the cancellation of flights.
“As unions, we are fully aware SAA needs the R2 billion to stay afloat, but the company did not have to cancel flights – a decision that clearly demonstrates no one bothered to look at the business rescue plan.”
In a joint statement, Numsa national spokesperson Phakamile Hlubi-Majola and Sacca president Zazi Nsibanyoni-Mugambi, blamed government for “refusing to commit to the turnaround strategy for SAA”.
“In our engagement with the business rescue practitioner last Wednesday, he made it very clear that failure to provide operational capital of R2 billion for SAA will mean it will be facing liquidation.
“As Numsa and Sacca, we have warned previously that government’s voluntary business rescue is nothing more than liquidation disguised as business rescue, and we have been proven correct.
The unions said the turnaround strategy devised by former SAA group chief executive officer Vuyani Jarana was a perfectly viable plan designed to restore SAA to long-term sustainability and make it viable.