NUMSA and SACCA condemns the DPE for killing SA Express
16 September 2022
The National Union of Metalworkers of South Africa (NUMSA) and the South African Cabin Crew Association (SACCA) have noted the decision of the South Gauteng High court to liquidate SA Express. We are dismayed that the High court has made a decision to liquidate state owned airline. SA Express was formed as a result of an act of parliament in terms of the SA Express Act 34 of 2007. And that tells you that the only body that can authorize the liquidation of SA Express is parliament.
We also condemn the Department of Public Enterprises for the role it played in destroying the airline. We reject the statement issued by the department yesterday where it desperately attempts to absolve itself of any responsibility. We want to remind Minister Pravin Gordhan that lies have short legs. We all watched and witnessed how he and the department enabled the deliberate destruction of SA Express. DPE objected to the liquidation of SAA by Airlink and it went to court to oppose the application. But in the case of SAX the DPE did not oppose this application even though it had the power to do so. It did not lift a finger to prevent the liquidation of the airline and it took a back seat throughout the entire process. The collapse of SAX rests squarely on the shoulders of Gordhan and also on parliament for failing to take care of our SOE’s and hold the minister accountable. Because of them we lost a valuable and viable SOE to corruption, and workers and their families paid the highest price through unemployment and poverty.
SCOPA did not do enough to save SAX
Parliament as an oversight body plays the role of being a parent to SAX on behalf of the public. In particular the Standing committee on Public Accounts (SCOPA) has a specific role to play in ensuring that public funds at SOE’s are not wasted and that the entity is not mismanaged. The role of the DPE can be compared to that of a nanny which is taking care of the SOE on behalf of parliament. The fact that SAX has been liquidated is evidence that DPE has failed the airline and failed the public. It choked the airline and used the covid-19 pandemic as a cover. DPE is like a deadly nanny which suffocates the children which have been placed in its care, and when you look at all our SOE’s they are all in various stages of distress and neglect as a result of DPE’s incompetence. It enabled the collapse of the entity by starving it of food in the form of capitalization. It also failed to act to intervene on allegations of corruption at board level. They literally suffocated the airline, and SCOPA, as the parent abdicated its responsibility and did not look after the entity. It was an absent parent that allowed an incompetent negligent nanny to kill its offspring. SCOPA failed to hold DPE accountable for the state of our SOE’s and for SAX in particular. And it was employees of SAX who suffered the most as a result of DPE’s negligence through massive job losses.
The liquidator also participated in SAX’s destruction
We must also highlight the negligent behavior of the liquidator Mr. Aviwe Ndyamara who never disclosed the value of SAX, nor did he disclose if there were any buyers. Ndyamara failed to be transparent on the bids received and the reasons why those bids were rejected. As unions we were kept out of creditors meetings and therefore we were not able to give any input on the process.
As NUMSA and SACCA we did everything possible to save SAX. We even lodged a constitutional court application calling on the court to compel SCOPA to intervene on the future of SOE’s. Parliament’s portfolio committee on Public Enterprises and or SCOPA should be the one to make the determination on whether SAX can be liquidated. We argued that the courts should not be given the power to decide on the fate of SOE’s especially because these state owned companies exist because of government policy. These entities have a strategic role to play in the economy and if the state has decided that they no longer serve that purpose, then Parliament must pass a resolution on this and legislate accordingly. The purpose of our constitutional court application was to compel SCOPA to hold public hearings on whether SAX or Denel, or any other similarly placed SOC should be permitted to go insolvent, and consequently to be liquidated by a court. Unfortunately, the constitutional court misunderstood our application and then dismissed it without even hearing it.
NUMSA and SACCA also organized an investor and the bid he made was dismissed without any reasons given. It is an indictment on this government, but in particular on the DPE and SCOPA for failing to take care of this SOE to the extent that it has now died an unnatural death because of them.
What is to be done?
We demand that SCOPA must do it work and convene public hearings to investigate the conduct of Minister Pravin Gordhan and the entire Cabinet in terms of chapter 4(3) of the constitution which speaks about the role that parliament plays in overseeing executive action. Cabinet, under the leadership of President Cyril Ramaphosa, was aware of these decisions and participated in the collapse of SA Express. The entire executive must take responsibility for the state that SAX is in today. SCOPA must further investigate the failure of the Minister to consolidate Aviation state entities in terms of government policy, this includes protecting SAX from corruption from former Board members who were appointed by the DPE. Minister Gordhan must be investigated for allowing SAX to be placed under provisional liquidation, when it refused to support business rescue practitioners who were trying to save it. It has been obvious from the beginning that DPE intended for SAX to collapse. We also demand that SCOPA investigate the role played by the liquidator who refused to consult with creditors particularly unions during the liquidation process.
To date many workers at SAX have not been re-employed because DPE single-handedly destroyed the aviation sector in South Africa with its mismanagement of SAA and SAX. We will continue to suffer as a country if there is no intervention in the disastrous decisions made by this cabinet and by DPE in particular.
This statement was issued by NUMSA and SACCA.
Issued by Zazi Nsibanyoni-Mugambi, SACCA President, 16 September 2022
