SAA BRP’s claims of success a complete fiction

23 March 2021

The DA will make every effort to ensure that the South African Airways (SAA) BRP’s (Business Rescue Practitioners), SAA board, and Minister of Public Enterprises Pravin Gordhan cease their collective obfuscation and give clear and unambiguous answers when they appear before the Standing Committee on Public Accounts on Thursday 25 March 2021.

The facts are that the business rescue has cost the taxpayer, and poor South Africans in particular, a massive R7.8 billion in cash taxpayer bailouts since the business rescue process started on the 5th of December 2019. In addition, the business rescue will continue to drain at least another R8,0 billion in a futile attempt to begin miniscule flight operations and to keep our dead national bird operational.

The BRPs seem to think that the following are successes as a result of the business rescue process but the very same “successes” could have been achieved through liquidation and without the additional taxpayer bailouts of R15.8 billion plus.

There has, in fact, been no rescue of SAA. Unlike privately owned airlines that, despite the Covid-19 pandemic, are up and running and in some cases expanding their operations, SAA remains firmly on the ground and only undertaking unsafe taxpayer-funded vanity flights to fetch small quantities of vaccines. Liquidation, however, would have necessitated limited bailouts for SAA liabilities foolishly guaranteed by the ANC and:

The entire R 38,0 billion in liabilities and not just the R35,7 billion could have been written off;

All of the SAA workforces could have been retrenched at a fraction of the cost of the Voluntary Severance Packages totalling R2,8 billion;

Overheads would have been eliminated and not just reduced; and

The preservation of critical memberships of the airline is of no consequence as SAA as a state owned or majority state owned entity will undoubtedly continue to run at taxpayer funded losses if it finally gets operational.

The latest revelations of the apparent gross malfeasance of the CAA in granting 13 exemptions for the SAA vanity flight to fetch vaccines from Belgium in February are the scariest of the failures in the fifteen-and-a-half months long business rescue process. If true, the CAA will have destroyed its reputation. There was, in all likelihood, massive political pressure on the CAA from Minister Gordhan to bend the rules, resulting in an allegedly unqualified flight crew to take the helm of a flight during which an extreme in-flight incident occurred that could have proven fatal.

Surely SiviweDongwana and Les Matuson, the SAA BRPs, must be held accountable for the SAA vanity flight, as the operations of SAA are currently their responsibility?

Considering the fact that the ANC and the Department of Public Enterprises have abandoned SA Express and allowed it to be liquidated, so should they have let SAA be liquidated and used the billions wasted on it to stimulate the economy and save at least some of the millions of jobs lost as a result of Nkosazana Dlamini-Zuma’s irrational lockdown regulations.

Issued byAlf Lees,DA Member of the Standing Committee on Public Accounts, 23 March 2021