SAA CEO may not have signed contract yet

28 August 2017

Finance Minister, Malusi Gigaba, committed in his 14 point plan to appoint the SAA CEO by 31 July 2017. This was a key ‘action item’ in the plan and a condition imposed by some of SAA’s lenders.

Gigaba assured the country on numerous occasions that Mr Vuyani Jarana had been appointed as the CEO:

- On 3 August 2017, he said that ‘Vuyani Jarana has been appointed South African Airways Chief Executive Officer. He will commence his duties after his current employer has officially released him;’

- The next day, he said that ‘I think it is appropriate to start with an announcement that I am sure you all have heard that we have appointed the CEO of SAA yesterday;’ and

- On 25 August 2017, he said that ‘The good thing is that there is a new CEO who has been appointed. We are paying close attention to strengthening the board of SAA and appointing the requisite skills on the board.’

These assurances seem to have been contradicted by SAA Board Chair, Dudu Myeni, on 23 August 2017 when she informed Parliament’s Standing Committee on Public Accounts (SCOPA) that she did not have a date for when Jarana would take up the CEO position. Myeni told SCOPA that ‘He has accepted the offer’ and that ‘We are hoping that he will start on the first of September.’

It is quite astounding that the SAA Board Chair does not seem to have knowledge of any signed contract which leads us to believe that Mr Jarana may not have signed the contract yet.

The CEO’s appointment is important because if the CEO is not appointed, this could result in a default that would require all remaining R14.6 billion of bank loans to be repaid immediately.

SAA has not had a permanent CEO for more than two years and has run at massive losses amounting to R6.1 billion during that period. It is critical that a permanent CEO be put in place to take control and implement robust cost-cutting and revenue improvement measures.

Issued by Alf Lees, DA Shadow Deputy Minister of Finance, 28 August 2017