The NEW SAA: Mile High Debt Club (corrupt members only)
Everybody knows our national airline South African Airways (“SAA”), a lot of people know that SAA has not been profitable for years, some people know that the airline had to be subsidised to an annual tune of between ZAR 7bn and 12bn to keep it in the air, but only very few people have now realised that the New SAA is not a rescued airline, but the same failed airline now managed only by people without skills and an even bigger appetite for state funds.
SAA was ordered into Business Rescue by President Ramaphosa after the last profit of the airline had been turned in 2013. No private company would have been alive after 7 years of economic failure and losses that amount now over ZAR 100bn. The decision had been made by the President as he regarded the continuous drain on state funds as not justifiable and also not affordable anymore given the weakening economic circumstances. But was pretty much the only rational decision made from there onwards.
Minister of Public Enterprises, Pravin Gordhan, who is technically in charge of SAA as State-owned Enterprise (”SOC”) has long lost his teeth and grip on reality as he had been bought by the Mafia of the NEC as they needed him to ensure the continuous existence of the SOCs for them to enrich themselves unlimited, unsupervised and unaccountable.
SAA has more than 130 Senior Executives, who all are related to or have been rewarded by the ANC, not being required to offer any skills but entitled to a fat pay cheque at the end of every month
But what was supposed to have an end, they quickly and cleverly turned around into a renewed fountain of prices paid for by the taxpayers: The “New South African Airlines” …. what a joke …. and here is how it’s done:
Firstly, the Business Rescue Practitioners dug deep into the web of corruption, embezzlement and violations of financing statutes, but what should have followed, quickly, should have been the liquidation of SAA and the initiation of legal proceedings against the senior executives. But South Africa is not built on law and order, it is built on the totalitarian principles hammered together outside any democratic structure and protected by the governing, unholy tripartite alliance consisting of ANC, Unions and the Communist Party. Over six months of public bickering between the stakeholders kept SAA alive, caused salaries to be paid and the future still undecided.
Now the decision is made and the self-enrichment troika is pleased with looming payouts as 2 700 retrenchment packages will change hands and instead 1 000 new personnel will be hired …. does that make sense? Surely not especially in light of the fact that those retrenched are not the senior executives!
And with this decision reached the survival naturally came with a Price Tag for the restructuring of the airline, which was documented by the Rescue Practitioners with ZAR 10bn but has within 48 hours increased to ZAR 26.7bn ……. Almost triple, and still almost double of what Finance Minister Tito Mboweni had budgeted and communicated. But what does the self-enrichment Mafia in the other departments care about budgets? They have over the years downgraded the importance of budgetary figures to “nice to have”, but in essence they show the people how to live above means and getting away with it. Shocking? Not really considering how many Ministers actually passed Maths during their matric ;-) …. and now Mboweni and Gordhan are searching for funding!
Finally, the New SAA needs a CEO but who qualifies for this highly challenging position? Let’s answer first the opposite question: Who would be the least qualified person for the position as CEO? Wouldn’t that be the previous Chief Commercial Officer as he would have been the person unable and too incompetent to bring SAA back into the profit zone? Isn’t it ultimately the former Chief Commercial Officer who is to blame for the situation of SAA, for the continuous losses suffered and for the airline having to file for Business rescue? The answer is YES, but without the desired consequence as the former Chief Commercial Officer of SAA, Philip Saunders, has just been appointed as the acting CEO of the New SAA. No joke and one should not laugh except maybe about the statement by the Department of Public Enterprises, which lauded him as “an experienced airline executive with a strong commercial background”. This finds me speechless!
The “experience” of Mr. Saunders – beside driving SAA deeper and deeper into the debt tower – is overwhelming, indeed, as his positions in such huge international airlines like Kuwait Airways, Air Malta, and Caribbean Airlines show. So why is this commercial failure of a C-Level Executive now allowed to continue to play with real planes and real lives instead of the toys he is used to?
BECAUSE he is the needed ANC puppet, who is able to open the pipelines for all future funding for the airline directly into Mantashe & Co’s pockets. That’s why, and that is the only “why”!
The New SAA …sounds great, but it is just another epic monument for the relentless and unscrupulous shenanigans of this government to their benefit and theirs alone! But the sobering fact is that there is only one fiscally prudent and legal answer to the question about the future of SAA in case the honourable Minister would truly ask me:
Swallow your Pride, Liquidate the Airline, Sell its Assets and Put the Proceeds to work in Health, Housing and Education!