Don’t blame me for SAA’s problems – Myeni

SAA chairwoman Dudu Myeni Picture: VELI  NHLAPO
SAA chairperson Dudu Myeni
Picture: VELI NHLAPO

South African Airways (SAA) chairperson Dudu Myeni does not believe she has done anything to harm the national airline and blames past decisions for many of its present woes.

Contrary to claims by her critics‚ Myeni thinks it is in the best interest of the airline and taxpayers that she serve her full term of office of two years‚ not least because she is championing transformation.

Her views are expressed in a letter to the chairperson of Parliament’s standing committee on finance‚ Yunus Carrim‚ in response to a question posed by DA finance spokesperson David Maynier during a committee hearing in September‚ which she undertook to reply to in writing.

“SAA’s performance cannot be solely attributed to me‚ as current chairperson‚” Myeni insists‚ pointing to the fact that SAA has never been fully capitalised and continues to suffer from the bad decisions of the past‚ including that taken by former CEO Coleman Andrews who sold and leased back the airline’s fleet.

The airline had also suffered heavy hedging losses in the past and continued to do so as a result of plummeting global oil prices and currency movements.

Myeni‚ a close ally of President Jacob Zuma‚ was reappointed as chair of the SAA board in October‚ following a major stand-off with Finance Minister Pravin Gordhan.

The DA described the reappointment as “wholly irrational” and threatened legal action to have it set aside. Under Myeni‚ SAA was forced to reverse a controversial and costly agreement with little-known financier BnP Capital‚ later found to be without a Financial Services Board licence.

But in her letter Myeni says: “The performance of SAA in the 2014/15 financial year is inextricably linked to the historical performance of the airline of at least the past 18 years. These decisions are ‘quite conveniently lumped on my doorstep’.”

She bemoans the lack of economic transformation due mainly to those “who are hanging onto their ill-gotten unearned privilege at the expense of the national imperatives”.

“It is a serious concern that we preside over a state-owned company which continues to be dominated by one section of the society against the majority who receive crumbs from the R24 billion procurement spend. Further‚ I have taken a dim view of the exclusive benefits enjoyed by the pilots. None of these glaring issues has received as much as a whimper from some people.”

Myeni adds: “I would have been a revered chairperson had I protected the status quo; the media would be hoisting me overhead and [giving me] standing ovation[s] as the most effective chairperson‚ while poverty‚ unemployment and inequality continue to affect those in the majority and many downtrodden.

“My problem results from doing what is right‚ investigating losses‚ dealing with corruption and ensuring that we transform the hugely skewed SAA. I therefore respectfully submit that I will not resign‚” Myeni maintains.

“The powerful vested interests have used every means available to defend and further entrench their positions to the exclusion of the majority of the people. In the process‚ the board‚ and particularly‚ currently‚ the chairperson have been attacked by various forums including the media.”

Myeni reserves her main criticism for the SAA Pilots Association‚ which she says has used every means to resist the attempts to restructure the pilots’ unprecedented evergreen contracts that are a significant drain on SAA’s cash-flow.

“The pilots are costing the SAA in excess of R600 million per year in excessive guaranteed benefits‚” she says. “The structure of these agreements is such that even if SAA were to be sold to another shareholder‚ [the agreements] would continue to bind the new shareholder.”

She adds: “It is a matter of public record that the SAA Pilots Association recently petitioned the courts to stop the Board from slashing their benefits. SAA buys cars for pilots. Yet again this matter‚ which threatens the sustainability of SAA‚ is a non-issue for those who continue to attack the airline’s leadership. Why?”

Meanwhile‚ in a written reply to a parliamentary question by DA deputy finance spokesperson Alf Lees‚ Finance Minister Pravin Gordhan says the appointment of advisors to assist government as to how to realign its airline assets‚ namely SAA and SA Express‚ was still being finalised as budgeting issues had to be resolved first.

The consultants will advise on what to do with the state’s 3% stake in SA Airlink; whether to establish a holding company; the corporatisation of Voyager and Cargo; and the incorporation of SAA‚ SAX and Mango into an integrated airline group with and without Airlink.

Also to be decided is the integration of the technical divisions of SAA‚ SAX and Denel; the identification of non-core assets for disposal; the creation of a shared services division; and the establishment of a separate aircraft leasing company.

This included the question of separately corporatising the international‚ regional or domestic routes and investment by strategic equity partners at group or subsidiary level.

– TMG Digital/BusinessLIVE

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