Public Enterprises Minister Pravin Gordhan has been given primary oversight of troubled SAA, to join Mango and South African Express, which were already answering to him.
By bunching them together, it will be easier to organise mergers or disposals, but SAA management is unlikely to relish the no-nonsense, tough and uncompromising style of Gordhan.
“The President has transferred the administration of the South African Airways Act, and accompanying functions, from the Minister of Finance back to the Minister of Public Enterprises,” the government announced.
“A proclamation to this effect was gazetted on 1 August 2018.
“The transfer follows a study commissioned by National Treasury and the Department of Public Enterprises to develop the optimal group structure for the state-owned aviation assets.”
It explained that any recommendations of this study “if considered appropriate, may require implementing changes to the group structure of SAA.”
And it suggested that the Minister of Public Enterprises “is best placed to be the custodian of all of the state’s aviation assets.
“These assets are South African Airways (SAA) and its subsidiary, Mango, and SA Express.”
Meanwhile, it was announced that Siza Mzimela is the new acting CEO of SA Express.
“The current acting CEO, Ms Matsietsi Mokholo will be taking up a new position at the Presidency. Ms Mokholo will hand over to Ms Mzimela over the next two weeks,” a statement read.
“Mzimela is a former CEO of South African Airways (SAA), with more than 20 years of aviation experience.
“Until now she has been part of the Ministerial intervention team that was appointed in May to stabilise the (SA Express) airline’s operations, its finances; and to identify options to recapitalise the airline given its immediate short-term liquidity problems.
“As part of the intervention team, Ms Mzimela is also well-positioned to take over the functions as SA Express CEO on an interim basis.”
The government is exploring possible mergers between the three state-owned airlines, and is also seeking an equity partner for SAA, which is a multi-billion rand a year drain on the taxpayer.
Alf Lees MP, DA Deputy Shadow Minister of Finance said: ”The joint announcement by Ministers of Finance and Public Enterprises that South African Airways has been transferred to Public Enterprises comes as no surprise but in itself makes not an iota of difference to the fortunes of SAA.
”Changing the department that is responsible for SAA will not make the airline profitable. SAA will still require taxpayer bailouts of R 5,45 billion in 2018, R 5,18 billion in 2019 and R 1,93 billion in 2020 to fund the ongoing SAA losses that the turn-around strategy includes. These losses exclude the losses from the bankrupt SA Express that simply add to the demands on taxpayers for bailouts of the state-owned aviation liabilities.
’The announcement by the Ministers of Finance and Public Enterprises makes reference to a study done to develop the optimal group structure for state-owned aviation assets. This study must be made public and I have written to the Minister of Finance to request a copy of this study.”
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