JOHANNESBURG – Former minister Malusi Gigaba was unrelenting in his quest for SAA to drop the profitable Mumbai route and allow India's Jet Airways to take over, the state capture commission of inquiry heard on Thursday.
Former SAA board chairperson Cheryl Carolus gave testimony on her tenure at the national carrier between 2009 and 2012.
Former president Jacob Zuma had fired former public enterprises minister Barbara Hogan in 2010 and replaced her with Gigaba. Carolus said a few weeks into his appointment, Gigaba called an impromptu meeting with the SAA board to discuss the Mumbai route.
The SAA executives, Gigaba and his then deputy minister Ben Martins waited for three hours for an additional two people whom the minister said would arrive to join the meeting, said Carolus.
"Unfortunately, it was very short notice and I couldn't attend the meeting. I asked then CEO Sizakele Mzimela and the chairperson of audit committee, the late Mr Sithole to attend the meeting. Subsequent to that Ms Mzimela reported back to me. One thing that struck me was that they waited for hours in the minister's office for those unknown guests," Carolus.
"It was extraordinary that a whole minister would sit for three hours waiting relentlessly. Two gentlemen arrived from Jet Airways, one of the was the president of Jet Airways. The minister took a back seat, said nothing, did nothing as Jet Airways president interrogated Mzimela over the Mumbai route."
She said Gigaba, who had called the meeting, allowed the Jet Airways representative to lead discussions and charge at Mzimela. The executive did so in his efforts to convince her to drop the Mumbai route. Martins then interjected on behalf of Mzimela.
"He told the gentleman that he had no right to come into our country and give instructions. It was awkward for Mr Sithole and Mzimela."
Commission chairman Deputy Chief Justice Raymond Zondo asked Carolus: "SAA was running this route itself.. people came in telling you to stop the route. Isn't that very strange? And did you know what was special about these people that [the] minister had to wait so long for them to arrive?"
Carolus replied: "Chairperson, if you are puzzled, I can assure you I am puzzled even today."
She said there had been a history between the two airlines where SAA collaborated with Jet Airaways, but that the Indian airline had, at at some point, refused to pay.
"We were happy to discuss this properly, evaluate if what they gave us makes business sense. There had to be processes, SAA is a business too, [and we] couldn't just give away such an important route without a rigorous process."
Although a government representative at SAA, Gigaba was hellbent on helping Jet Airways instead of SAA, said Carolus.
"The minister was an SAA shareholder but he seemed to be quite persistent to help out Jet Airways. It was clear that he was in conversation with Jet Airways than he was with us," she said.
"There were many ways the minister could help us, for example, with visa requirements, because there were new regulations that travelers to SA from Mumbai carry visas. The very thought that he would be so persistent to help them [Jet Airways] out, but never inquired from us whether we needed any help from government struck a chord."
While at the meeting, Mzimela's office received a call from a man who said he was a representative of Jet Airways and that he needed the chief executive to urgently sign the SAA agreement to let go of the Mumbai route. Carolus said the caller was aggressive to Mzimela's secretary.
In 2011, Gigaba called a second meeting to Cape Town to again talk about the India route to South Africa.
Carolus said she could not make it to the meeting again as she had prior arranged engagements and sent a board member and Mzimela. The then SAA chief executive was again interrogated, this time by Gigaba's legal adviser, Siyabonga Mahlangu, while Gigaba kept quiet.
"Mr Siyabonga Mahlangu, whose presence there confused the SAA representatives, starts talking. He berated Mzimela for SAA's refusal to close [the] Mumbai route, saying the board was wasting government money that could be used in building many RDP houses … it was strange coming from [a] legal adviser. Mzimela said she took exception to being addressed in that manner, her fellow representative then asked Gigaba to stop Mahlangu from addressing her ins such a manner."
Gigaba's only contribution at the meeting was to tell the two parties that "they need to find each other", said Carolus. Nothing further was discussed and no agreement was signed regarding the Mumbai route.
Carolus testified that soon after becoming the minister, Gigaba had been briefed about the SAA strategy and plans. She said that Gigaba spoke publicly against the board, saying they did not have a strategy for the national carrier. This was in contrast to Gigaba having no complaints against the board and management privately, and no concerns regrading management's strategy.
"He accused the board of being incompetent or misrepresenting the facts. He said we did not have a strategy, meanwhile, he knew I signed off the SAA strategy. It was quite an awkward position and we did feel that that undermined the airline," said Carolus, adding that the board competence was a key factor in terms of risk and loan financing.
"It was irritating...we felt aggrieved when he started questioning the integrity of the board...saying we are not patriotic."
She said that when the SAA needed government's help to stop the loss-making Botswana route, Gigaba was nowhere to be found. Carolus said government dragged its feet and would not agree even if sensible business reasons were forwarded.
"We were losing quite a lot of money on the Botswana route...should I go to Botswana, I drive. It didn't make sense to fly even for business. We needed government permission...they dragged their feet on it and we sustained heavy losses. There was total lack of focus and urgency....we were miffed about it. We wondered why they cared about Mumbai and not Botswana? The only route the minister ever addressed us on was Mumbai."