Shape up or ship out, parliament tells SAA’s business rescuers

By Siphelele Dludla Time of article published May 18, 2020

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JOHANNESBURG - Parliament has told the business rescue practitioners (BRPs) of South African Airways (SAA) to “shape up or ship out” as the process of saving the national carrier has drowned millions of rand, with no final rescue plan in sight after five months.

The BRPs have now been given 25 days to produce a complete business rescue plan as they struggled to convince the standing committee on public accounts (Scopa) on Friday.

Scopa chairperson Mkhuleko Hlengwa said they were not pleased that five months had passed and the rescuers had still not tabled a finalised business rescue plan.

“We still need further engagement with the business rescue practitioners, because the more they provide answers, the more questions arise,” Hlengwa remarked.

“The bottom line is either you shape up or ship out. We, as Scopa, have had it up to here, and I think I speak for all South Africans,” he said.

SAA’s annual financial statements presented before Parliament on Thursday revealed that the troubled airline made losses of R5.5billion in 2018, and R5.1bn in 2019.

The national carrier has no money to pay its 4708-strong workforce this month.

STANDING committee on public accounts chairperson Mkhuleko Hlengwa. Supplied

All its staff members have been put on unpaid leave of absence since May 1, including those who are reporting for duty.

Public Enterprises Minister Pravin Gordhan told Scopa that a total of R30million had been shared between the rescuers Les Matuson and Siviwe Dongwana since their appointment in December.

Gordhan expressed his displeasure with the endless extensions for the tabling of the rescue plan, calling for finality regarding the plan and value for money.

“We are not happy with these constant extensions, and as a result, there is no business rescue plan as a consequence of five months’ work and the amount of money and fees that have been earned,” he said.

Gordhan also said they would not accept liquidation of SAA as an option, as they did not know who was waiting in the wings to buy its assets.

The BRPs have appealed for more government funding, saying that only winding up or liquidation would be the only two options left for the airline, if no money was forthcoming.

Dongwana said they had spent R9.9bn by the end of April since they took over the running of SAA when it was put under voluntary business rescue in December.

“We would be more than happy to provide the fees for the rest of the team to the committee in writing for the duration of the business rescue process, including the fees for all the advisers,” Dongwana said.

Hlengwa said it was important to know how much the rescue process had cost the fiscus.

“We still want a full schedule of the accounts of fees of business rescue practitioners and their consultants, so that we have a sense of what this incompleteness of work is costing us,” he said.

The committee will now compile a list of questions from all the members with regard to SAA and its business rescuers, which should be responded to by next Tuesday.

“We would like to get a date as to when the business rescue plan is going to be finalised. It can’t be open ended,” Hlengwa pointed out. “We will consider it as a committee, and if it means that we make a determination for you, then we will do so,” he said.

BUSINESS REPORT 

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