The business rescuers of SAA told Parliament last week that they had spent R9.9 billion from December 5, when SAA was placed under business rescue, to the end of April this year.  Photo: Reuters
The business rescuers of SAA told Parliament last week that they had spent R9.9 billion from December 5, when SAA was placed under business rescue, to the end of April this year. Photo: Reuters

Unions call for forensic audit of SAA expenditure

By Siphelele Dludla Time of article published May 19, 2020

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JOHANNESBURG - Labour unions at South African Airways (SAA) have called for a forensic audit of all expenditure since the appointment of the business rescue practitioners (BRPs) in December.

The National Union of Metalworkers of South Africa (Numsa), the SA Cabin Crew Association (Sacca) and the SAA Pilots’ Association (Saapa) on Monday accused the rescuers of attempting to strip SAA of its assets. 

Numsa, Sacca and Saapa represent more than 60 percent of SAA’s entire workforce of 4 708. 

Numsa spokesperson Phakamile Hlubi-Majola said the joint business rescuers, Les Matuson and Siviwe Dongwana, their consultants and advisers had been paid some  R200 million in fees since their appointment.

Hlubi-Majola said the rescuers had spent almost R10 billion in six months, but had only sunk SAA into deeper distress. 

“In the last couple of days, the BRPs reportedly proceeded to further deplete SAA’s cash reserves by withdrawing another R2.5m each as fees to themselves,” Hlubi-Majola said. 

“A further R9m has been paid out to consultants, despite the fact that there is no semblance of a business rescue plan. We believe that all this amounts to nothing but the looting of SAA as a national asset.”

On Friday, SAA’s rescuers told Parliament they had spent R9.9bn from December 5, when SAA was placed under business rescue, to the end of April this year.

Dongwana said they were willing to provide the fee structure for the duration of the business rescue process in writing, including the fees for all the advisers.

Parliament has demanded a full schedule of the account of the fees for the rescuers, advisers and all the practitioners involved in the process. 

SAA is in a bad financial state. Its books revealed it made losses of R5.5bn in 2018 and R5.1bn in 2019.

Hlubi-Majola said the business rescuers had reneged on the workers’ offer to take salary cuts of up to 49 percent of their salaries to save SAA R82m, but rather opted to wind down the airline. 

She said they had “completely lost faith” in Dongwana and Matuson, saying they had been a “monumental failure”.

“It is self-evident that they never intended to rescue SAA and, as such, six months later there is no business rescue plan,” she said. 

“Instead, they unfairly attempted to dismiss all employees and wind down SAA, which amounts to no more than asset stripping.

“If they are not willing to categorically support the vision of a new national airline, the resignation of the BRPs and withdrawal of their legal advisers is paramount.”

The unions and the government have formulated a strategic plan in an endeavour to create a new and revitalised national carrier.

BUSINESS REPORT 

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