Cyril Ramaphosa hands over SAA allegations to special investigators
Continuing with a never-ending disaster, South African Airways (SAA) will now have to face probe from special government investigators upon South African president Cyril Ramaphosa’s orders.
February 04, 2020: Continuing with a never-ending disaster, South African Airways (SAA) will now have to face probe from special government investigators upon South African president Cyril Ramaphosa’s orders. The president stated in January 31 government gazette that he believed the airline to have operated corruptly dating back to at least 2002.
SAA has been the centre of attraction since it has undergone a business rescue programme. A few days ago, the state-owned Development Bank of Southern Africa (DBSA) has prevented the collapse of the carrier by providing it 3.5 billion rand ($239 million), according to the SAA business rescue team.
SAA has been operating under business rescue while practitioners develop a business plan intended to assist the crippled airline’s recovery. A team of business rescue experts have to present the plan by the end of next month.
Ramaphosa’s order to refer the allegations to a special investigation unit has been disclosed in a declaration in the gazette.
The declaration states that the airline or the South African state may have suffered losses, as a result of alleged practices, which could be recovered.
Procurement and contracting of Airbus aircraft, as well as maintenance, are among the matters being referred to the investigation unit, the presidential declaration states. There is no suggestion of any wrong doing by Airbus.
The in-depth authorisation covers the sourcing of services to support the implementation of the loss-making airline’s turnaround plan, and the scrutiny of any payments which were “not fair, competitive, transparent, equitable or cost-effective”.
Ramaphosa’s declaration also points to potential concerns of maladministration relating to travel rebate benefits, payments by the carrier to vendors, and other areas.
SAA in a company release dated January 2020, announced the sale of five A340-300s and four A340-600s aircraft, 15 spare engines - including CFM International CFM56s and Rolls-Royce Trent 500s, and four auxiliary power units (APUs).