By Lee-Yandra Paulsen
The Organisation Undoing Tax Abuse (OUTA) asserts that government procurement processes and political interference will continue to hinder South African Airways (SAA) ability to succeed in the medium term. The state-owned airline, which exited business rescue after the failed Takatso Consortium deal, reportedly needs an equity partner to stay afloat. Earlier this year, SAA reported a loss of R771 million.
OUTA’s CEO, Wayne Duvenage, explained, “Many countries have abandoned state ownership of airlines. It is a very competitive business with many good players. Even without SAA, which couldn’t operate for a long time, visitors still came to South Africa, and business and tourism flights continued both domestically and internationally. SAA is not a necessity. It was once profitable and a good airline, but that is no longer the case. Continuing to support it will only cost us more money.”
Duvenage noted that the Takatso deal initially seemed promising but was not approved by Parliament due to a lack of transparency.
“There was likely not enough understanding by Parliament, which thought we were giving away 51% of the airline for 51 cents. But that wasn’t the case; Takatso committed to providing R3 billion. During the parliamentary portfolio committee sessions, there was a demand for transparency about the deal and its players. More information was needed, which wasn’t forthcoming, and that derailed the whole discussion,” Duvenage said.
Commenting on former Minister of Public Enterprises Pravin Gordhan’s desire to keep the Takatso deal confidential, Duvenage emphasized the need for transparency from leaders. “What we demand and require of our leaders is to be very transparent. All the information required by the Portfolio Committee, which then cascades into society, needs to be known. If these questions and their answers are not forthcoming, Parliament will not approve the deal.”
He highlighted that most people simply want to fly at a reasonable price. “Airlines today are operated by highly professional businesses. They are highly competitive and require a lot of agility. All we need to know is if the airline is safe, which is ensured by civil aviation authorities and international authorities. Competitiveness will play out naturally, and SAA was never competitive because it wasn’t agile enough. It was cumbersome and had too much political interference,” he said.
VOC News
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