Buthelezi under pressure to reveal SAA's skeletons | Fin24

Buthelezi under pressure to reveal SAA's skeletons

Jul 16 2017 18:32

Cape Town - Deputy Finance Minister Sfiso Buthelezi has an ultimatum. The Democratic Alliance is giving him five days to release several forensic reports believed to contain damning details of gross mismanagement at the embattled South African Airways (SAA).

"What we looking at is some kind of legal action to force him to deliver those reports," DA deputy finance spokesperson Alf Lees told Fin24 on Sunday.

City Press, Fin24's sister publication, revealed that SAA coughed up R4.5bn to overseas contractors. This is based on two forensic reports, in the possession of City Press.

It details how SAA Technical (SAAT), which maintains and services the fleets of the national airline as well as several other carriers, flouted procurement regulations and extended contracts several times without going to tender.

The first forensic report that looked into long-term contracts at SAAT revealed that SAA and its technical division extended a tyre contract, involving Bridgestone Aircraft Tire Europe SA (BAE), several times over 15 years, without a public tender.

The second report shows that a five-year components and logistics contract with Air France, worth R240m a year, was summarily extended on a quarter-to-quarter basis in 2013 by the SAAT board without going to tender.

SAA board to consider reports

Both reports are expected to be processed by the new SAA board. SAA spokesperson Tlali Tlali told City Press that the board will not cover up allegations of criminality at SAA.

Lees said the DA has been pushing for the release of at least 18 reports, conducted over the last two years at the national airline.

The DA wrote to Finance Minister Malusi Gigaba and his deputy to demand that the investigation reports be tabled in Parliament.

The party was denied access to the reports in terms of the Promotion of Access to Information Act (PAIA). However, Lees said that then acting Treasury director general Dondo Mogajane conceded in Parliament in May that the request should not have been rejected out of hand.

Lees said Buthelezi had promised to release the forensic reports to the finance committee, but he has failed to make good on this promise.

"We can't accept that we are not getting these reports," he said, adding: "What have they got to hide that is so damning?"

Treasury recently gave SAA a R2.2bn bailout to help it avoid defaulting on its loan from Standard Chartered Bank, reported Fin24.

Gigaba explained at the time that the loan was "fiscally neutral" with no effect on the fiscal framework.

However, he admitted that "urgent decisions" need to be taken at SAA. “We need to resolve the SAA dilemma. It has gone on for far too long. I want the SAA issues to be resolved.”

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