Minister Malusi Gigaba, following protracted disputes leading to the resignation of eight of the eleven board members over the past week.
Gigaba has acted promptly, and less than a week after the resignations has already appointed a new temporary board, including a new chairperson, while reeling out criticism and accusations against the out-going board.
While it is unclear what exactly triggered the stream of resignations at Africa’s largest carrier, the state-owned airline has been under fire recently as the company struggled to stay afloat. Tensions erupted weeks ago, when the SAA board requested a 4 billion-6 billion rand ($480 million – $720 million) bail-out from the government, followed by the airline failing to present its annual financial report to parliament by the end of September deadline.
In an unanticipated move last week, members of the board began to resign; starting with Russell Loubser, who was quickly followed by chairwoman of the board Cheryl Carolus. Once the chairwoman had left six more of her board walked out; Bonang Mohale, David Lewis, Jabulani Ndhlovu, Louis Rabbets, Margaret Whitehouse and Teddy Daka all leaving their positions.
While not giving specific reasons, the board all pointed to the lack of support from government as reason for the departures and alleged that the government has failed to speak up when the board has been publically criticised. Lewis listed more reasons, including: budget, finances, and uncertain strategy. The walk-out has come suddenly, and most probably took the government by surprise given that an annual general meeting is scheduled to take place on October 15th. Public Enterprises has indicated that board rotations and/or changes to the line-up were to be discussed at the up-coming AGM anyway.
The turmoil in Africa’s largest carrier’s management follows a similar trend in the aviation sector in Africa. Only last month, West Africa’s largest carrier, Arik Air grounded all domestic flights in Nigeria, crippling air transportation in the oil-rich country, after alleged disputes with the government.
However, Gigaba has taken an aggressive approach to the resignations, accusing the departing SAA board of lying to the public over the alleged lack of government support. He told BDLive: “Such absolute nonsense. We could easily have said, why are you in the red, we reject your proposal and we are not going to talk to National Treasury … [we] allowed a number of transgressions and focused on moving forward. They don’t care about SAA and its reputation. They are more concerned with their egos”. Gigaba added: “It says a lot about their integrity if they are prepared to lie in public.”
Gigaba has named Vuyisile Kona as the new chairman of the board, and appointed a number of non-executive directors to act on the board until the government names a new board at the AGM; new members are rumoured to already have been selected.
