SAA reports back to Parliament on its Turnaround Strategy

Following a controversial R550-million government bailout last year, the South African Airways (SAA) had to report back to the Select Committee on Labour and Public Enterprises on Wednesday, 19 February, on the turnaround strategy that would help get the airline on track again.

During the course of his briefing on our national carrier's long-term turnaround strategy, SAA CEO, Monwabisi Kalawe, admitted that while the airline had faced a number of challenges, his team were working hard to strengthen “the weak SAA balance sheet”. He said that amid the challenges, there were a number of successes that sometimes went unnoticed, namely SAA’s excellent and consistent safety compliance record and their award winning performance in terms of punctuality.

Kalawe went on to add that while domestic flights were profitable, SAA’s international routes needed a re-think. He told the Select Committee that loss-making routes like Kigali had been closed and that SAA was looking into expanding into West Africa by including Senegal and Ghana to the airline’s list of new destinations. He said that considering their importance for our economic ties, SAA management would be meeting with their Chinese representatives in an attempt to secure better time slots for flight connections to Beijing.

After Kalawe’s presentation DA’s Herman Groenewald told SAA’s management, "Every time I sit with you there is a new turnaround strategy costing millions of Rands... [yet] it feels as if there's no progress [being made] to improve SAA". He wondered if all public funds going to SAA were actually seeing returns.

ANC Member, Patrick Sibande, defended SAA saying that the challenges were sometimes beyond their control, namely the volatile petrol price, fluctuating exchange rate and hard economic times in general.

Responding to another question from Groenewald about the alleged large sums of money being paid out to advisors and “people outside the organisation”, Chairperson of the SAA board, Dudu Myeni, said that this time round, instead of hiring a team of consultants, SAA had drawn on and relied heavily on the skills of board members and that “we [only] needed one reputable consultant to validate our strategy” thereby saving SAA R30-60 million.

She added that while there was “a bit of turbulence in the organisation” she was positive that SAA was “gaining altitude”.

Earlier Groenewald said that, as there were a lot of negative stories going around about the national airline, “taxpayers and the people that are using it” had a right to know how the loan is being spent and the exact figures that had been injected into the airline.

Kalawe responded that he could “not give ratios and numbers” as he was “not at liberty to share confidential numbers” that only SAA shareholders and the National Treasury were currently privy to. He added that he was not able to disclose the 2013-14 figures “as the financial year has not ended” but that when it did the figures would be reported to SAA’s board before being made available to Parliament.

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