Secrecy: Private Enterprises Minister Pravin Gordhan has been accused by parliamentarians of not being transparent about the national carrier sale, which has still not been concluded. Photo: Mlungisi Louw/Getty Images
The winding saga of the SAA sale to the Takatso consortium should become the subject of a parliamentary investigation, MPs decided on Wednesday after faulting Public Enterprises Minister Pravin Gordhan for not playing open cards.
At issue is Gordhan’s failure to submit two documents — the shortlist of bidders for a 51-stake in the national carrier and the sale agreement eventually signed with Takatso.
The sale is not yet a done deal, because some of the conditions precedent have not been fulfilled.
Parliament’s portfolio committee on public enterprises concluded that without this information, it could not approve the sale, which Gordhan negotiated personally and — critics say — in an opaque manner.
Parliamentary legal adviser Andile Tetyana said the minister initially agreed to submit the two documents but later reneged, citing third party confidentiality. Gordhan at no point proposed to get around this constraint by offering to show the committee the documents in an in-camera hearing.
Hence, Tetyana said: “A reasonable inference can be made that the transaction is shrouded in secrecy.”
The committee requested the documents in the course of dealing with an allegation by the former director general of public enterprises, Kgathatso Tlhakudi, that the deal was unlawful for two reasons.
First, Tlhakudi said, the terms of the agreement were withheld from him even though he was the accounting officer of the department, in his view because Gordhan failed to act in the national interest and instead struck a deal for the benefit of a few select individuals.
Second, Takatso was not among the strategic equity partners on a shortlist provided to the minister.
Tlhakudi has filed a protected disclosure in which he claimed that SAA had been undervalued by at least R7 billion as part of its takeover by the consortium.
The to-and-fro between him and Gordhan has lasted more than a year. Tlhakudi was placed on precautionary suspension on 24 June last year and dismissed on 26 May this year. He took the matter to the labour court but failed in his bid for reinstatement.
He claimed he was sidelined to stop him exposing wrongdoing, while Gordhan has insisted he was sanctioned for unethical conduct, including meddling in the appointment of the department’s director for security and facilities.
In August the chairperson of the portfolio committee, Khayalethu Magaxa, expressed frustration that it was unable to finalise the matter and report to the speaker. At that point Gordhan had missed a meeting with MPs where he was meant to tell his side of the story, for medical reasons. Tlhakudi appeared before the committee on 7 June.
On Wednesday, Magaxa said it was simply impossible to take an informed position on the deal as Gordhan’s evidence was still outstanding and hence serious allegations were still hanging over the sale of the airline. It was one of the parastatals blighted by state capture, but had been bleeding money and getting by on bailouts for years. Its last recorded profit was in 2010-11.
“It was very difficult to get the evidence,” Magaxa said.
Tetyana said the committee had three options. It could summons the minister to produce the documents, it could report him to the deputy president, through the speaker, for failing to cooperate in the interest of parliamentary oversight, or it could advise that it could not support the sale of SAA to the consortium because of a lack of information.
The Democratic Alliance said it was advisable that Gordhan be summonsed to submit the documents without delay because the SAA sale has been “an absolute can of worms for a very long time”.
But the Economic Freedom Fighters (EFF) was eager that the committee go further still and ask the speaker to appoint an ad hoc committee to investigate the transaction.
EFF MP Omphile Maotwe said: “Chair, I don’t think the minister is going to give us the documents, even if we write to him again. He has made it clear to the committee that he does not want to share these documents with us.
“So let’s send a report to the speaker and ask the speaker to then establish the ad hoc committee to investigate this matter further.”
The ANC majority on the committee, however, elected to leave it to the speaker to decide whether to appoint an ad hoc committee. The net effect is that the deal will remain on ice for now.
It has been fraught from the start and has drawn a warning from the auditor general.
But Gordhan has dismissed criticism as “regrettable efforts by many to sabotage or undermine what is an important project in terms of recovering an SOE [state-owned entity] from the damage that was caused by state capture”.
The Competition Commission earlier this year recommended that the Competition Tribunal approve the proposed merger between Takatso and SAA subject to divestiture and employment conditions.
This followed a complaint that a merger between Gidon Novick’s Global Aviation, Harith General Partners and SAA would crowd out any other airlines from the South African market.
Novick then resigned from the Takatso board, citing a lack of transparency from Harith, Takatso’s majority shareholder and funder, regarding headway made in raising the R3 billion in capital committed to SAA.