The government has launched an investigation into exorbitant incentive bonuses awarded to senior executives at the ailing South African Airways (SAA).
The probe was prompted by a complaint by the SAA Pilot Association (Saapa). The union, which represents about 700 SAA pilots, this week confirmed that it had requested the probe, but declined to divulge further details.
Saapa spokesperson Cathy Bill said the investigation was ”private” and that the organisation’s legal adviser had advised her not to discuss details of the probe.
A senior pilot at SAA reportedly earns R600 000 a year. In 2002 Parliament noted that ”there has been a very high rate of pilot drain by other air industries from elsewhere which offer them lucrative packages”.
According to SAA insiders, Saapa forwarded its complaint to Public Enterprises Minister Alec Erwin a few weeks ago. Erwin’s spokesperson, Gaynor Kast, said the minister was not aware of the probe or the complaint by Saapa. However, a senior official at SAA, who chose to remain anonymous, said he was aware of Saapa’s complaint to the Department of Public Enterprises.
A senior manager at SAA said the pilots are also concerned about the incentive scheme, which they do not benefit from, and SAA’s failure to give them departure packages similar to those awarded to senior executives when they leave the airline.
”My understanding is that Saapa wrote a letter to the minister requesting him to investigate SAA’s incentive scheme. My information is that the minister obliged,” he said.
One SAA insider told the Mail & Guardian: ”Saapa has raised concerns about the inconsistencies as far as remuneration is concerned.”
He added: ”The organisation is worried that people are being given huge incentive bonuses despite the company’s poor financial performance. The other problem is that ordinary staff members do not get the incentive bonuses.”
SAA and its parent parastatal, Transnet, have been struggling financially in the past few years. In August, the government replaced the boards of both SAA and Transnet following poor financial performance, driven largely by mounting losses from SAA’s hedging programme, devised for exchange rate movements.
Former SAA chief executive AndrÃ