Ministers seething over SAA chief's payout

Cabinet ministers are seething about the payout reportedly given to Khaya Ngqula, the chief executive of South African Airways (SAA), and have dispatched Public Enterprises Minister Brigitte Mabandla to sort it out.

Cabinet spokesperson Themba Maseko said after the Cabinet meeting on Wednesday that Cabinet, as shareholder, has asked the minister to “seek an urgent audience with the board [of the airline] to establish reasons for and the details of the settlement”.

He said that the reported settlement was reached at a time when serious allegations of misconduct were being investigated by the board.
“Government preference was that the CEO should have remained on leave while the allegations were being investigated,” Maseko said.

Maseko added that a settlement with a chief executive of a state-owned enterprise ought to have been put to the shareholder, “and it wasn’t”. The state is the only shareholder in SAA, he said, and there was no consultation at all about the golden handshake. The government representatives on the board should have consulted the government to find what the executive authority wanted.

“The state will also seek legal advice on the processes that were followed by the board in reaching the settlement with the CEO without the express approval of the state as the shareholder,” Maseko said. The government has made it clear that it is not prepared to accept impunity with regard any instances of misconduct in the state-owned enterprises.

“The government wants to take steps to ensure that state enterprises, especially those that are underperforming and continue to receive cash injections from the state, do not use these resources to pay large bonuses to non-performing managers,” Maseko said.

Cabinet also decided that the Department of Public Enterprises should submit a report on the state of affairs at the national airline to Cabinet at its next sitting.

“The report must look at issues of governance, management and the reasons for the reported underperformance of the airline,” Maseko said.

“Further the Department of Public Enterprises was instructed to prepare a report on all state enterprises with a view to addressing the problems that are being experienced by these entities.”

Saying that Cabinet believes enterprises play a key role in the economy and it is important that urgent steps be taken to ensure they can perform effectively, Maseko added that a report on all these matters will be tabled at the next Cabinet meeting in two weeks’ time.—I-Net Bridge

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