Cabinet: SAA did consult on Ngqula

Cabinet on Wednesday conceded that the South African Airways (SAA) board had consulted with the relevant minister on the settlement reached with the carrier’s former chief executive Khaya Ngqula.

Briefing the media, government spokesperson Themba Maseko said Public Enterprises Minister Brigitte Mabandla had provided a full report to the Cabinet economic sector sub-committee meeting on Wednesday.

He said Cabinet would not have issued the statement it did about the matter last week if it had had the full report then.

But the statement reflected accurately what was discussed and decided by Cabinet last week.

“The Cabinet decision was taken on the basis of information that was available [at the time],” he said.

In Cabinet’s sub-committee meeting on Wednesday, a full report was provided on the settlement reached.

The report included a legal opinion, which confirmed the SAA board was legally entitled to enter such a settlement and that in doing so there was consultation with the shareholder department and Mabandla.

“However, at the Cabinet meeting [last week] the minister did not have the complete report with her so she could not give the information,” Maseko said.

“Yes, the minister was present at the meeting and she had articulated a level of consultation with the board, but at that time she did not have all the information with her, so she was not able to demonstrate to Cabinet the exact details of the settlement that was reached.

“Cabinet acknowledges and concedes that its approach on the matter would have been different if all the information that was provided today had been made available at its last meeting.

“Cabinet also acknowledges and accepts that the board did exercise maximum caution and due consideration of the best interests of the airline and did consult with the shareholder department,” he said.

Cabinet also fully accepted the bona fides of the SAA board members and would correspond with the board in this regard to confirm that.

“Their bona fides are not in question.”

The settlement reached with Ngqula included tight conditions making it possible for the board to take legal steps against him if the investigation found there was wrongdoing on his part, Maseko said.

Ngqula was fired earlier in March after accusations of tender irregularities in a R1,5-billion catering contract awarded to a consortium involving his wife’s business partner, Vusi Sithole.

It has been reported that Ngqula could get a package of nearly R8-million based on his current salary and taking into account that his six-year contract was due to run until the end of August next year.

This was likely to exclude the more than R1-million in retention bonuses he would have to pay back due to his leaving before the end of his contract.

Last week Maseko said Cabinet took “very strong” exception to the reported financial settlement reached between the SAA board and Ngqula.

But SAA board chairperson Jakes Gerwel explained to Parliament on Tuesday that the board had indeed consulted and took the decision to negotiate a termination with Ngqula due to the need to stabilise the company and “allow the operation to go on without the uncertainties of a CEO on special leave of absence from the company”.—Sapa

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