Finance Minister Pravin Gordan said that the promise to consolidate the fiscus has been kept.
Finance Minister Pravin Gordhan made no bones about the financial quagmire South African Airways (SAA) finds itself in during an interview at the Open Book Festival in Cape Town on Thursday.
Gordhan said some kind of continuity at the loss-making national carrier had to be created.
“These things take a long process of consultation and the composition of the board reflects that process,” said Gordhan.
In his view, deputy chair Tryphosa Ramano, for instance, is very skilled.
“There is now a much stronger balance on the board and the chair [Dudu Myeni] will have to work with that team.
“Any notion that the chair can carry on doing things with the new board that might have been done in the past must be seen in the context of the board’s memorandum of understanding and the script that has to be followed as well as government rules,” said Gordhan.
Political analyst Justice Malala wanted to know if treasury is going to give SAA the R5-billon “bailout” it needs.
Gordhan replied that firstly, the new board must start working and then the creation of proper sub-committees must be ensured. The next step would be to get the airline’s financial statements out on September 15, after which the Hong Kong authorities should be satisfied, enabling SAA to keep that route going.
This must be followed by starting the process of “hiring a competent, experienced CEO” and also getting a chief financial officer, as the incumbents are just in acting positions.
“The bottom line is that we must put a management team in place with skills to run an airline.
“Because of our geographic location, not all routes are profitable. I am learning about airline strategy matters where one could, for instance, be willing to make a strategic loss and how to compensate for it – like in any other business,” said Gordhan.
“I wish you luck,” Malala told Gordhan.
“Thanks, I will need it,” was the reply from the finance minister. – Fin24