When will the SAA Board & Media address the corruption by white-owned-companies at SAA?

TryphosaRamano

TryphosaRamanoTryphosa Ramano – Deputy Chairman at SAA

STEVE BIKO was adamant that the most potent weapon of the oppressor is the mind of the oppressed. This view cannot be more apt for what is going on at SAA at the moment.

Instead of the Board addressing the rampant corruption, perpetrated by white companies in large part, we have instead, one of the board members, and I have my suspicions who it is, running around to commercial media with obfuscations about non-attendance of meetings and other petty issues which the Sunday Times will probably write about tomorrow. Look, the point is, the M&G started the issue a week ago, followed by the Sunday Times which will no doubt, want to prolong it even further. I’m not in any way suggesting that not attending meetings should be taken lightly, but I wonder why this board member is not also leaking the companies which have looted SAA and the executives who have enabled this runaway looting. I will address the issue of the meetings in a moment, but corruption at SAA is so endemic that an Ernst& Young forensic report has put it at R705,582,427.38 in wasteful expenditure. We’ve written extensively about the corruption at SAA and it doesn’t take rocket-science why this corruption is not in the headlines of newspapers. It is perpetrated by whites and it would disrupt the narrative of the black face of corruption that the commercial media is promoting.

The E&Y report has highlighted that the biggest area from which the losses emanate is procurement. The national carrier has a budget of R24bn of which only 2% goes to Black-owned companies. The forensic report said 60% of the contracts and these were the longest and highest in value, were corrupt. They operated with no contracts and were over-paid. Imagine if these were Black companies. There would be unending stories on all newspapers about the companies involved.

SAA Corruption at a Glance (there’s more) 

Cases of Failure to follow correct tender processes, overpayment, no explanations for payment & collusion at SAA. Here are just a few.

  • There’s an overpayment in the case of Kintetsu World Express (KWE) whose contract was “concluded informally” on 28 August 2014 and evidence of possible collusion between SAA officials and KWE
  • Overpayment in case of SAA’s contract with Societe Internationale de Telecommunications Aeronatiques in 2013
  • Failure to follow correct tender processes and overpayment in respect of Air Chefs’ contracts with ADJ Maintenance, Vizzini Motors, First Garments.
    CAE Inc was paid R1.1m while invoices for 2013 reflected R8.2m. Where is the explanation?
  • Havas Worldwide overpaid by R53, 767, 139.64
    There are allegations that the MOU between SAA and AAR and the awarding of the contract was based on a potentially corrupt relationship between AAR and SAA officials. The E&Y’s preliminary investigation has found there is merit in the allegation and recommends further investigation. In his resignation letter, SAAT board member, Barry Parsons said, in reference to this deal…”There is clearly a hidden agenda somewhere in this relationship and it requires urgent independent investigation.
  • The Independent Group a few days ago reported on a case of SAA executives who had manipulated procurement procedures to benefit a contractor who got a R1.4bn tender. https://www.pressreader.com/south-africa/the-sunday-independent/20170528/281487866300860
    The number of companies whose contracts have been extended without due process is endless.

The Battle over Addressing Corruption & Privatisation of SAA

Addressing Corruption and privatising the airline are at the heart of the spat that has gone public with some members of the Board leaking communication between themselves and proceedings of meetings.

Chairperson Dudu Myeni and her deputy, Tryphosa Ramano are at loggerheads over the issue of privatisation of the airline and the rampant corruption. Myeni, part of the old Board,  is said to be against privatisation and is frustrated that the Board has not since coming into office addressed the issue of the corruption and holding those responsible to account. Ramano, part of the new Board hand-picked by former Finance Minister Pravin Gordhan last September is  said to be prioritising privatisation instead. A month into their appointment, the new Board, unbeknown to Myeni and at the behest of Gordhan, were to appoint Bain Consulting as turnaround strategists. The founder of Bain Consulting is American Coleman Andrews who was SAA’s CEO in 2000 and is attributed to the worst financial woes of the airline. It is during his time that SAA fleet was sold off and leased back. The airline pays hundreds of millions to international companies on aircraft leases. Privatisation is Gordhan’s baby, you see. He, together with his ANC representatives on the Transitional Executive Committee’s sub council on finance, sold off our country to the IMF and World Bank. South Africa took out a loan of $850m in 1993 to pay off apartheid debt that killed and maimed Black people. With it came restrictions which affected Black people. Gordhan and his pals continued to sell away state assets until he was, thankfully fired.

Jessica Bezuidenhout of the Mail & Guardian, a week or so ago, wrote of the Board’s attempts to oust Myeni for not attending meetings and not communicating with the Board. It cited three letters from Ramano, written in April, as proof. There are also stories about Myeni blocking the appointments of a chief executive officer and chief financial officer. It becomes very clear who the source of these stories is but more importantly, when is this Board dealing with corruption?

Board Meetings

I dont profess to be a guru in corporate governance but how is it that Bezuidenhout and Sunday Times didn’t question how a board could sit for ten or eight meetings in a matter of six months? One paper said ten and another eight. I investigated and established that SAA had eleven meetings since January this year. My limited knowledge is that there are scheduled meetings for non-executive directors, four per year in most cases. How is it that non-executive directors can be asked to attend 11 meetings in a space of six months, many at short notice and as a deliberate tool to ensure some board members are unable to attend?

I’ve been told the scheduled meetings have never concluded an agenda and this, I thinks, is so the Board doesn’t deal in the important issue of these corrupt companies.   Maybe Ramano can explain to commercial media why this is the case but more importantly what the SAA board is doing about corruption at SAA. That is the crux of the demise of SAA. If you close the corruption there, there probably wouldn’t be a need to privatise, which is probably why Gordhan’s hand-picked board, apart from being captured by the narrative of corruption being black, are not particularly interested in addressing.

Ramano, interestingly, sits on the Finance, Audit and Procurement committees. Again, I reiterate I have no expertise in corporate governance but who would police whom if the same people on procurement (where there’s immense corruption according to E&Y) sit on finance and then on audit?

In a country whose media has so become oppositional, it is easy to deflect attention from the real issues and point to personalities instead.

 

5 Comments on "When will the SAA Board & Media address the corruption by white-owned-companies at SAA?"

  1. Nice work you are doing, these are issues that need us black people to unite and fight against this scourge

    • Pinky Khoabane | June 24, 2017 at 9:56 pm | Reply

      Dear Siya

      Thanks a lot. I really hope with the little effort here at UnCensored we can open our eyes and begin to ask the real questions.

      Kindest

      PK

  2. Puleng Lekgoathi | June 25, 2017 at 11:26 am | Reply

    As mentioned earlier, nobody including our own will want to protect Dudu Myeni but will at at a whim protect corruption at the airline with the assistance of white owned and controlled media, who is fooling the who?

  3. If only SAA can be solid on their ground and operate fairly to everyone then we talking success

  4. Why the SAA board is delaying in tackling the fundamental issue of corruption? Is it because the board members are agents of wmc that their mandate is to make sure that PG and cronies are protected at all cost?

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