SAA board changes a ‘sort of ambush’

2012-09-29 20:47

The resignation of South African Airways (SAA) board chairwoman Cheryl Carolus and seven other board members was “sort of an ambush”, says a spokesman for Public Enterprises Minister Malusi Gigaba.

Wrangling between the board and Gigaba’s department over money led to a two-month delay in the publication of the airline’s ­financial statements.

Matters came to a head ­after Gigaba wrote to parliamentary speaker Max Sisulu this week to inform him that SAA would not be able to table its 2011/12 annual report before the end of September.

Gigaba told Sisulu the auditors could not sign off SAA’s financial statements before the airline’s pressing financial challenges were resolved.

An enraged Carolus has criticised the department for “casting aspersions” on her board, particularly on the issue of submitting ­financial statements on time.

“The comments that the financial statements were not submitted are untruthful and I will not allow my reputation, and that of the board and management, to be called into question,” Carolus told City Press.

She said skyrocketing fuel prices had put SAA under strain and the airline needed a R2 billion overdraft facility in the event that oil prices went up again.

She said the auditors wanted this facility in place to avoid giving SAA a qualified audit.

A commercial bank agreed to make this facility available, provided there was a letter of guarantee from the government.

Carolus said the department advised SAA not to take the bank overdraft because ­interest repayments on it would be exorbitant.

Instead, a state cash injection into SAA’s balance sheet was seen as the best option and Gigaba’s department promised to request the money from the Treasury, Carolus said.

“We were waiting for the government processes on the matter. These failed us.”

But Gigaba’s spokesman Mayihlome Tshwete said Cabinet had approved new board members on 19 September and somehow the list was leaked.

Tshwete said Gigaba had apologised to the outgoing board for the leak and then had “several engagements” with Carolus to plan a smooth handover to the new board.

He said Carolus had spoken to Gigaba extensively in the days leading up to the resignations and had never mentioned a lack of support.

It is in this context he says the events felt like “sort of an ambush”.

“This was a very sinister and malicious thing, it’s very unfortunate.

“Rotations of boards are quite common but the level of unprofessionalism that we saw from those board members is shocking,” Tshwete said.

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