The Federation of Unions of South Africa (FEDUSA) is disappointed that Cabinet at its recently held Lekgotla from 16 to 19 August 2016, failed to effectively intervene in the chaotic state of governance affairs and leadership at the Board of South Africa Airways (SAA) and other troubled SOC’s said Dennis George, FEDUSA General Secretary. FEDUSA demands that Finance Minister, Pravin Gordhan, urgently appoints an administrator to replace the Board at SAA, while candidates for a new, independent board and chairperson could be appointed.
The Board of SAA has failed to submit its annual financial statements to the registrar of companies in Hong Kong. This inaction by SAA has compelled the registrar to give SAA until 6 September 2016 to submit their financials, or face possible deregistration. Should SAA be deregistered, then the company would no longer be able to fly to Hong Kong. It is reported that SAA needs a further R5 billion government guarantee and funding, to reinstate the company as a going concern.
FEDUSA finds it very strange that President Zuma should oversee the strategy of all state-owned companies, including SAA. This is a ministerial function, unless it is intended to protect those who are busy with state capture, emphasised George. Moreover, section 66 of the Company Law is very specific in this instance “The business and affairs of a company must be managed by or under the direction of its board, which has the authority to exercise all of the powers and perform any of the functions of the company.” FEDUSA is completely convinced that this decision is incorrect in terms of the principles of good corporate governance, as there is no need for the creation of a special presidential co-ordinating committee, argued George.
Even, the National Development Plan is clear that the shareholder ministry (National Treasury and Public Enterprises) should be responsible for ensuring that SOCs are viable and financially sustainable, and that their assets are maintained and renewed, concluded George.
Issued by FEDUSA