POLITICS

Injection of Business Rescue funding welcomed – SAAPA

Grant Black says strong decisions now need to be taken to save the airline

SAAPA welcomes injection of Business Rescue funding

29 January 2020

The South African Airways Pilots’ Association (SAAPA) welcomes the announcement by the SAA Business Rescue practitioners that R3.5 billion of funding from the Development Bank of Southern Africa has been secured.

We hope that this vital financial injection will generate the desired return on investment and give our loyal passengers the comfort to return to purchasing tickets on SAA.

We also trust that the Business Rescue practitioners will now take the strong decisions needed to save the airline that result in efficiency and accountability. SAAPA has repeatedly called for the appointment of a robust, accountable management team at SAA. Until now, government has failed to hold management accountable for the downward spiral of the airline and this cannot continue.

Just last week, President Ramaphosa stated that “a major focus of [government’s] work this year is to restore our SOEs to health. We will do this by appointing experienced and qualified boards and managers.”

The bottom line is that Business Rescue will only work if it begins with a fundamental change in SAA management.

Mere days before the airline was put into Business Rescue in December 2019, the SAA Pilots’ Association conducted a vote of no confidence ballot amongst its members. The result was an overwhelming vote of no confidence (84%) in a number of managers from senior and executive management upwards. These managers are still making poor decisions at grave cost to the airline.

The results of the ballot re-affirm our stance that the only way to save SAA and put it on a sustainable path is to ensure that a capable and experienced management team is put in place.  It is therefore our view that the Business Rescue practitioners must prioritise a thorough investigation into the conduct of the current management team and take effective corrective action. This must be done as a matter of urgency.

We continue to engage proactively with the Business Rescue practitioners. We are optimistic that the demands previously made by the SAA Pilots’ Association will be prioritised. These include:

The appointment of a CEO whose previous work experience includes the post of CEO and who has specialised skills and experience in the turnaround of an airline similar in size to SAA;

The appointment of a retired or active pilot to the SAA Board;

A skills audit of all General Managers and Heads of Department, based on international best practices; and

The restructuring of Flight Operations.

The Business Rescue practitioners must also work closely with an independent aviation expert while any rescue plan is implemented. This is essential because the aviation industry has its own specific challenges and operates within very tight profit margins of 2-3%.

We understand that the process upon which the airline is embarking on will not be an easy one. Yet we are convinced that, if done properly, it can effectively address the ongoing and crippling effects of the years of mismanagement, and put the airline back on a financially stable and sustainable trajectory.

The proud history, iconic brand and hard-working people behind SAA have ensured that our loyal passengers have continued to enjoy a world-class flight experience, despite the significant challenges imposed on the airline by management.

We look forward to continuing to work with the appointed practitioners, not only in the manner required by law but also in the pro-active and beneficial sharing of our many suggestions, plans and proposals that have been rejected by the current management.

Issued by Captain Grant Black, Chairperson of the SAA Pilots' Association, 29 January 2020