National Treasury concerns with the sale of SAA shares

22 March 2022

Note to Editors: Please find an attached soundbite by Alf Lees MP

The DA has submitted a written Parliamentary Question to the Minister of Finance, Enoch Godongwana, to establish what concerns National Treasury had with the agreement providing for the disposal of 51% of SAA’s shares to the Takatso consortium were and what action was taken by National Treasury to ensure that these concerns were dealt with.

The DA notes the report to SCOPA by National Treasury (link here) responding to questions posed by the DA regarding the disposal of 51% of the SAA shares to the Takatso consortium. The response from National Treasury indicates that National Treasury:

Was excluded by Department of Public Enterprises (DPE) from the process followed to select Takatso as the beneficiary of 51% of SAA shares including the conceptualisation, negotiation and finalisation of the terms and conditions of the agreement between the Department of Public Enterprises and Takatso,

Was only consulted by the DPE after the process of selecting Takatso as the beneficiary for 51% shares of SAA and after a deal between the DPE and Takatso had been concluded,

Is not in a position to indicate whether the process followed in order to select Takatso as the beneficiary of the 51% SAA shareholding was compliant with all applicable legislation and regulations,

Raised concerns about some of the terms and conditions contained in the agreement to dispose of 51% of SAA concluded between the DPE and Takatso.

National Treasury stopped short of giving details of the concerns they have about some of the terms and conditions contained in the agreement to transfer 51% of SAA shares to Takatso as entered into by the Department of Public Enterprises and the Takatso consortium. I have therefore submitted a Parliamentary Question to the Minister of Finance to obtain the details of the terms and conditions that were of concern to National Treasury as well as what action National Treasury have taken to deal with these concerns.

On the 8 March 2022 I submitted a PAIA application to the Department of Public Enterprises in order to obtain a copy of the agreement entered into between the Department of Public Enterprises and the Takatso consortium to dispose of 51% of SAA shares to Takatso. To date I have not received the copy of the SAA DPE/Takatso agreement.

It is clear from the National Treasury report to SCOPA on the 51% SAA share disposal to Takatso that the authority of the then Minister of Finance, Tito Mboweni who had opposed bailouts to SAA, was bypassed by Pravin Gordhan, the Minister of Public Enterprises, simply taking the 51% SAA share disposal directly to Cabinet for approval and thus avoiding the need for any approval, concurrence or noting from/by the then Minister of Finance, Tito Mboweni.

Issued by Alf Lees, DA Member of the Standing Committee on Public Accounts, 22 March 2022