Riyaz Patel
The Democratic Alliance (DA) says it’s seriously concerned that South African Airways (SAA) and South African Express (SA Express) will not meet their Annual Report submission deadlines for the 2018/19 financial year.
This, after Public Enterprises Minister, Pravin Gordhan informed National Assembly Speaker, Thandi Modise, that serious financial challenges at both airlines caused the delay which has rendered them unable to meet going concerns.
DA Shadow Minister of Public Enterprises, Natasha Mazzone, said according to the Public Finance Management Act (PFMA), both SAA and SA Express boards were supposed to have submitted their audited financial statements and audit report, five months after the end of their financial year.
“This has clearly not been done,” she said, adding “[The] Public Enterprises Minister is required to table before Parliament the annual reports, annual financial statements and audit report of public entities that he is responsible for.“
“The fact that annual reports are again not tabled on time, shows a deep seated problem and is a precursor for another bailout.”
The DA intends writing to the Chairperson of Parliament’s Portfolio Committee on Public Enterprises, Khaya Magaxa, to request that Gordhan brief the Committee on the challenges at SAA and SA Express and why they continuously fail to meet their statutory responsibilities.
“These issues cannot simply be ignored as both airlines have cost the country billions in bailouts and wasteful expenditure,” said Mazzone.
These annual reports are not merely “nice-to-haves,” they are tools that allow Parliament to play its oversight role by holding the Executive and officials to account, she added.
Mazzone said it is not the first time that ailing SOEs are failing to account for their performance and spending.
She said the no-show from the beleaguered SAA reveals a far deeper crises. “The fact that annual reports are again not tabled on time, shows a deep seated problem and is a precursor for another bailout.”
Last year, SAA suffered losses to the tune of R5.5bn and shortly thereafter secured a R5bn government bailout.
“SAA debt which is at R21.7bn is sucking the fiscus dry and pose a great threat to the South African economy,” said Mazzone.
Government guarantees to state companies stand at more than R450 billion, according to data from the National Treasury.
The State’s exposure to this, increased to 64.5 % in the past fiscal year, from 54.4 % as companies drew on the guarantees, Mazzone pointed out.
