Business 25.7.2016 02:09 pm

Opposition seeks to end further SAA financials delays

FILE PICTURE: Democratic Alliance supporters sing and dance outside the High Court in Pretoria. Picture: Werner Beukes/SAPA

FILE PICTURE: Democratic Alliance supporters sing and dance outside the High Court in Pretoria. Picture: Werner Beukes/SAPA

The DA blames the delay on a widely perceived stalemate between the finance minister and the presidency over the SAA board.

The DA has on Monday urged Parliament’s standing committee on finance to seek legal advice on whether or not it is allowed to grant National Treasury a third extension in tabling South African Airways’s financial results.

“It is in our contention that there is no provision made in the Public Finance Management Act (PFMA) whereby Parliament is given the authority to extend the deadline. Parliament must give effect to this deadline and interrogate these long overdue financials,” the DA’s Alf Lees, the party’s deputy finance spokesperson, said.

This comes after Parliament on Monday published Finance Minister Pravin Gordhan’s letter, dated July 7, to the committee, asking for an extension until September 15 to table the financial statements for the troubled national carrier.

SAA has a total debt of R15 billion.

Gordhan writes in his letter to the committee: “Please note that the process of reviewing SAA’s application for a going concern guarantee is not yet finalised. Therefore, I humbly request that the Standing Committee on Finance (SCOF) extend the deadline for the tabling of SAA’s Annual Report to September 15, 2016.”

It is the same motivation given in two earlier requests this year asking for an extension.

Lees pointed out that the statements were due to be tabled in September last year and were therefore already 10 months overdue.

“That is 10 months … that Parliament has not been able to exercise its oversight role, 10 months of no accountability at SAA and 10 months of open defiance of directives issued by the National Treasury.”

Lees said the official opposition believed the extension should be denied and that further government guarantees would only heighten the risk that SAA’s woes posed to the South African fiscus.

The DA blames the delay on a widely-perceived stalemate between the finance minister and the presidency over the SAA board.

When Gordhan tabled the national budget in February, he told reporters he planned to appoint a new board soon to implement a turnaround strategy. Five months later, this is yet to happen, and observers and the opposition see it as part of the ongoing power struggle between President Jacob Zuma and the finance minister he reappointed in December under pressure from business leaders.

“The minister of finance has not been able to implement the turnaround plan that he announced in February 2016. This stalemate between Minister Gordhan and SAA board chairperson Dudu Myeni is rapidly driving SAA to total collapse and simply can’t be allowed to happen to the national carrier.”

Myeni, who is close to the president, lost a tug of war with National Treasury over her plans to renegotiate a contract with Airbus last year.

Last week, SAA was forced into another climbdown when it cancelled the contract with BnP Capital‚ the “boutique” financier it had appointed to help restructure its debt and to raise funds in return for a R256 million success fee.

– African News Agency (ANA)

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