Numsa approaches ConCourt in bid save struggling SOEs

The National Union of Metalworkers of South Africa (Numsa) has filed papers at the Constitutional Court (ConCourt) in a bid to force parliament to intervene in determining the future of South Africa’s major state-owned Entities (SOEs), with specific reference to beleaguered SA Express (SAX) and Denel.

SAX’s finances have deteriorated and the airline had to be placed under business rescue last year after it could not pay billions in debt it owes to its creditors.

Denel on the other hand is all but insolvent and has struggled to pay staff salaries for months.

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Numsa said the purpose of its ConCourt application is to compel the Portfolio Committee on Public Enterprises and the Standing Committee on Accounts (Scopa) to hold public hearings on whether SAX or Denel, or any other similarly placed SOE should be permitted to go insolvent, and consequently to be liquidated by a court.

The union wants the ConCourt to grant it direct access on this issue.

Numsa said SAX and Denel are on the verge of collapse and laid the blame for the state of the SOEs on Finance Minister Tito Mboweni and Public Enterprises Minister Pravin Gordhan’s door.

Numsa’s general secretary Irvin Jim said the collapse of the parastatals was due to decisions taken by the ministers.

“Parliament’s portfolio committee on public enterprises or Scopa and ultimately the National Assembly itself, should be the ones to make the determination on whether SAX and Denel or any other major SOE should be liquidated,” Jim said in a statement on Monday.

“This is not something that the courts should be given the power to decide on purely from a liquidation perspective given the strategic role these companies play in the economy and the development of the country. Should these entities no longer be regarded as strategic assets of the state, then parliament must pass a resolution on this and legislate accordingly.”

Denel workers under pressure

Denel workers have gone without salaries or only 20% of their pay each month for months now. It has been reported that two of the company’s employees have taken their own lives, while others have lost their cars and many stand to lose their homes.

Jim said thousands of families are going through unbearable suffering as a direct result of “Gordhan’s uncaring attitude towards workers”.

He claimed the department of public enterprises has not lifted a finger to help any workers at SOEs.

“All our attempts to get assistance have fallen on deaf ears. There are mechanisms in place that government as the shareholder, could have implemented to cushion workers, but they simply refused to act.

“This has been the case at SAA, SA Express, and all SAA subsidiaries including Airchefs, Mango and SAA Technical. Workers at all these entities have had to go without their salaries for months at a time.

“Government wasted R231 million on the business rescue process in respect of SAA and the [business rescue practitioners] BRPs earned a whopping R78 million, but workers at SAA and its subsidiaries starved and they continue to suffer.”

Additional reporting by Ina Opperman.

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