Ricochet News

SAA to cut more jobs as opposition wants chairperson gone

SAA to cut more jobs as opposition wants chairperson gone

Troubled national carrier South African Airways (SAA) has announced the slashing of almost 500 jobs amidst ongoing financial constraints.

Addressing Parliament’s Standing Committee on Finance earlier today, new acting SAA CEO, Musa Zwane, said management had taken the decision to cut 484 positions in an attempt to once again operate at a profitable level within three years.

“SAA continues to rely on debt funding on the back of government guarantees. This is extremely costly and contributes to the erosion of SAA’s capital base,” Zwane said.

“There has not been a capital injection and National Treasury has indicated there will not be any. The estimated cost of funding for the 2016 financial year will be in excess of R1-billion. SAA can be turned around without a capital injection, however, given the current macro-economic environment, this will only likely to occur in five years’ time”.

Zwane, who previously served as SAA Technical Head, became the struggling airline’s seventh CEO in less than four years following his appointment on Tuesday in place of Human Resources boss, Thuli Mpshe, who took over the position at the end of July when Nico Bezuindenhout returned to his position as CEO of low-cost airline Mango.

Opposition parties have meanwhile hit out at controversial SAA Chairperson Dudu Myeni, following reports of her wanting to a change sections of a lease agreement with French plane maker Airbus, which could set the crash strapped parastatal back another R1.5-billion.

“She seems resolute on destroying this entity. She has lost all support, evidenced by the resounding vote of no confidence in her by SAA pilots,” Democratic Alliance Shadow Minister of Public Enterprises, Natasha Mazzone, said in reference to the carrier’s Pilot’s Association voting for the passing through of a no confidence motion in Myeni.

“If South Africa is to weather the economic storm ahead, we need to be able to ensure that every single rand is spent wisely and on the right projects. We simply cannot afford to waste any more money on a national carrier that is not profitable”.

In a similar reaction, Economic Freedom Fighters (EFF) Deputy President Floyd Shivambu said the entire board needs be dissolved in order to prevent “us from being inconvenienced”.

On Tuesday, SAA Chief Financial Officer Wolf Meyer announced his departure four months after former Chief Strategy Officer, Barry Parsons, accused the board of being dysfunctional.