Gordhan announces an executive chairperson for crisis-hit SAA

Public Enterprises Minister Pravin Gordhan has appointed embattled South African Airways acting board chairperson Thandeka Mgoduso as executive chairperson, in order is to shore up capacity at the crisis-stricken airline.

This means Mgoduso, who also chairs the SAA board’s remuneration sub-committee, becomes an executive director and will become more involved in SAA’s operations.

In a rather strange arrangement Zuks Ramasia — the current acting chief executive — will remain in her position and will work alongside Mgoduso.
As an operational chairperson Mgoduso becomes the accounting officer, creating a situation where there are effectively two CEOs at SAA.

Mgoduso confirmed her appointment by Gordhan on November 19, adding that current Ramasia would remain in her position.

Her appointment, Mgoduso reiterated, was not a reflection on Ramasia’s performance since taking over after the resignation of Vuyani Jarana. Jarana resigned in June citing lack of support and meddling by the shareholder as one of the reasons.

“I think that the role played by an executive chair focuses mostly on more strategic issues while working very closely with the CEO.”

“Essentially the appointment by the shareholder is about appreciating that SAA is in the eye of a storm,” Mgoduso said.

“The airline is facing a plethora of issues, notwithstanding the recent strike we’ve just come out of. There are operational, financial, and commercial challenges while we still have to work closely with stakeholders and be available for parliamentary select committees.

“We need to keep our presence alive while we rebuild SAA,” she added.

SAA has been without a permanent CEO andMgoduso also said the process of appointing a permanent CEO was at an advanced stage and a shortlist of three candidates “will serve on the board on Thursday”. “Once the full board has decided a final recommendation will be given to the shareholder,” she said.

Mgoduso’s appointment comes as SAA on Tuesday told workers, in a communication on its intranet, they would receive only 50% of their salaries on Wednesday as a result of financial challenges. The balance, the communication said, would be paid on Monday.

The announcement, penned by Ramasia, followed an earlier communication last week that salaries were not guaranteed for this month. The airline is struggling to secure R2-billion in funding to meet operational requirements.

“As the leadership, we remain seized with the matter of attending to our liquidity challenges, we are giving it priority attention and with the shareholder and lenders this past weekend as we seek to speedily to find a resolution on this matter, including to access the currently approved guarantees,” the communication read.

The airline, whose chronic mismanagement and funding challenges has seen it swallow R29-billion between 1999 and 2017, has recently agreed to a 5.9% wage increase it cannot afford with striking unions.

The agreement, which was clinched last Friday, ended a seven day action that downed all domestic flights and cost about R50-million a day.

On Monday, the airline’s management and unions met to chart a way forward on its intent to retrench 944 jobs at the airline. The Mail & Guardian understands that SAA intends to shed 95 of its 479 management jobs, while 849 of the 4 717 non-management staff will join the ranks of the unemployed.

Mgoduso’s appointment is likely to be badly received by labour as she, along with fellow board member Martin Kingston, were singled out or attacked by unions who accused them of corruption and mismanagement.



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