A mass exodus of members of the South African Airways Board in 2012 came on the back of repeated untruths and downright hostility from then Public Enterprises Minister Malusi Gigaba.
Gigaba allegedly lied when he notified the Speaker of Parliament that SAA’s annual September 2012 annual general meeting had been postponed due its audited financial statements not being ready while he had had them in hand for nearly a month.
This was part of startling testimony by former chairperson, Cheryl Carolus, at the State Capture inquiry on Thursday when she lifted the lid on a series of deeply disturbing events that culminated in her resignation and that of seven Board colleagues at the time.
The airline’s AGM needed to have been held before the end of that month, but had been held up by a delay in securing a government guarantee to satisfy the market of its status as a going concern.
Apart from boosting its borrowing prospects, this guarantee was vital as the airline’s management team intended to go shopping for more fuel-efficient aircraft to cater for more profitable routes it planned to introduce.
During a lunch-time meeting with Gigaba, the former minister allegedly told Carolus it was all sorted and that he couldn’t believe his office had not provided the approval document from National Treasury.
She contacted her fellow board members and assured them that the AGM would be held by the legally required deadline before the end of that week.
But the next morning she was confronted by a front-page newspaper article quoting Gigaba’s note to the Speaker about why the AGM had been cancelled.
“This was patently untrue,” she testified.
She called an urgent board meeting and announced her decision to resign, upon which several colleagues joined her, plunging the airline into crisis with unnecessary negative headlines.
The group left after agreeing that they could not continue working with a shareholder (Gigaba) who was openly hostile and “nasty” in his dealings with the board, something that had undermined the integrity and reputations of those involved.
Besides, they had by then already had resolved that they didn’t have his support in view of various public utterances Gigaba had allegedly made.
One of those, said Carolus, related to him telling the Cape Town Press Club that SAA had no strategy, no vision and that some of them were “unpatriotic”.
Again, she said this was simply untrue, because the airline had presented its strategy to the department of Public Enterprises each year as required and had had quarterly meetings at which outcomes were monitored.
Gigaba’s statement, she told the Commission, was inappropriate and “quite nasty”.
But long before the final straw, Carolus and her team put up with all sorts of weird and wonderful requests from Gigaba or his then legal adviser, Siyabonga Mahlangu.
It is understood that Mahlangu intends to present a response to Carolus’s testimony at the Commission, a move that may subject him to cross-examination.
She testified how Mahlangu was party to a meeting convened by then Public Enterprises DG Tshediso Matona, who tried to persuade them to let the Gupta-owned newspaper, The New Age, in the door after lower-level management had agreed to less desirable terms.
Gigaba and Mahlangu also repeatedly tried to get the state-owned airline to give up a lucrative route between Mumbai and Johannesburg to hand it to an Indian competitor airline, Jet Airways, Carolus said.
This was despite the board having placed the route as central to part of its turn-around strategy.
Although the route was not profitable at the time, this was because it had been used as mere point-to-point travel between the two cities.
During her tenure, SAA had realised that it presented extensive value by turning it into a network of routes with Johannesburg as a hub or transit point for passengers seeking to fly onward to South America and into the rest of the African continent.
But here was Gigaba and his adviser allegedly trying to have them virtually hand over a part of the state-owned airline’s business to an outside entity.
The first attempt was made at a meeting at Gigaba’s office where SAA executives were made to sit and wait for three hours so they could be berated by the president of Jet Airways who demanded they drop the route.
Gigaba, she said, sat back oblivious to the irregularity of this shocking spectacle.
The Mumbai route had previously come up in the testimony of former ANC MP Vytjie Mentor, who said the Guptas allegedly offered to make her the minister of Public Enterprises and in return, she would need to ensure that SAA canned the route.
Mentor is scheduled to be cross-examined in due course.
Gigaba’s predecessor, Barbara Hogan, also testified how she was accosted by a Jet Airways representative during an official state visit to India when he sought to discuss this with her.
Carolus said her departure and that of the other board members was more like “constructive dismissal”, and believed this was to make way for a more compliant board.
Several months later, Dudu Myeni, who had served on the board during Carolus’s tenure, would become the new SAA chairperson.
This would mark the beginning of years of turmoil for the airline, which had enjoyed relative stability during the tenure of the previous board, led by Carolus and a management team under seasoned airline specialist Siza Mzimela.
Carolus said that to this day she remains baffled by how Gigaba , previously regarded as one of the rising young political stars in the ANC, had fallen into this this untoward mess.
“He is not stupid. He is intellectually astute. But here was a grown person getting up to what was just madness.”
She told the Commission that it has since become clear what Gigaba had fallen into as he is quite central to a lot of wrongdoing at state-owned entities.
Gigaba’s unravelling began long before Carolus, his political superior, stepped into the the witness box.
In case there was any confusion, the former ANC deputy secretary-general presented her credentials at the start of her testimony. She is a businesswoman and activist who has survived banning orders, detention and torture in her fight for justice and a free South Africa.
She said she was part of a lucky generation who were old enough to have lived through the horrors of institutionalised racism, sexism and violence and young enough to have been part of the generation that got to build a new country — one that now needs to claw its way back from years of devastating corruption.
It was against this backdrop that Gigaba would be exposed, several times, as a nasty, malicious speaker of “untruths” during his controversial stint at Public Enterprises. DM
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