Leon Louw, executive director of the Free Market Foundation (FMF), has issued a R100 000 wager that SAA CEO Vuyani Jarana’s three-year turnaround plan will not work and that by 31 March 2021 – his stated timeframe – SAA will not be in profit.
This excludes any privatisation or business rescue proceedings – both likely being now too late and ruled out by Jarana himself, according to Louw. The condition for this wager is that when Jarana pays the charity, it will be from his own money and not from public funds. “Some may dismiss this as a PR stunt. It is not. It is a serious wager to illicit serious intent about a very serious abuse of public funds,” said Louw.
Is Jarana serious about his turnaround plan? Does he really believe that SAA will make a profit in 2021? Is he so confident of this that he will condone diverting nearly R22 billion from other, far more essential causes of poverty, healthcare and education to fund subsidising the rich to fly? If so, then he has to accept Louw’s wager. To do otherwise shows doubt. It is easy to gamble taxpayers’ money; not so one’s own, according to the FMF.
There have been eight CEOs and at least nine turnaround plans. Total government support for SAA now totals R46bn, while the last time it made a profit was 2012.
The FMF believes Jarana has a very heavy responsibility to shoulder – and if he is serious about his task, he should publically accept this solemn wager. “Not to do so, would show a lack of conviction and faith in his and the SAA board’s ability to fix SAA.”
The FMF has long been vocal on the solution. It believes it is too late for turnaround plans, business rescue or privatisation – although attempting the latter two is better than persisting with the status quo. “SAA is broke and unfixable. The only realistic option left is to close SAA down in a planned and predictable process so that all vested interests – customers, staff, unions, suppliers, creditors and more – know what will happen, how they will be affected and what plans are in place to optimise the process and minimise the pain. Let’s take the political fear out of closing down SAA.”
