South African Airways (SAA) Annual Report 2010/11

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Public Enterprises

24 October 2011
Chairperson: Dr G Koornhof (ANC)
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Meeting Summary

South African Airways' Annual Report 2010/11 showed some progress as compared to previous years. The Airline had started the process of fleet renewal and had taken ownership of the new aircraft that it hoped would position it favorably as the airline of choice locally, regionally and internationally. South African Airways had exceeded most of the key performance indicators set in 2010. The key performance indicators that South African Airways did not meet were as a result of global pressures like the oil price increase. Nonetheless South African Airways performed better than their competitors. The staff was on a road to high performance and leadership had been very critical in pushing this culture forward. South African Airways had completed a process of recruiting a world-class team. A growing number of staff members were former employees and this was something new. For the first time the promotions at South African Airways came from within South African Airways ranks. A large part of their spending was in overseas markets on items such as fuel. Areas of particular focus would be on the employment of people with disabilities and youth employment opportunity creation and offering young people an opportunity to gain experience.
South African Airways made progress in both civil and criminal proceedings to address wrong doings identified in forensic reports commissioned by the predecessor board. South African Airways had done a lot of work to tighten oversight and had managed to unmask more wrong doing. South African Airways had laid civil and criminal charges, added more charges and was convinced that it could add even more charges not only against Dr Khaya Ngqula,  the former chief executive officer, but also against others. South African Airways was pleased to tell the Committee that it had retrieved some of the money through collaborations with the the Special Investigating Unit, the South African Police Service and the Asset Forfeiture Unit. South African Airways had made significant progress in competition litigation against the company. South African Airways accepted fully that more was supposed to be done to create better jobs and grow the skills base that was needed for the country to succeed. South African Airways was among the first to launch a partnership with further education and training colleges for training technicians. The intake of apprentices and training technicians was significantly increased.

Some of the financial performance highlights were given. The Group pre-tax profit was R795 million. South African Airways' operating cost went up by 1% with the exclusion of fuel costs. The operating cost went up by 66% and the earnings per share rose. Lastly capital and reserves rose up by 65%.

Committee Members congratulated South African Airways on the recognition of excellence and the awards  won not only by members of the executive but also by members of all of the South African Airways employees. South African Airways did well to control its costs in a very difficult global environment. Concerns that were raised by the Members were whether the South African National Taxi Council was affecting Mango's business, whether South African Airways offered financial assistance to Mango and whether Mango was sustainable and profitable.


South African Airways management wished the Council all the best of luck in its business venture and welcomed more accessibility from low cost carriers. It also highlighted that South African Airways wanted to desist from bullying other people.

Key to the discussion was also the issue of baggage pilferage. South African Airways highlighted that a lot had been done to address baggage pilferage. However baggage pilferage was supposed to be made a priority crime. 


Meeting report

Introduction
An apology was given on behalf of the Chairperson, Mr H Maluleka (ANC). The Committee appointed Dr Koornhof as the Acting Chairperson, who noted that South African Airways (SAA) had made much progress  in the last financial year for which it should be congratulated. However, many challenges remained.

South African Airways (SAA) Annual Report 2010/11 Presentation
Ms Cheryl Carolus, Board Chairperson, SAA, said that it was with a reasonable measure of pride that SAA was before the Committee to share positive results for yet another year. SAA was on the road to sustainability but not withstanding very difficult global economic circumstances particularly for airlines. The oversight instruments and institutions were capable of curbing the excesses that protected SAA against unfortunate global circumstances. In the context of global economic challenges and natural disasters, global airline carriers had had to rely on their shareholders and governments to bail them out. SAA was proud to say that it did not ask for and need a bailout. SAA had started the process of fleet renewal and had taken ownership of the new aircraft that it hoped would position SAA favorably as the airline of choice locally, regionally and internationally. She thanked the Committee Members for being present to receive the first aircraft that was for fleet renewal. SAA had exceeded most of the key performance indicators (KPIs) set in 2010. The KPIs that SAA did not meet were as a result of global pressures like the oil price increase. Nonetheless SAA performed better than its competitors. The staff were on a road to high performance and leadership had been very critical in pushing this culture forward. SAA had completed a process of recruiting a world-class team. A growing number of staff members were former employees and this was something new. For the first time the promotions at SAA came from within SAA ranks. This sent a good message to well performing SAA members of staff that SAA was a place where they could grow. A large part of spending was in overseas markets on items such as fuel. Areas of particular focus would be on the employment of people with disabilities, youth employment opportunity creation, and offering young people an opportunity to gain experience.

SAA made progress in both civil and criminal proceedings to address wrong doings identified in forensic reports commissioned by the predecessor board. SAA had done a lot of work to tighten oversight and  had managed to unmask more wrong doing. SAA had laid civil and criminal charges, added more charges and  was convinced that it could add even more charges not only against Dr Khaya Ngqula, the former chief executive officer, but also against others. SAA was pleased to tell the Committee that it had retrieved some of the money through collaborations with the the Special Investigating Unit (SIU), the South African Police Service (SAPS) and the Asset Forfeiture Unit. SAA had made significant progress in competition litigation against the company. The SAA accepted fully that more was supposed to be done to create better jobs and grow the skills base that was needed for the country to succeed. SAA was among the first to launch a partnership with further education and training (FET) colleges for training technicians. The intake of apprentices and training technicians was significantly increased. SAA would not have been able to fund this on its own because it came at a cost and it was able to do this through effective partnerships with other entities in the public sector and the money put on the table by Minister Blade Nzimande and his Department. Over 4 000 temporary staff members were made permanent. The internal training academy was revised and better relationships were built with trade unions. It resulted in the improvement of the quality of service including food. This result was one of the outcomes of investing in SAA staff. This in turn was one of the major reasons why SAA won major international awards. There were, however, areas that undermined the ability of SAA such as the South African (SA) visa regime especially for Africans that was said to undermine the growth of South Africa. SAA was in consultations through the Department of Public Enterprises with the relevant Departments. There was need for seriousness to address the issue of baggage pilferage better collaboration with the Airports Company of South Africa (ACSA) and the SAPS. Baggage pilferage undermined the confidence in SAA and South Africa as a country. SAA sought to tighten service level agreements with ACSA and other baggage handling companies. To make this effective the SAA needed the support of the Committee to assist SAA in ensuring more successful prosecutions and convictions. Moreover baggage pilferage was supposed to become a priority crime. Ms Carolus thanked all of the elected leaders in Parliament from all the parties from their patience and wise counsel. SAA needed to continue to rely on the cross party oversight.

Ms Siza Mzimela, Chief Executive Officer (CEO), South African Airways, said that SAA offered services to 34 cities on six continents and 20 intra-Africa routes. In the last financial year SAA carried 8.5 million passengers and 129 000 tons of cargo. At present SAA had 68 aircraft in the group. This included the five aircraft that were allocated to Mango, SAA's low cost carrier, and the four airlines used in the cargo section of SAA business. As at the end of March 2011, SAA employed 10 057 employees worldwide.

SAA operated within the mandate or the shareholders compact. For the year 2011/12 the shareholders compact highlighted SAA's strategic role for South Africa. In addition SAA was supposed to positively grow its capital base and financial efficiency in order to ensure a sustainable business, ensure commercial and operational efficiency and effectiveness. This was achieved because SAA and Mango were consistently number one on time performance through out the year. SAA was supposed to cooperate and consolidate its  businesses more and ensure new route development. This was achieved by SAA in that it increased the frequencies of its flights to Lagos, Nigeria and Harare, Zimbabwe. SAA was able to achieve and or exceed all of the key performance indicators set for it by shareholders.

SAA contributed within four distinct areas of the economy namely direct impact: activity and scale growth in the aviation sector such as airport infrastructure development, indirect impact such as activity supporting non-aviation tourism infrastructure development, induced impacts and consumer welfare, such as the general benefits to South Africans from increased tourism.

Oxford Economics had conducted a survey on SAA's economic contribution to South Africa. The study concluded that aviation's catalytic effect on tourism in South Africa was to the value of R23.4 billion as contribution to the gross domestic product (GDP) in addition to the R50.9 billion in other sectors. Furthermore aviation would have created 116 000 jobs in the South African environment. It was further estimated that SAA carried approximately 50% of inbound passengers to South Africa and the effect of this was that SAA contributed around R11.7 billion to the GDP and supported 58 000 jobs.

A brief background was given on the trading conditions for 2010/11. It was another difficult year for the global aviation industry. There was low GDP that meant that there was static passenger and cargo demand. The  traffic had still not fully recovered from the global financial crisis. In addition there was further downward pressure on average fares for all airlines around the world. Another huge challenge was the oil price that continued to move steady around USD 100 per barrel. Additional challenges that SAA faced were outlined, namely the rapidly increase in competition from the Middle Eastern airlines and the fact that SAA had not grown its business fleet for a long period.

Some of the financial performance highlights were given. The Group pre-tax profit was R795 million. SAA's operating cost went up by 1% with the exclusion of fuel costs. The operating cost went up by 66% and the earnings per share rose. Lastly capital and reserves rose up by 65%.

Mr Wolf Meyer, Chief Financial Officer (CFO), SAA, presented to the Committee the annual financial statements and gave a summarized version of the income statement. The total airline income was R22.8 million. The operating profit rose to R807 million up from R487 million in 2010. The profit for the year was R782 million up from R442 million in 2010. There was a positive move in capital and reserves from R2 292 billion in 2010 to R2 941 billion in 2011.

Ms Mzimela gave a brief highlight of SAA subsidiaries. Mango made a pre-tax profit of R0.5 million. It was added that Mango was also able to obtain a  fifth aircraft that enabled it to launch flights from Lanseria to Cape Town and grow new markets domestically. Mango was the only airline that offered customers the opportunity to purchase tickets through the retail group Edcon. SAA Technical posted a pre-tax profit of R63.5 million and had commenced with a major business improvement programme called Project Thrust. A turnaround plan had commenced at Air Chef with stronger focus on increasing third party business. Its pre-tax profit was R 2 million. Lastly there was a renewed focus on providing greater sales support for SAA by SA Travel Centre that reported a pre-tax profit of R1 million.

Highlights were also given on governance improvements across the SAA group. SAA made significant progress towards compliance, in particular PFMA compliance. Legacy tender procedures, whereby timely contract extensions and signing of contracts by both parties were not in place and this resulted in irregular expenditure of R85 million. However none of the individual irregular expenditure items were of amounts that reached the materiality threshold in terms of Section 55(2) of the PFMA. Payment of fines and penalties resulted in fruitless and wasteful expenditure of R2 million. In addition some legacy competition law non-compliance cases were reduced but some cases were still open.

The SAA introduced a manual system for detecting and reporting irregular expenditure and fruitless and wasteful expenditure. Consumer Protection Act compliance training was also being provided. Two foreign  criminal cases were defended successfully, with prosecution discontinued and one foreign civil claim for damages successfully struck from court proceedings. SAA had commenced the electronic tracking of  its procurement process. It was also providing procurement training and awareness building, reviewing competition law compliance and consumer protection policies and compliance training and awareness building. All competition law cases, with the exception of two legacy civil claims (Comair), were resolved. A further two foreign competition law criminal cases were not proceeding to prosecution and one foreign civil claim had been settled.

Looking ahead to the current trading conditions, it was said that the global and African market trading conditions were deteriorating. The International Monetary Fund (IMF), World Bank and the Organisation of Economic Cooperation and Development (OECD), all forecast a low growth cycle. Some Middle Eastern carriers continued to ignore economic cycles and continued to add capacity. They also managed to negotiate a high number of traffic rights with African countries. The oil price was one of SAA's concerns. Oil was settling in the range of USD 105 per barrel and fuel could be 1/3rd of SAA's costs.

In terms of skills development SAA had trained 2 243 group employees in terms of functional training and
5 574 employees in legislated and licensing training. In addition 3 794 employees were trained in corporate skills management, leadership and management development.

A brief synopsis was given on the current employment equity. Top management comprised of 30% female and 20% male. In senior management out of 29 staff 23% (11) were female and 31% (18) were male. Out of the 97 pilots only 9 (1.2%) were female and 88 were male. Only 0.58% SAA staff members were people with disabilities.

Looking ahead SAA was positioned for growth. SAA needed to grow its operations and it had launched and would continue to launch new passenger and cargo routes for example to Ndola and Beijing. SAA was committed to delivering its strategic objectives for the state, including facilitating trade and economic development in an environmentally and socially responsible manner.
The awards that SAA had received were outlined. These included the Skytrax Award, Ubuntu Award, Global Airlines Magazine and the Air Cargo News to name a few.

Discussion
The Acting Chairperson congratulated SAA on the recognition of excellence and the awards won, not only by members of the executive but also by staff members from amongst all of the SAA employees. SAA did well to control its costs in a very difficult global environment. The Committee Members had visited SAA Technical and they were there on the floor. The Committee was happy that the SAA managed to turn SAA Technical around because it was not only an asset for SAA but for South Africa and the continent as well. It was a major achievement for SAA that it had addressed the legacy issues. There were however negative policy issues that SAA needed to address with the help of the Committee.

Mr C Gololo (ANC) thanked the SAA for a very enlightening presentation. He asked how many aircraft did SAA lease and how many were fully owned and paid up. He further asked how the SAA relationship was with the pilots, how do it maintained that relationship and from where SAA sourced its pilots.

Mr P van Dalen (DA) requested for the correct figures on the baggage pilferage because it seemed as if ACSA, SAA and SA Express all had different figures. The World Cup was a reflection that the baggage pilferage could be addressed. Someone was supposed to take responsibility for baggage pilferage. He asked how the South African National Taxi Council (SANTACO) would affect the Mango, SAA's low cost airline.

Mr S van Dyk (DA) asked what type of assistance and support was SAA offering to Mango, whether SAA offered financial assistance to Mango and whether Mango was sustainable and profitable.

Ms C September (ANC) asked what were the major legacy issues that were bothering the SAA, what were the major challenges at the governance level with the Board and what had been done to further familiarize SAA staff with the provisions of the PFMA Act. In addition she asked what SAA did with its profit, whether the profit assisted SAA to clear its debts and when would SAA be able to clear its debt completely.

Mr A Mokoena (ANC) echoed the remarks that the other Members had made on the excellent performance by the SAA. He said that the performance by SAA was an honor and it made Members of Parliament feel good. He asked whether there was collaboration between the SAA and SA embassies abroad in marketing SAA. He asked how Mango had performed on the Durban-Cape Town route, whether it was coping and how had SAA done in terms of market penetration in Africa. He suggested that there was supposed to be more Africaness in the image of SAA such as the attire of the staff and the food.

The Acting Chairperson highlighted that the Committee had visited Brazil and was told by the SA embassy in Brazil that Cape to Rio was a possible profitable route and asked whether SAA looked at the possibility of flying on the route. He asked whether SAA was utilizing training facilities in conjunction with other role players at OR Tambo, what progress had been made on the 2010 KPMG report and whether SAA had secured the air service licenses. In addition he questioned whether SAA management and the Board had attempted to address the issues, such as control deficiencies, that had been raised by independent auditors.

Ms Carolus responded that SAA was a people business and if people were treated fairly and they would  know what to expect. Such treatment would create a big difference. SAA had a good relationship with its pilots and this was supposed to be credited to the CEO who managed to be tough but fair. For the first time she was invited in her capacity as chairperson of the SAA board, to speak at the Annual General Meeting of the Airline Pilots Association of South Africa. Black and white pilots, men and women, were encouraging young people in rural areas and townships to become pilots. SAA was dealing with its staff honestly and firmly. She shared the same irritation as Mr Van Dalen with regard to baggage pilferage. There was need to see people being prosecuted and going to jail. An important step in the process was for staff to know that they were not supposed to steal passengers’ luggage. SAA welcomed further engagement on the matters. Nonetheless SAA had declared war on baggage pilferage. She reassured that the Committee that the PFMA was very important to SAA. Both compliance and best practices were critical for the business. Compliance was supposed to be easy but there was need to go beyond compliance. SAA was sitting with a new CFO because it was of the opinion that the former SAA CFO was incapable of providing proper compliance and leadership around the financial management. The KPMG report was not just about theft and wrongdoing but also about flagrant disregard and violation of the PFMA. Some of the matters that were raised in the report were addressed. There was need for staff to understand that they were not supposed to run fast and loose with people’s money. SAA had recovered a few million Rands through the Asset Forfeiture Unit. On the KPMG matter the law was supposed to take its course. There were both civil and criminal proceedings that SAA had instituted. There was progress on the part of criminal proceedings where SAA had served summons on Mr Ngqula. SAA was very confident about the case. The matters that SAA had brought for civil proceedings were matters that the SAA thought it could win. Mr Ngqula had responded to some of the allegations but some of the responses were frivolous. The Board wanted to see more progress on the criminal side but the matter was now out of its hands. On the civil side SAA made sure that it pushed  its lawyers more. She referred the Committee to the National Prosecuting Authority (NPA) for a progress report on the criminal case.

Mr Teddy Dhaka, Non-Executive Board Member and Chair of SA Technical, South African Airways, responded that the performance of Mango was what SAA expected it to be. By putting a full service airline on the Durban-Cape Town route SAA was loosing around R13 million. SAA managed to turn this around and was now making R2million net profit a month as a result of the change. Mango was a 100% owned subsidiary of the SAA Group. As a shareholder SAA had certain responsibilities such as ensuring the success of the subsidiary. When it came to the purchase of fuel, both companies combined their mass to negotiate the purchase of fuel. This was not considered as a subsidy for Mango but it was only prudent that SAA had the purchasing power to negotiate. The critical mass of the group was also used to purchase a fifth carrier for Mango. Hence Mango did not receive any subsidies. Mango was a profitable business despite the fact that the profit was low. However SAA expected the profitability of Mango to continue growing. In addition it was too early to decide on the impact that SANTACO would have because SANTACO was starting on a route that Mango was not deployed on -  the Johannesburg-Mthatha route. The SAA welcomed competition as it helped SAA. More SANTACO planes would be to the benefit of South African consumers. In response to the question on the cooperation between Denel and SA Technical he said that a forum had been established between Denel, SAA, SA Technical and SA Express. Armscor and the South African Air Force (SAAF) were also invited to the discussions. The discussion related to how state-owned entities responded to the challenges on growth and ensured that they trained as many people as they could not only for their industry but also for related industries. A review was conducted and it was realised that one of the challenges at SA Technical was that traditionally it trained local people only because there were no accommodation facilities. SA Technical got to realise that Denel had an 800 bed training facility which it only used about a third because there was no huge demand hence SA Technical would be using the facility to train staff. It was noted that most of the first year training that was provided by the state entities was more or less the same, hence SA Technical was looking to have Denel train people during the first year, then SA Technical would take over in the second year of training when people specialised. In terms of governance the SAA Board did not have major challenges that caused sleepless nights. The Board had resolved most of the legacy governance issue. A number of committees had been established all of which were chaired by non-executive directors. A management forum was also established to look at matters that related specifically to the PFMA. From a governance point of view the Board was functioning well.

Ms Mzimela responded that 54 of the SAA aircraft were on operating leases and seven were on financing leases meaning that SAA would only own seven aircraft after it paid for the seven aircraft in full. On the pilot side SAA management had a very good relationship with pilots. Pilots were taken from smaller airlines because pilots were required to have flown a minimum number of hours from the smaller airlines. Pilots were also recruited from the SAAF. Currently SAA and the SAAF were having discussions which would enable SAA to recruit pilots from the SAAF and at the same time enable the SAAF to use some of the SAA pilots as and when SAAF was in need of pilots. SAA had been very vocal on baggage pilferage. Baggage pilferage was totally unacceptable and this had a direct impact on the financial performance of SAA. The regional operations where most traders  were flying through were the most affected area. As such traders were beginning to avoid South Africa because they did not have any guarantee that their goods were safe. SAA had undertaken a joint project that was called project zero which involved SAA, ACSA, and SAPS, ground handling services and the security services. In the first meeting they clarified the correct number of incidents of baggage pilferage. ACSA counted the incidents that had been reported as opposed to SAA's method of  counting per bag. As a result of the initiative there had been some progress on baggage pilferage on both the domestic side and the international side but the regional side remained a problem.

Ms Carolus added that there were syndicates that targeted traders. As such baggage pilferage was supposed to be made a priority crime.

Ms Mzimela responded that she was not in a position to give the Committee the actual number of incidents of baggage pilferage. There was a decline of 58% on the domestic side, a decline of 25% on the international side and an increase of 45% on the regional side. The profit that SAA made helped SAA to strengthen its balance sheet, which remained weak. SA embassies abroad and SAA took a view that they were Team SA together, hence they worked closely with one other. In addition, the SAA food menu had a number of South African meals on it such as pap and umngqusho. SAA had received positive comments from passengers with regards to the traditional flavours.

Mr Meyer replied on matters on emphasis that one of the issues was the air traffic liability guarantee that required SAA,  in terms of international and domestic air service acts,  to cover passengers who had bought tickets but had not yet flown. SAA had secured guarantees as of the 1st of October. The other matter of emphasis was the restatement of numbers that stemmed from a difference in treatment. Previously the maintenance reserve deposits were fully expensed and later, as the maintenance events, occurred SAA could claim back on the deposits. Because of improved operational and internal control SAA understood what the recoverability of the deposits was and SAA was in a position to capitalize it and not write off the full amount, hence the adjustments to the restatement of previous year's numbers. SAA had strengthened its balance sheet by R1.3 billion.

Mr Dhaka responded that SAA had looked at the Cape to Rio route but it did not look like a profitable venture. As a general comment, he said that there were a number of places that SAA wanted to go to but there was need for SAA to have a strong balance sheet.

Mr M Sonto (ANC) highlighted that the state owned enterprises (SOEs) had registered tremendous progress and such progress was rebutting the perception that SOEs could never be profitable. He asked whether SAA was comprised mostly of women and whether SAA was at home with gender equity issues.

Mr Mokoena asked what the net asset value of SAA was, what the real problem was between SAA and Comair and whether there were any issues between SAA and the Civil Aviation Authority.

Ms September asked why SAA started Mango when they had a problem with cash, why had SAA not started a low cost airline internally and what was the financial motivation behind Mango. She suggested that as part of the job creation programme SAA was supposed to look at cooperative partners and that the Committee was supposed to consider seriously  that SAA shareholders provide an oversight report on SAA.

Mr Van Dalen stressed that the chairperson of the SAA Board was brave because she was not afraid to give the Committee actual figures. He asked whether the remuneration of stewards was internationally benchmarked. OR Tambo airport was where baggage pilferage was. He suggested that someone on the SAA Board or in management investigate the matter.

Mr Gololo asked how many years it took for one to qualify for first class travel from the Voyager programme, what was the number of claims the SAA had faced with regards to baggage pilferage and how claims had SAA settled.

The Acting Chairperson highlighted that in 2008 the SAA had reversed a decision to sell air shares. He asked whether the decision that had been made was correct. He asked how visible SA leadership was both at the level of the management and the Board in order to focus on the problems faced by clients, and what the vision of SAA in the next financial year was.

Ms Carolus responded that SAA management and Board were required to spend at least one day a week at the entity and were required to keep an office where people and staff could come in at any time. A lot of steps had been taken in becoming visible because visible self-leadership was very important. Mango worked for SAA. Airlines had two models on low costing. One was in-house like British Airways and Comair and the other was to run the low cost airline separately. Mango was treated as a different cost structure. SAA welcomed more accessibility from low cost carriers. SAA had changed its mindset from being a dominant player to a market leader. The notion for promoting flying to the public was good for the people of South Africa because it reduced road carnage and provided people with more time on their hands. She wished SANTACO the best of luck in its venture. SAA wanted to desist from behaviour that bullied other people. With regards to the air shares SAA had made the right decision. SAA could do it at a much more affordable price because there was no third party and with much more sensitivity.

Ms Mzimela added that the reason why Mango had to be separate was because in order for SAA to offer cheaper fares it also had to have lower costs. Mango's costs were almost half of the SAA costs. The net asset value for SAA was R2.9 billion. In addition SAA salaries for cabin attendants were the best in South Africa. Furthermore SAA continued to benchmark its salaries. SAA provided its staff with a basic salary and allowances. Moreover SAA provided every one of its cabin attendants with a fair chance to go to various destinations. SAA management had done tremendous amounts of work to ensure that it was visible. Every executive was expected to visit a number of stations. She had personally done road shows and moreover SAA had open days for each of the various areas within SAA such as cabin crew or ground crew where SAA management took the time to share to the staff, not only things that pertained to their own areas but also what happened in the organisation. There was a positive reaction to the open days from SAA staff. She highlighted that the chairperson of the SAA Board was asked to visit one the SAA stations when she visited Ghana for personal reasons. Lastly the challenges that SAA had with civil aviation were more operational than anything else. However SAA continue to work very hard on the relationship.

Ms Sandra Coetzee, General Manager: Legal and Compliance, said that the Comair civil matter dated back to conduct in early 2000. It was a legacy matter where the Competition Commission had found the SAA guilty of non-competitive conduct. As such Comair instituted civil proceeding for damages as a result of the impact of the conduct. SAA was engaging with Comair to resolve the matter at the lowest possible cost.

The Chairperson congratulated SAA for its excellent achievement. There were, however, challenges that the SAA faced. There was, however, need for the SAA and the Committee to work as a team. The Committee would compile its Committee report on the SAA Annual Report. The Committee's report would then be tabled and debated in the National Assembly.

The meeting was adjourned.



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