The Board of Airline Representatives of South Africa (BARSA) briefed the Portfolio Committee on its activities and issues pertinent to tourism airlift prospects and challenges within SA in a virtual meeting.
BARSA said the aviation and tourism sector is greatly challenged by the COVID-19 pandemic and it resulted in massive job losses. Also, the 72 hours polymerase chain reaction (PCR), COVID-19 pre-entry test for passengers and airline crew members, poses problems for crew members. Restrictions on countries permitted to enter South Africa for business and leisure also poses difficulty. Some airlines have consequently reduced its frequency to South Africa, because of the uncertain regulatory environment, and are considering other African countries as its hub. This poses a huge risk for South Africa, as it may lose its current status as the hub and tourism attraction to Africa.
BARSA asked the Yamoussoukro Declaration by all African countries be ratified, to enable African airlines to regain ease of doing business, and to grow the economies of its countries. BARSA said there needs to be a reduction in taxes and tariffs for landing fees, aircraft parking fees, and passenger services charges, to allow travel cost to be reduced. The road to recovery will take until 2024, and would be tedious, long, and uncertain. Deep structural airline business model change is needed, and airlines should form part of the discourse for recovery.
Members asked what extraordinary measures should immediately be taken to increase demand and supply for domestic and international air tourism, in light of the effect of the COVID 19 pandemic and the effect of regulations on air travel; what should be done in relation to government reducing the price of travelling to South Africa (SA) from anywhere in the world; what the biggest risk to South African air travel potential is at the moment, for government to be aware of it and take action to mitigate against it; and what the agreed resolutions or points of conflict between BARSA and the Minister or Deputy Ministers office are.
Members also asked what BARSA’s role is regarding the challenges of delayed or cancelled flights; what role BARSA plays in addressing these challenges; how the international community will be convinced there is a need for a short-term plan for international travelling recovery; if BARSA has any recovery plan for creating jobs, as there is an indication over 250 000 jobs were lost; what the relationship is between BARSA, Airports Company of South Africa (ACSA), and Air Traffic and Navigation Services (ATNS); and what BARSAs influence is on the Aviation Bills.
The Committee wanted to know what the attitude and response of government is to opening up the skies, in BARSA’s discussions with government; what the reasons are for BARSA believing South Africa is losing its spot as an attraction to Africa, and as the Hub; what government’s attitude to South African Airlines (SAA) is, how SAA is financially crippling government, and how government is handling it.
The Chairperson said he had internet connection problems, and he appointed Ms L Makhubela-Mashele (ANC) to chair the meeting in the event he gets disconnected.
Members welcomed delegates from BARSA. The Committee looked forward to interactions with BARSA, because of the very important role it plays in the airlines services sector. This also has a great impact on tourism. The Committee said it needs a detailed overview of BARSA, its activities, partnerships, and what makes it sustainable and relevant. It needs to know which relationships the Committee could build, to help strengthen BARSA, which would in turn boost and grow the economy of South Africa through tourism.
The Committee is focused on issues relating to tourism in South Africa, and is aware tourism activities currently take place mainly between Durban, Cape Town, and Johannesburg. The existing structures of tourism in South Africa need to be sustained, protected, and transformed. This is to enable it respond to the challenges of poverty, inequality, and unemployment, which are linked to tourism. Poverty, inequality, and unemployment, are more pronounced in villages, townships, and small towns. The Committee’s objective is to grow and transform the tourism sector, and extend this growth and transformation to areas where poverty is more pronounced, such as villages, townships, and small towns.
BARSA Airlift Prospects and Challenges
Ms Carla Da Silva, BARSA chairperson, said BARSA strives not just to grow businesses, but to give back and encourage members within the communities where BARSA serves.
BARSA appreciates the Committee for its invitation, and affirmed it would continue to support the Committee as a strategic partner, while ensuring its agenda aligns with the government agenda. Tourism and aviation go hand in hand, and BARSA in partnership with the government can work together towards reigniting, restarting, and growing this sector of the economy.
Ms Zuks Ramasia, BARSA CEO, thanked the Committee for the invitation, and said BARSA is glad to collaborate and work closely with the Committee. Members of BARSA comprise member airlines across Africa, and internationally.
The first member of BARSA is South African Airways (SAA), the national carrier. It has an automatic and permanent seat of deputy chairperson of BARSA. Every country has its own BARSA - the SA in the acronym refers to South Africa.
Currently, only two out of the airlines coming into South Africa are not members of BARSA. However, talks commenced with one of the airlines, while the second airline does not belong to Board of Airline Representatives (BAR) in any country it flies to.
BARSA works closely with several departments, government bodies, regulatory bodies, and associations. It provides airlines with relevant country information, sector regulations, and requirements, while ensuring business continuity.
Some challenges faced by BARSA include regulation of a 72 hours polymerase chain reaction (PCR) COVID negative pre-entry test, for passengers and crew members. This regulation constituted hardship especially for crew members, who in the course of duties, have to travel between countries and may not be able to adhere to the 72 hours test period.
The restricted list of countries permitted to enter South Africa for tourism leisure also accounts for the reduction in tourism within South Africa. South Africa needs to urgently reclaim its spot as the Hub and centre for tourism.
Greater collaboration is required between BARSA, tourism, and other departments, to promote tourism into the country. BARSA works closely with the Airports Company to ensure airport infrastructures are fit for its purpose, safe, suitable, and usable by its members.
BARSA also works with airlines to reduce cases of delayed or cancelled flights. Accurate weather services are provided, and tariffs are negotiated to ensure it is competitive and encouraging for tourists to come into South Africa. Environmental standards and practices are supported in collaboration with The International Civil Aviation Organization (ICAO) and the International Air Transport Association (IATA).
Ms Da Silva said the aviation industry is a real economic enabler, promotes tourism in the country, and contributes immensely to job creation. The COVID pandemic however had a devastating effect on the sector, as many small travel agents, hotels, and tour operators, had to close down. The big travel consortiums and operators had to downsize and restructure. The sector needs to be urgently reorganised, and jobs recreated, as most employees in the airports are South Africans.
Strong collaboration is encouraged between BARSA and government, to enable BARSA to support government and influence government regulations positively.
On regional challenges, airline operators are financially distressed. Bilateral air service constraints need to be removed to enable more air access, and make it possible for more airlines to fly. On regional prospects, air service connectivity between African countries should also be increased.
The CEO of BARSA said the road to recovery will take until 2024, and would be tedious, long, and uncertain. Deep structural airline business model change is needed, and support must be given to the national carriers to improve its capacity and increase its efficiency. Airlines should form part of the discourse for recovery, and South Africa should collaborate more with other African countries.
Mr H Gumbi (DA) wanted to know to what degree the Committee engaged with airlines and the air travel sector to advance domestic and international tourism. He also asked what extraordinary measures should immediately be taken to increase demand and supply for domestic and international air tourism, in light of the effect of the COVID 19 pandemic and the effect of regulations on air travel; he asked what should be done in relation to government reducing the price of travelling to South Africa (SA) from anywhere in the world; what the biggest risk to South African air travel potential is at the moment, for government to be aware of it and take action to mitigate against it; and what are the agreed resolutions or points of conflict between BARSA and the Minister or Deputy Minister’s offices.
Ms M Gomba (ANC) wanted to know about the engagements of BARSA with the various departments, particularly its experiences with SA tourism and aviation. She also asked what BARSA’s role is regarding the challenges of delayed or cancelled flights; and what role BARSA plays in addressing these challenges.
Mr M De Freitas (DA) said the presentation shows skies need to be opened up, as it currently stands as the biggest hindrance to travels within Africa. He asked what negotiations, discussions, and interactions BARSA had with government regarding this, and what the attitude and response of government to opening up the skies is. Secondly, he asked what the reasons are for BARSA believing South Africa is losing its spot as an attraction to Africa, and as the Hub. He asked what government’s attitude to South African Airlines (SAA) is, how SAA is financially crippling government, and how government is handling it.
He said he needs more clarification on tariffs and taxes, in view of how it affects the costs for local and international airlines, and he asked how BARSA wants government to deal with it. On the issue of a trade-off, the presentation gave the impression if international airlines are encouraged then somehow local airlines will be prejudiced. He asked why all airlines cannot come into South Africa and the country still benefit from its entry.
Ms P Mpushe (ANC) said BARSA must continue its good work to ensure the airports are fit for its purpose, and continue ensuring economic activities are kept alive, and the sector is not badly affected by the pandemic. It is pleasing to know BARSA assures the Committee it is capable and ready to ensure the rate of infection does not go high now regulations are relaxed. The Member said she hopes BARSA continues to be efficient and viable….[continued speaking in a different language which was not interpreted at 1:54mins]
She also asked how BARSA ensures airport infrastructure is intact; if there is a budget set aside for this purpose, or if BARSA only provides guidance in ensuring the airport infrastructure is intact. There are local airports such as the one in Eastern Cape, which needs to be expanded to meet international standards.
Ms Mpushe asked if BARSA engaged the Minister and Deputy Minister on its presentation. There needs to be clarification regarding if BARSA is asking for a review of the rules. It is evident these rules need to be reviewed. Lastly, she asked how BARSA conducts its work, if it is comprised of one body, or if there is an online service which it uses to monitor compliance, especially in respect of the COVID regulations.
Mr K Sithole (IFP) wanted to understand BARSA’s recovery plan. The presentation said 2024. He asked how the international community will be convinced there is a need for a short-term plan for international travelling recovery. He asked if BARSA has any recovery plan for creating jobs. There is an indication over 250 000 jobs were lost. He asked what the relationship is between BARSA, Airports Company of South Africa (ACSA), and Air Traffic and Navigation Services (ATNS); and what BARSAs influence is on the Aviation Bills.
Mr T Khalipha (ANC) referred to the issue raised by BARSA regarding regulations on the 72 hours COVID negative pre-entry test, and asked how it caused difficulty for the sector. He asked if the Committee can engage with the concerned Ministers, and see how these regulations can be amended, and the sector assisted. Employees are not part of travellers, and employees’ positions must be reconsidered. The Department of Health is also key in the interaction.
Following the Committee Chairperson’s remarks on the current situation of airports in rural areas, he asked about BARSAs strategy towards assisting with the upgrade of these airports, and ensuring business is facilitated in those areas. He asked which district modules are put in place to facilitate and market district and domestic tourism.
He also asked what governments response to BARSA in the course of its interactions with it was, particularly related to tourism and home affairs. The Committee should interact with the Portfolio Committee and Minister of Home Affairs, to address the various issues raised regarding tourism. There should be a specific focus on domestic tourism, which can survive when there are challenges with international tourism.
Ms Da Silva addressed the question on the extra-ordinary measures BARSA is taking to increase demand and generate revenue. BARSA is faced with the first challenge of the ‘permitted’ list of countries, allowed to fly into the country, versus the ‘not permitted’ list. The ‘not permitted’ list consists of airlines which can only fly into the country for business, and not for leisure. BARSA understands and supports the government’s reasons for its decision, but the decision is preventing and creating job losses. To reignite tourism and stop job losses within the aviation sector, tourism, and in broader spaces like tour operators, hotels, and car rentals, the demand for business travel which includes leisure should be expanded. However, most of the international leisure clients are from the ‘not permitted’ list. BARSA therefore finds it very difficult to answer the question.
The second challenge to increasing demand and generating revenue is the cost. When an airline enters into the country, payment must be made for airport traffic navigation services, Airport Company South Africa, civil aviation, and several stakeholders, are paid different fee structures. These fee structures are not reduced, despite the effect of the pandemic. Governments around the world are aiding and reducing these costs so airlines can fly into the country. However, these costs are not reduced in South Africa, for example ACSA fees, landing and parking fees, are not reduced, despite appeals and demands for incentives or small reductions during the COVID period, to increase demand.
The cost of flying and doing business in South Africa is therefore very expensive, and the ‘not permitted’ list is also not allowed to enter South Arica for leisure. The airlines on the ‘not permitted list’ are therefore only able to fly into the country with very small numbers, and this is not sustainable. BARSA has appealed to the airlines to allow it to liaise with government in the short term, and show it is highly regulated, and observes necessary health protocols at all touch points. BARSA is hopeful the list will be opened up and more leisure allowed into the country.
Regarding what can be done to reduce the cost of travelling, it is important to note the cost involved in flying an aircraft, the landing and parking fees, ground handler fee to refuel, catering company, payment of all stakeholders, and taxes on all airline ticket. To reduce the cost of travelling, the total cost for doing business needs to be reduced. International Air Transport Association (IATA), as the international body, appealed to governments around the world to give financial aid to its airlines, and several governments gave these financial aids to its national carriers, thereby reducing the cost of doing business.
Another challenge increasing cost is where there is a destination with high demand, and few flights. While BARSA cannot tell airlines what to charge, it however encourages the airlines to remain competitive and allow for more demand into the country.
On the biggest risk to air travel, hub status and opening up the border, BARSA had several meetings with ICTA Board airline members, and other stakeholders to ensure South Africa does not lose its hub status. This is more challenging because many countries opened up their borders and have no strict entry regulations or quarantine rules. Some of the international carriers started considering establishing its hubs in other African countries. It is important borders are opened, even if in a phased manner, to ensure South Africa’s Hub status is not lost.
BARSA is successfully managing and mitigating this risk. The government listened, and border re-opening commenced. Challenges still exist with the countries not allowed to enter for leisure and not business. BARSA will continue lobbying in a responsible manner on this issue.
On the agreed resolutions and points of conflicts, the biggest concern was when other borders started opening up, BARSA appealed to the government, and showed all its protocols and how it adheres to all sanitary and safety measures. Now more airplanes flying across Africa are in the air and there are more economic activities. This will help tourism tremendously. BARSA is also ensuring all airlines adhere to government requirements.
On BARSA’s engagements with the departments and experiences with South African Tourism (SAT), there were lots of engagements, presentations, submissions, and paper works. BARSA continues to provide comprehensive information and intelligence on happenings in other countries, best practices, and what other airlines are doing. Support is also given to the government in making regulations. BARSA aligned with the strategic agenda of the Department of Transport, and also needs to align with the strategic agenda of the Department of Tourism.
Replying on BARSA’s role in delayed and cancelled flights, Ms Da Silva said there are two airline associations in South Africa. One is BARSA, which oversees international airlines, including South African Airways. The other is African Airline Association, a domestic association which oversees domestic airlines. BARSA focuses on Africa and international, which includes South African Airways. There are many reasons why flights are delayed or cancelled, sometimes it is technical, other times it is due to the protocols which must be adhered to. Where BARSA gets specifics on flight cancellation, BARSA approaches the flight to demand an explanation. Because demand is much lower currently with the restrictions in place, some flights try to amalgamate the flights or look at different operations to ensure it is sustainable.
Regarding the open skies, there was a series of discussions and treaties signed by a number of bodies and airlines to open up skies. The Northern hemisphere for example, Europe opened up its skies without restrictions, and airlines can now fly from one country to the other without regulations and restrictions. Africa has not been able to achieve this, and BARSA continues to lobby and negotiate to see the skies are opened up, visa regimes are relaxed, and travel costs reduced. The border has now been opened and gradually more countries are added to the list which can enter South Africa for economic activities and leisure.
Ms Ramasia said, in 1999, there was a Yamoussoukro declaration by all African countries. The objective was to open the skies to ease movement between African countries and promote business and trade, but nothing has been done yet. The skies need to be opened to allow for freedom for Africa to carry on its activities for its own benefit. This will also encourage trade and more economic activities.
BARSA works closely with the local rescue practitioners of SAA to re-establish itself, supports national carriers, and provides expert assistance. Government’s decision on SAA is still awaited.
On tariffs and taxes, all airports are managed by a government entity. BARSA works closely with ACSA, Civil Aviation Authority (CAA), Air Travel Negotiation Services, and South Africa Weather Services. Efforts are being made to influence the tariffs and reduce the cost of aviation business in South Africa, and enable airlines to fly as it used to. There has not been any reduction or incentives achieved at the moment, but BARSA will continue appealing for these reductions and concessions.
The effect of the pandemic was felt by all sectors, including the government who experienced limitations and financial constraints. BARSA will keep requesting tariff reduction, but is also conscious these tariffs must be sustainable. BARSA will continue appealing to the government to open the border, so state owned entities can also have an opportunity to make money.
On how the Committee can help the airlines in the wake of the challenges it faces, the rules do not differentiate between travellers and crew members. The 72 hours may sometimes not be workable with crew members who fly through several countries. Airlines will not fly into South Africa if it is subjected to several stiff rules. The Department of Health really needs to review this rule to find out if it is workable or not.
Ms Gomba took over chairing the meeting, as the Chairperson had connectivity problems.
Mr De Freitas asked for clarification regarding if there is a trade-off, because BARSA’s presentation said if international airlines are allowed, then local airlines will suffer.
Ms Da Silva said if international and African airlines do not fly into the country, then it will affect the domestic airlines who are feeders into the respective places or specific city. South African Airways gets money for the domestic feeder, and it is important to have international airlines fly.
Ms Ramasia said, on the 72 hours regulation, BARSA understands passengers need a 72 hours negative polymerase chain reaction (PCR) negative test, but for the crew, the 72 hours test should not be required as crew are continuously in the line of duty.
On the issue of what BARSA is doing in regarding villages, townships, and rural areas, there is deep involvement and a variety of programs in all the provinces, to expose youth to aviation.
The Acting Chairperson thanked the members from BARSA for the presentation and released them from the meeting.
Mr Jerry Boltina, Secretary of the Committee, said a revised Portfolio Committee programme was circulated to Members, which will last until the end of November. In the last meeting, the Chairperson said the Minister was about to table the Annual Report of the Department, and SAT. The Department’s Report was tabled last Thursday, and will be circulated to Members. The SAT Annual Report is not tabled yet, but there are indications it is in its final stages.
A revised programme was sent to Members, which includes an interaction between the Committee, and the Auditor-General (AG) on 3 November, where the AG can talk to the Committee on the Department’s audit outcome, and that of SAT.
A follow up meeting will also be held between the Department and the Committee on 10 November, to enable the Department to table its Annual Report before the Committee.
On 11 November, SAT will be invited too. This will enable the Secretariat to administratively deal with report writing. Regarding the meeting with COGTA, it is proposed the meeting be scheduled for 24 November.
The programme was adopted.
The minutes of the last meeting of the Committee was also adopted.
The meeting was adjourned.
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