South African Airways will now face probing from special government investigators upon the President’s orders. The President of South Africa stated in a 31 January government gazette that he believed the airline to have operated corruptly. He also raised suspicions of maladministration.
The President calls for an investigation
According to a government gazette, South African Airways will now be investigated in connection with allegations of corruption, maladministration, and unlawful conduct. The gazette was published three days ago on 31st January 2020 and it states:
“…the Special Investigating Unit are to investigate as contemplated in the Act, any alleged: (a) maladministration in connection with affairs of the SAA; (b) improper or unlawful conduct by the officials of the employees of the SAA; (c) unlawful expenditure of public money or property…”
The extensive document continues to list allegations that will be investigated, including travel rebates. Notably, it also nods towards issues with Airbus aircraft. The declaration states that the airline’s contract for the acquisition of its Airbus needs to be investigated.
According to Planespotters, the majority of South African Airways’ fleet is made up of Airbus aircraft. It has 47 of them including four A350XWB. However, government documentation does not suggest which of the Airbus orders or aircraft are in question.
What does this mean for South African Airways?
Undoubtedly, this topic is a sensitive matter for the cash-strapped airline. As recently as this week, the airline received a donation of $239 million to maintain its operation. The funds came from the Development Bank of South Africa and gave renewed hope to the airline. Whilst it has always relied on government bail-outs, the new funds prove that there is a vested interest in keeping the airline alive.
However, this new government investigation will not do the air carrier any favors. Particularly since the proclamation in the government’s gazette states that the airline needlessly lost money. According to Flight Global, the airline incurred financial debts that could have been recovered.
Will South African Airways be able to pull it back?
At the moment, there is no suggestion as to how long the investigation will last. Despite this, we can assume it will drag on for quite some time since the Special Investigating Unit is taking into account documents from as early as 2002.
Suggestions of corruption at South African Airways certainly aren’t new. There’s been conflict between trade unions as well as job losses due to maladministration in the past. With that in mind, it’s unlikely that South African Airways will come away from this investigation unscathed.
However, if it does manage such a feat, will its prospects look any better?
Well, South African Airways has a tide of misfortune trailing it. It’s constantly sought money to resurface its operations which doesn’t bode well for the future. With its most recent bailout, what’s to say things will change? It will certainly need to cut back on some of its operations and work on its management.
That said, it’s always hampered by its non-ideal location in the world. South Africa is not the best of places for transiting and takes a particularly long time to get to from most places in the world.
Recovery for South African Airways might be possible with a drastic operational shakeup. As for the outcome of the government investigation, only time will tell.
How do you think South African Airways will fare during the investigation? Let us know your thoughts on this story in the comments.