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Occasionally David beats Goliath, with this victory against the abuse of tax a classic case in point. Wayne Duvenage, chairman of the activist Organisation Undoing Tax Abuse group, goes back in time to explain how determined citizens, and ultimately taxpayers, fought against a contract that was designed to feather nests – and won the war against strong opponents. Duvenage says a new SAA aircraft should be named “The Whistle-blower” in tribute to the small group who scuppered a cunning plan by SAA chairwoman Dudu Myeni to introduce additional mouths to the feeding chain. Duvenage’s story is a reminder that good occasionally triumphs evil: a welcome message to give South Africans hope at at a time when corruption and the abuse of state funds are overwhelming the news agenda. People like the heroes and heroines named in this saga have saved us all from digging that little bit deeper into our pockets to fund wasteful state spending. The article was first published on Daily Maverick. – Jackie Cameron
By Wayne Duvenage*
As South African Airways took delivery of its first new A330-300 aircraft last week, it was an occasion for which all SAA staff had reason to celebrate. However, it was also one that symbolises a silent celebration by all South Africans for the billions of rand saved as a result of the actions of a few good people who sacrificed so much for the new aircraft’s arrival. South Africa owes an immense gratitude to Sylvain Bosc, Nico Bezuidenhout, Wolf Meyer, Thuli Mpshe, Masimba Dahwa and more recently, Cynthia Stimpel.
This is the aircraft whose name should be “The Whistle-blower” in tribute to a few good people who scuppered SAA chairwoman Dudu Myeni’s plan to insert a middle-man deal that stood to enrich a few connected cronies with hundreds of millions of rand in unnecessary commissions and finance charges, at the expense of the loss-making airline, and all of us.
The new aircraft forms part of five new A330-300s, which started out as an order for 20 new Airbus A320s about 13 years ago. Due to various postponements of deliveries and contract clauses, when SAA started taking delivery of those aircraft in 2014 the price had escalated tremendously since the initial placement of the order.
By 2014, SAA had exhausted its own cash resources and could not self-finance those aircraft. This meant that each new aircraft it took delivery of generated a cash loss of about R160-million. Multiply that by 20 aircraft on the way and the airline, or the Treasury, was facing a massive burden.
At the start of 2015, as part of the 90-day action plan to place SAA on track towards a long-term turnaround strategy, the acting CEO, Nico Bezuidenhout, tasked CFO Wolf Meyer and Chief Commercial Officer Sylvain Bosc with the renegotiation of this onerous contract.
After months of discussions with Airbus, the pair managed to obtain significant concessions from the manufacturer, which enabled the cancellation of the last 10 of the burdensome A320 deliveries and replaced them with a lease for five A330-300s, the first of which arrived at OR Tambo International airport on Friday.
The deal saved SAA and the South African taxpayer about R1.6-billion and enabled SAA to obtain a refund of R1.3-billion in pre-delivery deposits from Airbus. In addition, the deployment of the modern A330-300 aircraft in lieu of the older models also stood to generate operational savings worth hundreds of millions of rand annually for SAA. It was in many respects a good deal all round for the airline and South Africa.
Despite the deal being approved by SAA’s executive team in 2015 along with the Board and National Treasury, its execution was subsequently blocked by Myeni later in the year when she tried to insert a middle-man into the transaction, against the will of the executive team. Those who opposed the “new” deal were removed one by one, firstly Bosc, then Meyer, then Bezuidenhout and Thuli Mpshe, all of whom were replaced by obedient yes-men who would not stand up to Myeni’s antics.
When Minister Nhlanhla Nene refused to allow Myeni’s deal, which would have left SAA significantly worse off than the deal negotiated by Meyer and Bosc, he too was removed by President Jacob Zuma under the most absurd excuse of releasing him for a position with the BRICS Bank, a position which was never there in the first place.
This move hit the country hard and saw the rand plummet by 15% and the JSE lose 10% within days. Hastily, the advisers to Nene’s replacement, Des Van Rooyen, asked for the SAA Airbus documentation on his first day in office at National Treasury. The plot and activities of state capture were already thick and entrenched at SAA.
Tragically, the new deal that Meyer, Bosc and Bezuidenhout had worked so hard on to save the country billions of rands ultimately cost them and others their jobs, they having refused to let Myeni and her cronies benefit at the expense of SAA and the taxpayer.
As it turned out, these fine new A330-300 aircraft that were supposed to save a lot of taxpayers’ money ultimately became the most expensive aircraft ever, due to the burden they added to the country’s debt as a result of the greed, incompetence and dishonesty of a few connected and corrupt cronies. Yet at the same time they may have helped expose the extent of looting of our State-Owned Entities, along with the irrational appointments so typical of our nation’s president, Jacob Zuma.
Ultimately, this transaction has also displayed the immense importance and role that whistle-blowers play in exposing wrongdoing. The extent of the plundering that has and currently takes place throughout all levels of public service necessitates a desperate need for more good people to blow the whistle on corruption, even though it might be at the expense of their careers and personal lifestyle.
South Africa owes an immense gratitude to Sylvain Bosc, Nico Bezuidenhout, Wolf Meyer, Thuli Mpshe, Masimba Dahwa and more recently, Cynthia Stimpel, whose moral courage and actions enabled OUTA to halt a similar transaction in which, again, Myeni and her team tried hard to inject middle-man BnP Capital, which stood to earn over R245-million from an unnecessary finance fee activity.
The real tragedy is the destruction and loss of such meaningful structures, careful planning and expertise at SAA and National Treasury at the hands of a few corrupt individuals who almost got away with their misdeeds.
The delivery of the new A330-300 last week is aptly symbolic of South Africa’s current situation. One can only imagine how terrible Wolf Meyer, Sylvain Bosc and Nico Bezuidenhout must have felt when reading about it, and not being able to be there to take delivery of this new aircraft, one they worked so hard and sacrificed so much for.
- Wayne Duvenage is chairman of OUTA.
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