in Business & Finance

South African opposition takes Myeni's appointment to court

Posted 13 September 2016 · Add Comment

South Africa's largest opposition party, the Democratic Alliance said it is taking legal action against the South African government following its controversial decision to reappoint Duduzile Myeni as the chairwoman of South African Airways, reports ch-aviation.

President Jacob Zuma's cabinet ratified SAA's new board of directors putting to bed months of speculation about Myeni's future at the loss-making national carrier. The resolution of SAA's perennial leadership woes was one of the preconditions Finance Minster Pravin Gordhan had demanded SAA meet before it could access a ZAR5 billion (USD351 million) state-backed guarantee needed to finalize its 2015/16 accounts and retain its status as a going concern. 

However, the leader of the DA, Mmusi Maimane, on Monday said that in his party's opinion there was enough prima facie evidence to build a case against Myeni's reappointment given the parastatal's poor financial performance and the persistent scandals it has endured during her four-year tenure.

"Her reappointment not only reeks of nepotism and cronyism so common under the Zuma administration, but it also flies in the face of the need for good governance at State-Owned Enterprises (SOEs), especially SAA, which is in financial ruins - failing to make a profit for several years - and a whisker away from being liquidated," he said. "Our legal action thus seeks to have the reappointment of Ms Myeni set aside as being wholly irrational. We contend that Ms Myeni is an unfit and inappropriate appointment as she is incapable of steering the national carrier in the right direction."

The DA alleges that under Myeni, SAA has sustained growing losses while failing to adhere to the Public Finance Management Act which requires SOEs to table finalized accounts within a specified timeframe. It also alleges that several operational decisions were taken on political, as opposed to commercial, grounds.

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