SAA executives must pay for price fixing

Natasha Michael, DA Spokesperson on Public Enterprises
10 June 2012

South African Airways’ (SAA’s) R18 million fine for fixing ticket prices on its Hong Kong-Johannesburg route is an indictment of the company’s management.

A decision must have been made at some level that it was a good idea to overcharge South Africans on the route to Hong Kong. That person has now lost SAA, and by extension the South African government, R18 million.

If SAA was a private enterprise, the individual or individuals responsible would face serious consequences and would most likely be fired on the grounds of gross negligence. I will demand that SAA apply the same level of professionalism in dealing with the people responsible for fixing prices on the Hong Kong-Johannesburg route.

SAA’s Chief Executive Officer, Siza Mzimela, must appear before the Portfolio Committee on Public Enterprise to give a full report on what her company is doing to identify the guilty parties and implement appropriate sanctions.

SAA’s management has not covered itself in glory in the recent past. Since 2004/2005 SAA has received R18 billion in state-sponsored bailouts. On top of that, the company has requested another R6 billion bailout this year.

This price-fixing fumble is yet another setback for the airline and cannot go unpunished. Those responsible did not only bring the airline into disrepute by overcharging South Africans, but also caused a massive financial loss for the company.

If the Democratic Alliance were in national government, we would privatise SAA and save the government billions in bailouts. Until then, we will hold the Department of Public Enterprises and the SAA management to account to limit the leakage from the public purse.