Denel not meeting personnel and oversight commitments


With just five Parliamentary working days left in 2021, it appears the delayed Denel annual report is not going to be put under oversight scrutiny of any sort this calendar year. At the same time the onslaught from employee organisations seeking settlement of long outstanding salary and employee benefits continues.

Gauteng-based UASA (United Association of SA) continues its lengthy legal battle for salaries and benefits to be paid to its Denel members and yesterday made it known, to date, it’s been 50% successful.  Denel met “only half” its contractual obligations to UASA members, spokesperson Abigail Moyo said.

In August 2020 the Labour Court ordered Denel to pay all outstanding obligations to UASA members. This week Denel asked for an extension until August next year to comply fully with the order; Judge Reghana Tulk ruled the matter postponed to 16 March.

Another trade union – NUMSA (National Union of Metalworkers of SA) – also went the legal route seeking payment of salaries and employee benefits. In mid-November, the North Gauteng High Court in Pretoria ruled in favour of the union, saying outstanding monies had to be paid within 10 days of the court order. Centurion-headquartered Solidarity racked up a number of court appearances against Denel and was told it can attach Denel assets for disposal in settlement of outstanding salary and employee benefit payments.

In mid-October, Public Enterprises Minister Pravin Gordhan used Parliament’s announcements, tablings and committee reports (ATCs) mechanism to make it known three of the State-owned enterprises (SOEs) under his control will submit annual reports late.

He named the beleaguered Denel defence and technology group alongside ports and pipeline company Transnet and West Coast-based diamond extraction operation Alexkor. In terms of the Public Finance Management Act (PFMA), annual reports and financial statements of SOEs should have been tabled at meetings of the Portfolio Committee on Public Enterprises (PCPE) by end-September.

Apart from using the word “late” in the ATCs, Gordhan gave no further indication of when annual reports will appear – neither month nor year.

Democratic Alliance (DA) deputy shadow public enterprises minister Michele Clarke at that time was quick to seize on the non-publication of Denel’s financial statements as well as the ministerial delay in informing Parliament.

This week she told defenceWeb the continued non-appearance of annual financial statements from Denel is “yet another indication it simply doesn’t have either the financial or operational capacity to meet deadlines of any sort”.

Gerhard Ueckermann, UASA divisional manager, said after this week’s Labour Court appearance Denel’s inability to comply with court orders was “concerning”.

“Despite continued judicial oversight by the Labour Court Denel fails to prioritise implementing the court order.

“UASA members employed by Denel suffered for the past 16 months without full salaries. This has a huge negative impact on livelihoods and families including financial responsibilities. It was and is still an emotional journey with some members on the brink of suicide.”

Denel owes employees around half a billion rand in salaries and benefits. Last month it initiated voluntary severance packages for non-critical staff.