SAA, Denel “golden handshakes” cost R246.6 over 10 years


Huge payouts to the failed departing CEOs of South Africa’s aviation and defence parastatals have cost the South African public at least R246.6 million over the last decade. Democratic Alliance MP Pieter van Dalen says this needs to be viewed in the context of R243.2 billion in financial assistance to state owned enterprises (SOEs) including Denel and South African Airways in the last four years.

Van Dalen, the DA’s deputy spokesman on public enterprises was commenting on a claim lodged by former electricity utility Eskom’s CE, Jacob Maroga for R85 million. Maroga left the utility under a cloud and amid much controversy. Van Dalen says if paid, it would “be just the latest in a series of staggering salary payouts to unsuccessful executives”.

He says previous payouts in aviation and defence include:

The R8 million settlement received by former South African Airways (SAA) CEO Khaya Ngqula, “after he was fired for his role in the R1 billion tender rigging saga in 2009.”

In 2004, the former SAA CE Andre Viljoen received R3.6 million on top of a salary of R2.2 million and a performance bonus of almost R1-million. During Viljoen’s last two years at the helm of SAA, the company made losses amounting to R15 billion.

Before that in 2001, former SAA CE Coleman Andrews, an American, received a record-breaking golden handshake of R232 million, even though the airline posted a net loss of more than R700 million for that year.

Former Denel chief executive Victor Moche, “who was fired from his position by Public Enterprises Minister Alec Erwin, walked away from the parastatal with a golden handshake of about R3 million in 2005.”
“This list, it should be noted, is limited only to payouts received by departing CE’s of parastatals. The culture of golden handshakes, however, extends far beyond that …; recent examples of [former Public Protector] Lawrence Mushwana (R7-million) and [National Director of Public Prosecutions] Vusi Pikoli (R7.5-million) illustrate precisely that point.”

The [ruling] ANC’s [African National Congress] concept of a developmental state places specific emphasis on the primacy of parastatals, Van Dalen adds. “We cannot continue to pay for incompetence like this. This is money that could – indeed must – be spent on ensuring that parastatals deliver quality services to the public that they are required to, or, otherwise, ought to have gone to addressing the urgent social problems we face in the domains of education, housing and healthcare. Instead, it goes into the pocket of ANC cadres who ran parastatals and the economy into the ground.”