Cabinet steps back from SAA and Takatso deal investigation

The cabinet has opted to refrain from intervening in parliamentary investigations concerning the cancelled South African Airways (SAA) and Takatso deal.

This decision was announced by Minister in the Presidency, Khumbudzo Ntshavheni, on Thursday.

Minister Gordhan to oversee proceedings

Ntshavheni emphasised that Public Enterprise Minister Pravin Gordhan was well within his jurisdiction to oversee the proceedings related to the deal.

She clarified that the separation of powers between the cabinet and parliament delineates that parliamentary investigations are beyond the purview of cabinet deliberations.

“The separation of powers still apply, so we will not comment. And the minister is entitled to act in accordance with what he felt had to be done,” Ntshavheni said.

The decision to step back comes in the wake of Gordhan’s announcement earlier this month. In it he declared the termination of the deal to sell a 51% stake in SAA to the Takatso consortium.

SAA assets reassessed

One of the primary hurdles encountered during the negotiation process was the need to reassess SAA’s assets. This was due to the significant time elapsed between the initial agreement and the finalisation of the share sale. Gordhan attributed the termination to the post-Covid-19 market impact, which prompted a re-evaluation of SAA’s value.

The revised valuation fell short of Takatso’s original offer, with the airline’s business valued at approximately R1-billion, and its property at R5-billion.

Gordhan further stressed that the decision to terminate the deal was not influenced by external pressures. He said it stemmed from a mutual agreement reached due to the lack of a clear path forward.

However, subsequent developments have fuelled further scrutiny into the collapsed deal. The Portfolio Committee on Public Enterprises unanimously recommended an investigation by the Special Investigating Unit or other law enforcement agencies. The recommendation  was due to allegations of irregularities surrounding the deal.

Minister accused of irregularities in the initial deal

This after the department’s former Director-General Kgathatso Tlhakudi accused Gordhan of orchestrating the sale to benefit specific individuals. Tlhakudi alleged that Takatso was not among the initial bidders, and that SAA’s assets were undervalued. Takatso was handpicked as the preferred bidder. And signatures on sale documents, including his own, were forged, he said.

In response to these increasing concerns, Minister Ntshavheni asserted that Cabinet cannot intervene in matters pertaining to Minister Gordhan and the Portfolio Committee. She stressed the importance of allowing Parliament to conduct its investigations independently.

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