The contract of South African Airways chairwoman Dudu Myeni has been extended until the company’s annual general meeting, set down for early November, Deputy Minister of Finance, Sfiso Buthelezi confirmed on Wednesday.
Buthelezi told Parliament’s standing committee on finance Myeni’s term was due to end at the end of August based on the Memorandum of Incorporation (MoI) section 13, which grants the minister to extend the contract of a board member.
He said Finance Minister Malusi Gigaba wrote to Myeni and asked her to serve until the AGM, prompting Economic Freedom Fighters (EFF) chief whip Floyd Shivambu to ask whether the minister had the power to make the decision alone or whether Cabinet approval was needed.
“What was the letter that was extended and what is the legal standing of the letter,” he asked.
However, Parliament’s Advocate Frank Jenkins said section 13 does not grant provisions for the minister to extend a contract of a single board member but grants provisions for the entire board.
“The minister sought a legal opinions on this matter and was advised that there is a provision to extend the contract,” said Buthelezi
He also agreed with Buthelezi’s interpretation of the law. “I agree with the deputy minister that there can be different interpretation of the MoI before the court,” said Jenkins.
Myeni who is not present at the meeting due to tooth extraction according to deputy minister, was the only board member that has her contract extended by the minister.
MPs then asked to be given copies of the minister’s letter to Myeni and asked if this extension has been approved by cabinet.
The airline is briefing the committee on its latest quarterly report.
SAA currently relies on government guarantees of some R20 billion to stay in operation and international ratings agencies have cited it as a threat to the country’s economy. Gigaba is expected to make an announcement on recapitalising the airline in October.