Citizen Reporter
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2 minute read
28 Jul 2021
10:15 am

Mango in crisis because of DPE ignoring ‘rampant looting’, says Numsa

Citizen Reporter

Mango Airlines will be placed under business rescue, following financial difficulties which culminated in staff not receiving June salaries.

Picture: Gallo Images/Darren Stewart

The National Union of Metal Workers of South Africa (Numsa) has blamed the Department of Public Enterprises (DPE) for the crisis that South African Airways (SAA) subsidiary, Mango Airlines, has found itself in. 

This is after it was announced on Monday that Mango would be placed under business rescue, following financial difficulties.

The severely distressed airline also confirmed the suspension of its flights, with immediate effect, due to non-payment to Air Traffic Navigation Services (ATNS).

Mango has also not paid staff salaries for June and July.

Mango crisis could have been avoided

Numsa spokesperson Phakamile Hlubi-Majola told Power987 on Monday that the union’s calls to place Mango under business rescue, when SAA did same in April last year, had fell on deaf ears.

“We raised our concerns from the start. When government had initially announced that SAA was going to be placed under business rescue, we proposed that the same thing should happen for its subsidiaries. However, we were ignored when we made that proposal unfortunately,” she said.

Hlubi-Majola said the union had no choice, but to approach the High Court in Johannesburg with an application to force Mango to be placed under business rescue, due to more than 700 jobs being at risk in the face of a potential liquidation.

She further said the situation that Mango had found itself in at the moment could have been avoided if DPE had “simply done their job”.

“SAA collapsed because DPE closed its eyes to decades of rampant looting. They did nothing so SAA collapsed and now as a result of its failure Mango is in a similar position after one of its creditors filed for the airline’s liquidation,” she added.

Negotiations

Numsa, alongside Mango Pilot’s Association and the South African Cabin Crew Association (Sacca), have been in protracted talks with SAA and the department for weeks, extending a hand of collaboration to ensure the airline’s survival.

As it stands, Mango’s shareholders – led by Public Enterprises Minister Pravin Gordhan – are withholding a R 819 million bailout due to the lack of a business plan that SAA’s board was allegedly tasked with developing.

Mango’s debt is reportedly about R2.5 billion.

Meanwhile, Numsa has since also asked for Ralph Lutchman from Concord Administrators to be appointed as the business rescue practitioner.

Additional reporting by Cheryl Kahla and Hein Kaiser