SAA's Huge Performance Bonuses Worrying

MEDIA STATEMENT RELEASED BY:
MR HENNIE BEKKER MP
IFP SPOKESPERSON ON FINANCE

April 26, 2007

The Inkatha Freedom Party's Spokesperson on Finance, Mr Hennie Bekker MP, today strongly criticised South African Airways for paying their Directors bonuses, while profit margins fell sharply during the 2005/2006 financial year.

"The IFP has previously raised our concerns with Government's R1.3bn lifeline to South African Airways, after their substantial R583m drop in profit from R648m in 2005 to R65m in 2006," said Mr Hennie Bekker.

"We note with further concern today that they have paid-out half of their profit, R37.64m, in bonuses. In fact, a massive R100 million has, since 2001, gone straight into the coffers of SAA's Directors.

"So this begs the question: how can South African Airways be seen as being serious about remedying their financial difficulties when they pay-out half of their profit in bonuses? Performance bonuses should be performance related and with a massive R583m drop in profit, whether these Directors performed or not, is questionable.

"The time has come for Minister Alec Erwin and South African Airways itself to take a long hard look at the company's management. SAA's extensive restructuring to curb revenue loss will only help if they utilise their profits for the company's good and not only for the good of their Directors," concluded Mr Bekker.


FOR FURTHER INFORMATION CONTACT:
Mr Hennie Bekker MP: 083 255 4520
Liezl van der Merwe: 083 611 7470