FIRST COSTED AT R3.15 BILLION, by the time Durban’s King Shaka International Airport was completed in 2010, it had cost any-thing between R7.6bn and R9bn.
This kind of cost overrun is chicken feed when stacked against Eskom’s Medupi and Kusile power stations, but it set in motion a chain of events that helps explain some of the bizarre decisions coming out of Airports Company of SA (ACSA).
King Shaka is one of the nine airports managed by ACSA.
In February, Minister of Transport Dipuo Peters fired half the board of ACSA, ostensibly to strengthen it, but left in place CEO Bongani Maseko who was fingered last year in a forensic report that detailed several instances of procurement irregularities.
This is just one instance of political interference in the running of ACSA. A far graver interference was the decision in 2006 to force ACSA to build the King Shaka International Airport without a feasibility study having been carried out and in defiance of all commercial logic. This decision lumbered ACSA with crippling debt which it has been forced to service ever since.
In March this year, minority BEE shareholders in ACSA brought an application before the High Court in Pretoria challenging the “commercially illogical” decision by the airports regulator to lower tariffs by 35.5%, which would cut revenue by R1.8 billion by 2018 and remove all prospect of the company’s being able to declare a dividend to shareholders.
The tariffs went into effect on 1 April, but the matter has now been placed under judicial review. These tariffs benefit airline operators and passengers, but not ACSA shareholders, who long ago gave up hoping for a decent return on their investment.
Just a few years ago, in 2011, when ACSA had completed a massive airport upgrade programme, it was granted a staggering 133% increase in tariffs by the regulator. Why would ACSA now apply for a reduction in tariffs? None of this makes much sense unless, as minority shareholders have argued, one understands that ACSA has abandoned its commercial mandate due to political meddling.
This story is from the May 2017 edition of Noseweek.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the May 2017 edition of Noseweek.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Sign In
Lennie The Liquidator Faces R500,000 Defamation Suit
After losing his cool when his fees were questioned
Panel Beater De Luxe
Danmar Autobody and its erstwhile directors get a serious panel beating in court papers. Corruption and theft are said to have destroyed the firm chaired by Nelson Mandela’s eldest daughter, leaving 200 workers destitute and threatening to kill.
Meet Covid Diarist Ronald Wohlman
Ronald Wohlman – EX SOUTH African copywriter, author, and actor – never dreamt that his lockdown diaries, written on Facebook and followed by people all over the world – would become his “life’s work”.
A Picture Of Peace?
Beware: Appearances can be deceptive
Flogging A (Battery-Driven) Dead Horse
Why plug-in vehicles are not all they’re cracked up to be– and, likely, never will be
Everybody Drinks Corona
I am hesitant to go Into the pub today. Not because it’s illegal, but there is a crème colored 1985 Mercedes 300D parked behind the pine tree. This means the devil is inside; that’s what we call Dr. De Villiers. You don’t know whether you will encounter the good doctor with the charming bedside manner or the violent, bipolar bully. The problem is, most of the time, you can never be sure which it is, so it’s best to always keep a social distance.
Never Take A Hypochondriac To A Pandemic
From Ronald Wohlman’s New York Corona Diary
The money train
Transnet in court battle with liquidators of Gupta-linked audit firm over R57m in ‘corrupt’ payments and invoices
‘He's no pharmaceutical genius, he's a vulture'
Pharma con seeks prison release to ‘help find Covid cure’
Bush school – A memoir
OUR SCHOOL WAS IN THE MIDDLE of the bush, ten miles from the nearest town in the harsh beauty of the Zimbabwean highveld. It started life in World War II as No 26 EFTS Guinea Fowl, a Royal Air Force elementary flying training school and I arrived there in 1954, just seven years after it became an all-white co-ed state boarding school.
