R85m SAA contract collapses as Tribunal flags procurement failures - IOL
The Special Investigating Unit (SIU) has secured a Special Tribunal judgment setting aside South African Airways’ (SAA) decision to extend an R85.34 million dry-lease agreement with Flyfofa Airways for a Boeing 737-300 freighter.
According to the corruption watchdog, "the Tribunal found that SAA’s decision, through its Board, to extend the lease without any procurement process and/or approval from the National Treasury for deviation, for 36 months at a total cost of R85,340,863 from 1 July 2019, was not taken in accordance with a procurement system that was fair, equitable, transparent, competitive and cost-effective, as required by Section 217(1) of the Constitution."
The Tribunal has also ordered Flyfofa to provide the SIU’s attorneys, within 30 days of the 11 September 2026 order, with a detailed account of all money received from SAA and the costs actually and properly incurred in performing the agreement.
The company must also account for the period when aircraft ZS-TGG was grounded and any substitute services provided during that time.
"The Tribunal further ordered Flyfofa to pay the SIU within 14 days any amount shown by account to constitute profit or unjustified enrichment, together with interest at 11% per annum from the date of the order."
The SIU’s investigation found that SAA had effectively ceded its domestic overnight freighter operations to Flyfofa.
Evidence before the Tribunal showed that SAA had previously assessed Flyfofa’s financial position as “high risk”, citing the absence of audited financial statements, a solvency ratio of 0.1 and losses in the preceding two financial years.
Judge Fortuin criticised the conduct of the SAA Board, despite its members not being cited as respondents.
“The SAA Board’s conduct in the matter warranted criticism,” the judge said.
“This conduct has a cost, and it is not only to the SAA alone. This is a cost to the public,” he added.
The Tribunal ordered that the judgment be sent to the minister responsible for SAA, its directors and board chairperson to consider whether further action should be taken.
