5 December 2012

South Africa: Denel Maintenance Contracts - Time for the Minister to Intervene

press release

The Minister of Public Enterprises, Malusi Gigaba, must convene a meeting with relevant stakeholders to provide clarity on the future of AMG's aircraft maintenance contract with state-owned defence equipment manufacturer Denel.

Last year June, the Department of Defence gave notice that it would be cancelling its contract for aircraft maintenance with Denel Aviation.

Hanging in the balance are the livelihoods of 523 aircraft specialists who through the contract have been employed to service aircraft for the department.

Negotiations between the department and the parastatal have been on-going since the announcement with the promise of renewal hinted at in the last few months.

However, reports in the media now suggest that SA air force Chief Major General Zakes Msimang has confirmed that the contract will "definitely" not be renewed.

In addition to the uncertainty over the possible renewal of the contract, a further dispute seems to have ensued as to which party would ultimately be responsible for the severance packages of the retrenched workers.

With the contract set to conclude at the end of March 2013, an urgent resolution needs to be found that will be fair on all relevant stakeholders.

The DA therefore urges the Minister of Public Enterprises, Malusi Gigaba, to urgently intervene in this matter. The Minister should mediate discussions between Denel and the SA Air Force to bring about clarity on the future of the AMG contract.

I will be writing a letter to the Minster in this regard.

It is precisely this sort of uncertainty that effectively renders planning in public enterprises ineffectual, wasting public funds and destroying jobs in the process.

Natasha Michael, Shadow Minister of Public Enterprises

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