The Zondo Commission’s final report, handed over earlier this week to President Cyril Ramaphosa, has called for law enforcement agencies to investigate a South African Airways (SAA) ground-handling contract awarded to Swissport.
“SAA’s conclusion of a five-year ground-handling contract took place a month after Swissport had concluded a service level agreement with JM Aviation in terms of which JM Aviation was paid R28.5 million. That money, according to Dulaxolo Peter, was then used to pay millions of rands to those who had assisted in “facilitating” the finalisation of the SAA/Swissport contract,” reads the report.
This included Vuyisele Ndzeku, who held directorship in both JM Aviation and Swissport. Ndzeku last year testified to the Commission that he had not disclosed to Swissport that he was a director at JM Aviation, denying any conflict of interest.
The report, however, expresses its concerns over the R28.5 million, stating these payments were likely to have been kickback payments to those who had secured the conclusion of the Swissport ground handling contract with SAA.
“The Commission recommends that the law enforcement agencies should further investigate the role of Swissport,” according to the report. It also calls on the National Prosecuting Authority to look into the matter.
The report states that the ground-handling contract was awarded by SAA to Swissport South Africa, a subsidiary of the Swiss-based cargo and aircraft ground handling services provider, in 2011 for five years. “The contract with Swissport was never actually signed or concluded but it nevertheless provided the services to SAA. An amount of R1.139 billion was paid to Swissport without any contract being in place during this period.
“In 2016, SAAT eventually decided to conclude a contract with Swissport for a further five years, notwithstanding that the original tender awarded in 2012 was for five years, expiring in 2017, and notwithstanding that no further procurement process was carried out before this occurred. The contract value would therefore end up being double the original tender value.”
A condition of the contract was that Swissport would subcontract some of its services to BEE companies. In terms of the agreement, SAA selected a BEE partner that Swissport would work with and chose JM Aviation.
The Commission’s investigations revealed that a payment of R28.5 million was made to JM Aviation in March 2016, the month before the ground handling contract between SAA and Swissport was finally concluded.
According to the report, it has not been possible to get to the bottom of the matter as Swissport declined invitations to meet with the Commission’s investigators and legal team. According to the Zondo Commission, however, there is strong evidence that corruption took place based on two facts.
“Swissport’s inability to provide any documentary confirmation that genuine services were provided by JM Aviation to Swissport in exchange for the R28.5 million it received a month before the ground -handling contract was concluded between it and SAA; and what JM Aviation did with the money. If services were genuinely to be rendered under the contract with Swissport, JM Aviation would likely have had to pay salaries and made at least some purchases to equip itself to provide the services. However, the bank statements of JM Aviation show that no such payments were made. Instead, the money came into the account and, within a matter of days, it was paid out to those connected with SAA.”
Speaking on condition of anonymity, several industry experts have said an investigation into what occurred between SAA and Swissport is necessary.
“This is especially important considering that the Airports Company of South Africa will only adjudicate its ground handling licence applications next month. As it currently stands, nothing is stopping Swissport from getting another licence, despite all the allegations going around.”
