THE more I learn and hear about the Competition Commission the greater my worry. It is fast out of the starting blocks when it comes to tackling the iniquities of those bad guys in the private sector, but when it comes to the public sector the same commission cannot hear the starter’s gun.
The issue this time round is the low-cost airline industry, which has been at sixes and sevens ever since poor 1time fell on the skids and disappeared into the witches’ cauldron. Not that Kulula, Mango or South African Airways have been complaining. In fact, Mango released a statement a week ago telling us it had just posted its best December holiday season yet.
As I now understand things, Blacky Komani and his close managers had good reason to believe 1time was about to be rescued. That was when the African newcomer, London-listed Fastjet, appeared on the scene. It bought Fly540 from Lonrho and has made it plain it wants to develop a continent-wide low-cost flight facility. This makes very good sense because up to now it has been difficult getting to a variety of African countries without taking extraordinarily circuitous routes and/or paying uneconomic sums for the privilege.
But there are flies in the ointment. The first was when Fastjet realised it could get 1time much cheaper if it allowed it to go into liquidation. I mean, why pay creditors when you get the same asset for virtually nothing? Stelios Haji-Ioannou, the founder of easyJet and the hand behind Fastjet, has not become rich by being kind.
The next fly is that South Africa continues to use legislation that has long gone out of fashion elsewhere, but remains convenient if your authorities want to protect state-owned enterprises. The limit on foreign ownership of airlines is 25%, which makes external controlling ownership of 1time very problematic.
Finally, there’s this bleating going on by Mango and Comair, both of which object to the possibility that Fastjet might attempt to use 1time to secure international route rights into and out of South Africa. Frankly, if Fastjet was so clever as to see this opportunity, why didn’t Comair move straight down the same track? I have always thought Comair gets to suck on the hind straw but this complaint belies its own ability to do exactly what Fastjet is trying.
One of the problems is that African countries continue to be jingoistic when it comes to their airspace. An attempt to put this right was made by the Yamoussoukro Declaration, supposedly supported by African states back in 1999. But, as usual with so many of these efforts, a wonderful opportunity to open African skies to genuine competition has been carefully and deliberately avoided.
None of this addresses the real issue: those complaining to the Department of Transport and the licensing council are simply trying to close down any new competition and protect their margins. The fact that one complainant, Mango, is already subsidised by the South African taxpayer seems not to matter a whit.
So where is the Competition Commission in all this? It has investigated SAA previously on issues such as pricing. It must already be equipped with considerable information that would be of great use to any authority needing to examine the pros and cons of what’s going on.
Surely it should be ready to assist the regulator or pursue a result that is in line with sound competition policy and is beneficial to all those wanting to make use of air transport between nations?
Repeated attempts to make contact with it to question its position have met with the stonewall of silence. Trudi Makhaya, the commission’s manager for advocacy and stakeholder relations, doesn’t take calls either to her landline or mobile and doesn’t respond to messages. All this does is underline what I suspect: that the commission is scared to take on government departments. Were it to do anything this time, it would be up against the Department of Public Enterprises, and for some reason it seems reluctant to do so.
WHAT is happening to Trevor Manuel and where is he going?
I ask because the effect he has had on a wide variety of policy developments and their implications since 1994 has been considerable.
He was trade and industry minister when he forced through the decision to drop tariff barriers that had been used to protect South African industry from competition during the apartheid years.
The howls of pain and outrage that induced were so great that many thought he would have to relent. Instead, he went deaf.
Then he was appointed finance minister and, to the shock and horror of many businessmen and economists, asked what this "amorphous" market thing was that everyone seemed so afraid of.
The market taught him that lesson sharply.
Needless to say, and with indefatigable good humour, he became what many could claim was the best finance minister South Africa has seen for the past 50 years.
Then, with a deftness and subtlety that has long characterised him, he became the man to produce a National Development Plan to which the majority could subscribe. It was this plan that was adopted at the African National Congress’s recent Mangaung conference.
Then he went and resigned from the party’s national executive.
And so, what now?
He seems to be enjoying the autumn shadows that sometimes give comfort to those who have stuck to their guiding lights and have done well by the country they have sought to serve.
I don’t know where he’s going or why, but I hope it’s not for long or too far. He has work still to do.
More in this section
- Licensing bill to be redrafted after avalanche of disapproval
- Saxonwold ANC ‘to act against Atul Gupta’
- Gupta brothers are merely a symptom, not the problem
- Burger King fires up its grill in Cape Town
- Health insurance plan, price regulation soon, says minister
- Courts reel in SARS ‘fishing expeditions’ against taxpayers