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SAA board grilled in Parliament

South African Airways revealed it incurred millions in wasteful and irregular spending.

South African Airways plane. Picture: AFP.

CAPE TOWN - South African Airways (SAA) on Tuesday revealed it incurred millions in wasteful and irregular spending.

But it said it received a clean audit on its finances for 2012.

The airline's new acting CEO, acting chairperson and CFO briefed Parliament's Portfolio Committee on Public Enterprises in Cape Town.

SAA's board spoke frankly to Parliament about the carrier's financial and operational situation.

It revealed that while it received an unqualified audit last year, R128 million was reported as irregular expenditure, while R4 million was incurred due to fruitless spending.

The board told Parliament most of the wasted funds were related to "unavoidable" baggage claims.

SAA's total revenue rose by 6 percent, but its operational costs rocketed by 17 percent, partly due to rising fuel prices.

Some MPs also demanded answers about why acting CEO Vuyisile Kona was suspended, but SAA refused to comment on the matter.

It said officials were still conducting investigations.

The amount of money needed by the board, in order to be sustainable, was also a question that the board failed to answer.

The airline's new acting CEO Nico Bezuidenhout said the figure would be more clear after the board released its long-term turnaround strategy at the end of March.

An Oxford University study has shown that SAA's 2012 contribution to the GDP stands at more than R8 billion.

Last week, Eyewitness News revealed that Kona was allegedly suspended because he went over the heads of his superiors and complained to President Jacob Zuma about the SAA board.

Kona was appointed in October and replaced Siza Mzimela.

She allegedly had a breakdown in the relations with government.

It is understood the board was concerned that Kona negotiated long-term fuel deals, which he was not supposed to do in his acting capacity.