• October 22nd, 2020

Transport commission clips Air Namibia’s wings…. citing safety and financial concerns

The Transportation Commission of Namibia has suspended Air Namibia’s Scheduled Air Services Licence with effect from 23h59 yesterday (Wednesday 8 July 2020). The commission has afforded the national airline an opportunity until Wednesday, 22 July 2020, to provide evidence of having obtained funding to meet the requirements of the Air Services Act as well as a full report regarding the findings of a damning Lufthansa audit report that questioned the safety, operations, management and finances of the airline.
At the feedback session later this month, the commission will consider lifting the suspension, failing which Air Namibia’s licence will be cancelled from that date. 

In official correspondence to Air Namibia, the Transportation Commission in the Ministry of Works and Transport noted that in November 2019, it resolved to suspend Air Namibia’s Air Services Licences based on concern about the airline’s financial situation. 
The letter stipulated that Air Namibia’s Non-Scheduled Air Services Licence would remain valid for the duration of the state of emergency in order to allow for humanitarian evacuation/repatriation flights. However, after the state of emergency, the same suspension and cancellation conditions will apply to the airline’s Non-Scheduled licence.

“Before the suspension came into effect, the Ministry of Finance authorised the airline to raise a loan of N$578 million from a commercial bank(s) against a government guarantee. The proceeds of this loan were seemingly to pay your creditors and to release some of your aircraft from maintenance. As a consequence of the government intervention, the suspension of your ASLs was lifted conditionally,” read the letter from the commission. 

The correspondence, addressed to Air Namibia’s acting managing director Elia Erastus, and copied to the airline’s chairman Escher Luanda, noted that the commission had, apart from its concern about Air Namibia’s financial situation, also became aware of a failed IATA Operational Safety Audit (IOSA) and therefore addressed the matter with the airline’s top brass. The commission stated that it was assured shortcomings highlighted in the IOSA had been remedied.

The letter emphasised that in May 2020, the commission invited Air Namibia to attend a meeting to discuss the matter. “In spite of having been informed during the meeting that Air Namibia would present the commission with a comprehensive report about the Lufthansa audit, none has been forthcoming to date. At the same meeting, Air Namibia also undertook to submit an internal investigation report to the commission within a week of the meeting, to date this has not happened,” the commission noted. 
Apparently, Air Namibia undertook to report back to the commission by 10 June 2020, regarding the future of the airline but this undertaking was not honoured either. 

In the latest national budget, an amount of N$983 million was availed to the airline but the commission is concerned that this is scarcely 12% of what is needed to rescue the ailing airline. This paltry budgetary allocation is less significant when considering that N$600 million of this amount would be taken up for payment of existing aircraft leases and the balance hardly covers the liability for operational revenue, meaning there is no availability of funds to pay other public enterprises or ordinary creditors.
All efforts were futile in obtaining a comment from Air Namibia at the time of going to press. – ebrandt@nepc.com.na

Edgar Brandt
2020-07-09 09:38:24 | 3 months ago

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