PLETTENBERG BAY NEWS - The Plettenberg Bay Residents' and Ratepayers' Association says the R1.8 million Bitou municipality has agreed to pay to rsa.Aero to terminate the Plett Airport agreement "is a fair settlement" for expenses incurred.

Steve Pattinson, chairman of the PBRRA and the airport's Hangar Owners' Association, said the collapse of the agreement between the municipality and rsa.Aero "has unfortunately been an expensive process".

'Right decision'

"Under the circumstances, we are confident that Bitou has made the right decision to terminate this agreement," said Pattinson.

He said once the termination process between Bitou municipality and rsa.Aero is concluded, "talks are expected to start afresh over its (airport's) future".

"Bitou has agreed to sit with the Hangar Owners' Association, potential commercial operators and interested parties to discuss the way forward.

'Fast track runway renovations'

"Specifically to fast track the runway renovations, regain at least the Category 5 status and for the resumption of commercial operations."

Pattinson said the future of the Plettenberg Bay Airport has been uncertain for too many years.

"So there was reason for cautious optimism when Bitou finally decided to outsource the airport business in 2024.

"The process started positively with a comprehensive tender document and a robust set of bids from five operators. The rsa.Aero bid document was the most compelling and the award was made by Bitou." Then the wheels fell off…

'Commercially inadequate'

"The contract that was signed in February 2024 between Bitou ocials and rsa.Aero was, according to legal opinion, commercially inadequate.

"It was a one-sided affair with an absence of specific obligations and responsibilities, and lacking in any performance measures, timelines and consequences for the operator for non-performance," said Pattinson.

'Poor articulation'

"For the next six months, the two parties haggled over who was liable for the necessary runway improvements, a reflection of the contract and the poor articulation of obligations.

"Over this period, the CAA closed down the airport to commercial operations due to the fact that their requirements to address the deterioration in the runway were continually ignored.

'New contract recommended'

"In July, a senior advocate opinion stated that the contract was not aligned to the tender requirements and it was recommended that a new contract and service level agreement be drawn up to give effect to the original intention of the tender."

"Consequently Bitou issued a new contract and Service Level Agreement to rsa.Aero which was rejected. As the dispute could not be resolved, the council voted to terminate the agreement."

A claim of R7m was made by rsa.Aero but Bitou determined that only R1.8m in compensation for expenses incurred was "fair and reasonable".

'Key lessons learnt'

"A number of key lessons have been learnt," said Pattinson.

Among these are:

• The airport is a significant economic asset for both Plettenberg Bay and the Garden Route.
• Bitou, along with the aviation community, should retain and invest in its assets.
• Regional airports, like Plettenberg Bay's, are not profit-generators; rather, the return is through job-creation and longer term economic growth through tourism. Airports also allow residents to work, and have business interests, away from their place of residence and ultimately increase the economic base of the town.
• Leasing over 60ha of airport land to property developers for 30 years (potentially renewable for another 60 years) with no rates and taxes payable was never going to be in the interest of Plettenberg Bay.
• Municipalities generally do not have the commercial capabilities to conclude contracts of this magnitude.
• Regional airports need competent airport managers and trained sta to ensure safe passenger movement, manage fire and rescue services, maintenance and bush-clearing, and for fuel-management.

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