Drivers of efficiency and their influence on airline performances in South Africa: a bootstrapped meta-frontier approach

2019 ◽  
Vol 14 (1) ◽  
pp. 121-135
Author(s):  
Oswald Mhlanga
Keyword(s):  
South Africa ◽  
South African ◽  
Airline Industry ◽  
Policy Implications ◽  
Niche Markets ◽  
African Government ◽  
Content Type ◽  
Political Interference ◽  
Run Up ◽  
The Cost

Purpose This paper aims to identify drivers of efficiency and their influence on airline performances in South Africa. Unfortunately, the methods currently used to measure airline efficiency fail to address the heterogeneity problem, which blurs inefficiency. Design/methodology/approach To remedy the heterogeneity problem, this paper adopts the meta-frontier framework to identify drivers of efficiency. The interesting feature of the model is that it ensures that heterogeneous airlines are compared based on one homogeneous technology. The model is tested using a panel data sample of nine South African airlines, which operated from 2015 to 2018. Findings The paper demonstrates that structural drivers, namely, “aircraft size”, and “airline ownership” and one executional driver, namely, “the cost structure” significantly influence (p < 0.05) airline efficiency thereby corroborating evidence from some prior studies. Research limitations/implications First, because of the small size of the industry, fewer airlines and a lack of detailed data, the study could not consider other important factors such as optimal routing and network structure. Second, a more rigorous analysis over a period of time would yield better understanding about the growth of the industry in South Africa and recognise the variation in the influence of drivers of efficiency on airline performances over time. Practical implications The results have potential policy implications. First, as the market in South Africa is too small to operate with a smaller aircraft probably, for airlines that operate with smaller aircraft to operate efficiently they should first identify niche markets where they can have a route monopoly. Second, while all state-owned airlines are perfect statehood symbols that define and represent countries, most state carriers in South Africa are highly inefficient. The researcher recommends policymakers to privatise state airlines or seek equity partners. Many nationalised airlines have turned losses to profits in the run-up to privatisation. British Airways, once a large burden on the British taxpayer, is now one of the world’s most efficient airlines. After the privatisation of Air France and Iberia, all two turned from loss-making concerns into profitable airlines. It, therefore, makes no sense for the South African government to expect state carriers to pursue a commercial mandate with such political interference. The very notion of efficiency itself is at risk. Originality/value This paper is a first attempt to identify drivers of operational efficiency using a bootstrapped meta-frontier approach in the airline industry in South Africa. By applying the meta-frontier approach the paper ensures that all heterogeneous airlines are assessed based on their distance from a common and identical frontier.

Sustainable housing financing model to reduce South Africa housing deficit

2017 ◽  
Vol 10 (3) ◽  
pp. 410-430 ◽  
Author(s):  
Bashir Olanrewaju Ganiyu ◽  
Julius Ayodeji Fapohunda ◽  
Rainer Haldenwang
Keyword(s):  
South Africa ◽  
South African ◽  
Affordable Housing ◽  
Low Income ◽  
Low Cost ◽  
South African Government ◽  
The South ◽  
African Government ◽  
Content Type ◽  
Mortgage Payment

Purpose This study aims to identify and establish effective housing financing concepts to be adopted by government in achieving its mandate of providing sustainable affordable housing for the poor to decrease the building of shacks, as well as proposing solutions to the housing deficit in South Africa. A rise in demand and shortage in supply of housing calls for the need to address issues of affordable housing in South Africa, and developing countries in general, to ensure a stable and promising future for poor families. Design/methodology/approach Literature has revealed that the South African government, at all levels, accorded high priority to the provision of low-cost housing. Thus, government has adopted subsidy payment as a method of financing affordable housing to ensure that houses are allocated free to the beneficiaries. This also addresses the historically race-based inequalities of the past, but unfortunately, this has not been fully realised. This study uses a sequential mixed method approach, where private housing developers and general building contractors were the research participants. The qualitative data were analysed using a case-by-case analysis, and quantitative data were analysed using a descriptive statistical technique on SPSS. Findings The results of the qualitative analysis reveal a gross abuse of the housing subsidies system by the beneficiaries of government-funded housing in South Africa. This is evident from illegal sale of the houses below market value. This has led to a continual building of shacks and an increased number of people on the housing waiting list instead of a decrease in the housing deficit. The results from quantitative analysis affirm the use of “Mortgage Payment Subsidies, Mortgage Payment Deductions, Down-Payment Grant and Mortgage Interest Deductions” as viable alternatives to subsidy payment currently in use to finance affordable housing projects by the South African Government. Practical implications At the moment, the focus of the South African National Government is continual provision of free housing to the historically disadvantage citizens, but the housing financing method being used encourages unapproved transfer of ownership in the affordable housing sector. This study thus recommends the use of an all-inclusive housing financing method that requires a monetary contribution from the beneficiaries to enable them take control of the process. Originality/value The relational interface model proposed in this study will reduce pressure on government budgetary provision for housing and guarantee quick return of private developers’ investment in housing. Government must, as a matter of urgency, launch a continuous awareness programme to educate the low-income population on the value and the long-term benefits of the housing.

Progressive tax: a proposal for customer loyalty programmes

2019 ◽  
Vol 31 (4) ◽  
pp. 626-645
Author(s):  
Teresa Michelle Pidduck ◽  
Karen Odendaal ◽  
Michelle Kirsten ◽  
Lauren Anne Pleace ◽  
Kaylee De Winnaar
Keyword(s):  
South Africa ◽  
Case Studies ◽  
South African ◽  
Financial Reporting ◽  
Customer Loyalty ◽  
Tax Revenue ◽  
South African Government ◽  
The South ◽  
African Government ◽  
Content Type

Purpose The South African Government needs to increase fiscal revenues to cater to increased government spending. This paper aims to argue that the South African Revenue Service (SARS) has an opportunity to tax the receipt of customer loyalty programme awards in the hands of customers, with little amendment to current tax legislation or administration. This provides the South African Government an opportunity to increase much needed tax revenue in spite of limited resources. Design/methodology/approach Five instrumental case studies were used and analysed from a financial reporting perspective to quantify customer loyalty points earned by customers. These can form a basis for deriving the potential benefits from the taxation of customer loyalty programmes in the retail industry. The multiple instrumental case studies used and the application of accounting guidance in International Financial Reporting Standards allow generalisations to be made to highlight the amount of customer loyalty awards granted and possible tax revenues forgone in just one sector of the South African economy. Findings Should the proposals for taxation of customer loyalty programmes be implemented, the fiscus would be able to collect over R 234.35m (US$16.91m) in tax revenue from only five companies providing customers with loyalty awards. This indicates that this proposal for taxation is critical for investigation by the South African Government, as it may aid in achieving revenue goals for South Africa. Originality/value This paper contributes to the literature on taxation legislation within South Africa by proposing a model that may be used by the SARS to increase tax revenues to meet the Government’s needs.

The airline industry in South Africa: drivers of operational efficiency and impacts

2018 ◽  
Vol 73 (3) ◽  
pp. 389-400 ◽  
Author(s):  
Oswald Mhlanga ◽  
Jacobus Steyn ◽  
John Spencer
Keyword(s):  
South Africa ◽  
Airline Industry ◽  
Operational Efficiency ◽  
Policy Implications ◽  
Load Factor ◽  
Content Type ◽  
Capital Costs ◽  
Block Time ◽  
Structural Drivers ◽  
The Impact

Purpose The airline industry is structurally challenged by its very nature, because of high overhead and capital costs. This is further exacerbated by macro-predictability and micro-uncertainty, thereby making it difficult for airlines in South Africa to attain operational efficiency. The purpose of this study is to identify drivers of operational efficiency and their impacts on airline performances in South Africa. Design/methodology/approach An extensive data collection using primary and secondary sources enabled the researchers to gather data on all the airlines operating in South Africa, for the period of 2012-2016, on a variety of parameters. A two-stage empirical analysis was carried out, which involved estimation of operational efficiencies during the first stage by using data envelopment analysis (DEA) and determination of performance drivers during the second stage by using a two-way random-effects generalised least squares regression and also a Tobit model. Findings From the study, it is clear that two structural drivers, namely, “aircraft size” and “seat load factor”, and two executional drivers, namely, “low cost business model” and “revenue hours per aircraft”, significantly impacted (p < 0.05) positively on airline efficiencies in South Africa. To improve efficiency, management should first concentrate on the drivers that can be changed in the short-term (executional drivers) and later focus on the drivers that require long-term planning (structural drivers). However, among the structural drivers, only “aircraft families” had a negative impact on airline efficiencies, whilst among executional drivers, only “block hours” negatively impacted on airline efficiencies. Research limitations/implications Despite the importance of this study, it is not free of limitations. Firstly, because of the small size of the industry, fewer airlines and lack of detailed data, the study could not consider other important factors such as optimal routing and network structure. Secondly, although non-aeronautical revenues have become increasingly important in airline management, they were not included in this study. Further studies may investigate the impact of these factors on airline efficiency. Practical implications The results have potential policy implications. Firstly, as the domestic airline market in South Africa is too small to operate with a smaller aircraft efficiently, airlines that intend to make use of smaller aircraft should first identify niche markets where they can have a route monopoly, such as SA Airlink. Secondly, as block time negatively affected airline efficiency, airlines can undertake schedule adjustments to reduce block time and thus improve technical efficiency. Originality/value This paper is a first attempt to identify drivers of operational efficiency in the airline industry in South Africa. The results indicate that DEA is a useful tool to identify factors impacting airline efficiency and could improve airline performances in South Africa.

Voluntary and timely disclosure and the cost of debt: South African evidence

2014 ◽  
Vol 22 (2) ◽  
pp. 149-164 ◽  
Author(s):  
Achraf Guidara ◽  
Hichem Khlif ◽  
Anis Jarboui
Keyword(s):  
South African ◽  
Voluntary Disclosure ◽  
Developing Economies ◽  
Policy Implications ◽  
Cost Of Debt ◽  
The South ◽  
Content Type ◽  
Publicly Traded Companies ◽  
The Cost ◽  
African Setting

Purpose – The aim of this study is to investigate the effect of voluntary and timely disclosure on the cost of debt for the South African setting. Design/methodology/approach – The sample of this paper consists of 20 South African listed non-financial companies for the period 2008-2011. A content analysis is used to measure the extent of voluntary disclosure. Timely disclosure is proxied by earnings reporting lag. Findings – Results show that the extent of voluntary disclosure is negatively and significantly associated with the cost of debt. In contrast, timely disclosure exerts a trivial effect on the cost of debt. When testing for the moderating effect of timely disclosure on the association between the extent of voluntary disclosure and the cost of debt, this paper documents that this association is only negative and significant for the shorter earnings announcement lag group. Originality/value – The findings of this paper have policy implications for managers in the South African setting and other developing economies similar to South Africa, given the crucial role played by debt as an important source of external financing for publicly traded companies.

The Engagement of Beneficiaries in Farm Governance of Restituted Land through the Communal Property Association Model: The Ideal Versus the Reality of Beneficiary Farms in South Africa

2019 ◽  
Vol 16 (2) ◽  
Author(s):  
Mokoko Piet Sebola ◽  
Malemela Angelinah Mamabolo
Keyword(s):  
South Africa ◽  
South African ◽  
Land Reform ◽  
Farm Management ◽  
The South ◽  
African Government ◽  
Communal Property ◽  
Farm Ownership ◽  
Land Restitution ◽  
Communal Property Associations

The purpose of this article is to evaluate the engagement of farm beneficiaries in South Africa in the governance of restituted farms through communal property associations. The South African government has already spent millions of rands on land restitution to correct the imbalance of the past with regard to farm ownership by the African communities. Various methods of farm management to benefit the African society have been proposed, however, with little recorded success. This article argues that the South African post-apartheid government was so overwhelmed by political victory in 1994 that they introduced ambitious land reform policies that were based on ideal thinking rather than on a pragmatic approach to the South African situation. We used qualitative research methods to argue that the engagement of farm beneficiaries in farm management and governance through communal property associations is failing dismally. We conclude that a revisit of the communal property associations model is required in order to strengthen the position of beneficiaries and promote access to land by African communities for future benefit.

Exploring the South African Government Communication on Land Expropriation without Compensation

2020 ◽  
Vol 72 (1-3) ◽  
Author(s):  
Lungisani Moyo
Keyword(s):  
South Africa ◽  
Food Security ◽  
South African ◽  
Small Scale ◽  
South African Government ◽  
Eastern Cape ◽  
The South ◽  
Land Expropriation ◽  
African Government ◽  
Government Communication

ABSTRACT This paper used qualitative methodology to explore the South African government communication and land expropriation without compensation and its effects on food security using Alice town located in the Eastern Cape Province South Africa as its case study. This was done to allow the participants to give their perceptions on the role of government communication on land expropriation without compensation and its effects on South African food security. In this paper, a total population of 30 comprising of 26 small scale farmers in rural Alice and 4 employees from the Department of Agriculture (Alice), Eastern Cape, South Africa were interviewed to get their perception and views on government communications and land expropriation without compensation and its effects on South African food security. The findings of this paper revealed that the agricultural sector plays a vital role in the South African economy hence there is a great need to speed up transformation in the sector.

Fire on the Mountain: Reinvigorating Legislative Measures to Quench the Flame of Illicit Drug Use in South Africa

2020 ◽  
Vol 3 (2) ◽  
pp. 15-29
Author(s):  
Sogo Angel Olofinbiyi ◽  
Thembelihle Mtambo
Keyword(s):  
South Africa ◽  
Drug Use ◽  
South African ◽  
Illicit Drugs ◽  
Illicit Drug ◽  
Illicit Drug Use ◽  
Critical Discussion ◽  
African Government ◽  
Clear Cut ◽  
Legislative Measures

South African societies have been characterized by the prolific incidence of illicit drug use in recent times.  The paper attempts to examine the legislations implemented on the use of illicit drugs in South Africa. The study adopts a review of the literature to identify and describe the most common illicit drugs used around South Africa communities, placing emphasis on the policies developed by the South African government in combating these situations. The research follows a critical   discussion on the issues associated with drug use, its causes, as well as its effects on humans and the environment. The study recommends relevant initiatives to combat all intricacies associated with drug use within the country. This approach will be appropriate in facilitating a clear-cut   understanding of the possible remedies to quench the burning flame of illicit drug use across a broad range of South African communities.

A Review of Medical Waste Management in South Africa

2018 ◽  
Vol 10 (1) ◽  
pp. 34-45 ◽  
Author(s):  
Olaniyi FC ◽  
Ogola JS ◽  
Tshitangano TG
Keyword(s):  
South Africa ◽  
Waste Management ◽  
South African ◽  
Management Practice ◽  
National Policy ◽  
Medical Waste ◽  
African Government ◽  
The Past ◽  
Government Documents ◽  
Medical Waste Management

Background:Poor medical waste management has been implicated in an increase in the number of epidemics and waste-related diseases in the past years. South Africa is resource-constrained in the management of medical waste.Objectives:A review of studies regarding medical waste management in South Africa in the past decade was undertaken to explore the practices of medical waste management and the challenges being faced by stakeholders.Method:Published articles, South African government documents, reports of hospital surveys, unpublished theses and dissertations were consulted, analysed and synthesised. The studies employed quantitative, qualitative and mixed research methods and documented comparable results from all provinces.Results:The absence of a national policy to guide the medical waste management practice in the provinces was identified as the principal problem. Poor practices were reported across the country from the point of medical waste generation to disposal, as well as non-enforcement of guidelines in the provinces where they exit. The authorized disposal sites nationally are currently unable to cope with the enormous amount of the medical waste being generated and illegal dumping of the waste in unapproved sites have been reported. The challenges range from lack of adequate facilities for temporary storage of waste to final disposal.Conclusion:These challenges must be addressed and the practices corrected to forestall the adverse effects of poorly managed medical waste on the country. There is a need to develop a medical waste policy to assist in the management of such waste.

scholarly journals Shopping list development and use of advertisements’ pre-store food-buying practices within different socio-economic status areas in South Africa

2017 ◽  
Vol 119 (12) ◽  
pp. 2880-2902
Author(s):  
Rodney Graeme Duffett ◽  
Crystal Foster
Keyword(s):  
South Africa ◽  
South African ◽  
Developing Country ◽  
Economic Status ◽  
Demographic Characteristics ◽  
Low Ses ◽  
Content Type ◽  
Shopping List ◽  
Food Shopping ◽  
Food Buying Practices

Purpose The purpose of this paper is to determine whether there is a difference in the development of shopping lists and use of advertisements as pre-store food-buying practices in terms of planned shopping by South African consumers who dwell in different socio-economic status (SES) areas. The paper also considers the influence of shopper and socio-demographic characteristics on pre-store food-buying practices in a developing country. Design/methodology/approach A self-administered questionnaire was used to survey 1 200 consumers in retail stores in low, middle and high SES areas in South Africa. A generalised linear model was employed for the statistical analysis of pre-store food-buying practices within the SES area groups in a developing country. Findings South African consumers that reside in high SES area displayed the largest of shopping list development, while consumers who dwell in low SES areas showed the highest incidence of advertisement usage. Several shopper and socio-demographic characteristics were also found to have an influence on pre-store food-buying practices in different SES areas in South Africa. Research limitations/implications A qualitative approach would offer a deeper understanding of consumers’ pre-store food shopping predispositions as opposed to the quantitative approach, which was adopted for this study. A longitudinal design would also provide a more extensive representation of pre-store food shopping practices over a longer time frame than cross-sectional research. The survey was conducted on Saturdays, whereas consumers who shop during the week may have different shopping and socio-demographic characteristics. Practical implications Astute food brands, marketers and grocery stores could use the findings of this study to assist with their marketing efforts that they direct at consumers in different SES areas in South Africa and other developing countries. Social implications The findings of this study may assist consumers in developing countries, especially those who reside in low SES areas, with food-buying strategies to reduce food costs, make wiser purchase decisions and reduce shopping. Originality/value No study (to the best of the researchers’ knowledge) has considered shopping list development and use of advertisements’ pre-store food-buying practices in different SES areas in a developing country. Furthermore, there is a dearth of research analysing shopper and socio-demographic characteristics in relation to pre-store food-buying practices among different SES areas in developing and developed countries.

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