Mixed signals on fate of SAA funding
There's confusion about the government's commitment to SAA's business rescue plan after Treasury indicated to parliament that no additional funding would be made available for the embattled airline.
The rescue plan needs at least a R12.2bn bailout from state coffers which would fund the airline's debt and severance packages for more than 3,000 staff who would be retrenched.
However, barely a week after cabinet indicated that it supported SAA's business rescue plan which will see the airline making way for a smaller and profitable airline from next year, Treasury threw a spanner in the works in parliament on Friday.
For the SAA business plan to work, the department of public enterprises has already made a commitment to fund the voluntary severance package which would cost R2.2bn.
However, in a written presentation made to parliament's finance committee, Treasury created mixed signals on the future of SAA as it indicated that there will be no more bailouts for SAA and that it should shut shop.
When Treasury was asked yesterday about details of its presentation and implications thereof on SAA's rescue plan, it declined to comment.
Public enterprises minister Pravin Gordhan's spokesperson Sam Mkokeli declined to comment and referred Sowetan to treasury.
The developments have seen the National Union of Metalworkers of SA and the SA Cabin Crew Association announcing yesterday that they will be heading to court as they felt that there were "sinister" plans at play aimed at seeing SAA liquidated.
Numsa spokesperson Phakamile Hlubi-Majola said it was with "absolute shock and dismay" that they learnt of the views of National Treasury and finance minister Tito Mboweni on SAA's future and they had already consulted their lawyers on the matter.
"The purpose [of Mboweni and Treasury's views] ... is intended to undermine any progress to turn around SAA. The goal is to influence the creditors into voting for liquidation on the 14th of July at the upcoming creditors' meeting."
Hlubi-Majola said Numsa and its partner Sacca are calling on President Cyril Ramaphosa "to immediately intervene and fire Mboweni for his recklessness".
"To the extent that these statements have compromised the independence and credibility of the imminent vote on South African Airways' business rescue plan, Numsa and Sacca are in the process of taking legal advice as to the best course of action and all our rights remain reserved."
National Transport Movement president Mashudu Raphetha said it hoped the government would still provide funding.
"Government has already made a commitment to support the business rescue plan. The presentation by Treasury, which I have seen, is worrisome but we are confident that government will fund the business rescue plan .
"We are not moved by the speculations that SAA is to be closed because we know that the fate of the national carrier lies in the hands of the creditors; to this end we urge creditors to adopt the plan in order to salvage the situation. There will be no winner if liquidation is to be realised."
Would you like to comment on this article or view other readers' comments? Register (it’s quick and free) or sign in now.
Please read our Comment Policy before commenting.