Aviation: Opposition Party Accuses Government of planning to rescue South African Airways with R6b Pension funds
Rescuing SAA has been a subject of public debate for a while now. While there’s a general agreement that SAA should be rescued from its financial troubles, the best way to go about the mission has not been agreed on. If you ask the Democratic Alliance (DA), the party would contend that the only logical solution to ensure the sustainability of SAA is to file for business rescue and to stabilise the airline before taking it to the market to find private equity investors.
The sentiment is obviously why the party isn’t happy with the Finance Minister’s move to fund SAA with pensioners’ money. According to the party, Malusi Gigaba wants to take R6 billion from pensioners to fund SAA. Agitating against the development, the party insisted that rescuing SAA should be through privatisation. “… The Minister (has) confirmed that there will be no privatisation of South African Airlines and that pensioners’ money is being considered to fund the airline.
SAA’s corporate plan shows that the Public Investment Corporation (PIC) is one of the identified sources under consideration for funding SAA to the tune of R 6bn. This revelation was confirmed by the Finance Minister in Parliament,” stated DA. To DA, the plan is disastrous because the airline is bankrupt and has already recorded a loss of R 1.4 billion for the first three months of the current financial year.
“Considering that privatisation is off the cards, it means that these funds would have to come in the form of a loan or a bailout. This puts millions of pensioners at the risk of losing their hard earned money. “(We are) strongly opposed to the idea of targeting vulnerable pensioners to bailout SAA which continues to make losses with no signs of turning around in sight,” asserted DA. Thereafter, the party vowed it will continue to fight and protect the vulnerable from being dragged into SAA’s mess.