Charles Molele
The EFF has accused the Minister of Public Enterprises Pravin Gordhan of ‘deliberately’ collapsing the embattled South African Airways.
The party said on Wednesday that Gordhan’s rejection of requests made by business rescue practitioners for the SAA was meant to see the national carrier collapse and subject more than 1 000 workers to poverty.
“The EFF condemns the deliberate collapse of SAA by the Minister of Public Enterprises Pravin Gordhan. Gordhan has done this by creating an environment of fiscal uncertainty and arrogantly dismissing advisory provided by appointed business rescue practitioners,” the party said in a statement on Wednesday.
The EFF said the cash being requested was not a bailout, but was part of funds promised by government to help fund SAA during the rescue process.
“Although the global Covid-19 pandemic has stretched the finances of the government thin, these are funds that should have long been allocated but have not due to Gordhan’s determination to collapse SAA and subject its employees to poverty,” said the EFF.
“It is therefore clear that Gordhan has no intention of rescuing SAA or protecting the incomes of its employees. He has no appreciation for the need for a domestic airline owned by the state.”
“This is dangerous if one considers that if it was not for SAA, we would not as a nation be able to repatriate citizens stranded in foreign countries in the midst of the Covid-19 pandemic.”
SAA was placed under business rescue on 5 December 2019, in an attempt to save the entity, and purportedly relieve the state of the burden it poses on the fiscus.
Earlier in April, the airline made a request to the Department of Public Enterprises for an additional R10 billion to avert its total collapse.
In a letter dated 10 April, the airline said it wanted to increase its foreign currency borrowing limit.
However, the Department of Public Enterprises rejected this request.
“Government will not support the extension of the foreign currency borrowing limit to permit foreign financing of the business rescue plan, nor for a care and maintenance budget as you have proposed,” said the DPE.
Meanwhile, the Standing Committee on Public Accounts chairperson Mkhuleko Hlengwa has welcomed the decision by Gordhan to turn down the R10 billion request from SAA.
Hlengwa said the decision taken by “the minister is correct as SAA cannot want its cake and eat it”.
“SCOPA believes that SAA cannot keep on requesting bailouts from the government while refusing to table financials on how these bailouts are being used. This poses a challenge in terms of oversight over the public purse and runs a risk of creating a negative precedent for the state,” said Hlengwa.
“Questions still remain unanswered with regard to the R3.5 billion loan from the Development Bank of Southern Africa (DBSA) that was given to SAA in January this year.”
“This loan was granted in the absence of clear information on the financial situation of the airline. Scopa has held numerous meetings with both SAA and the Minister on this matter and believes that the airline has reached the end of its rope. It is unfortunate that the real casualties of this situation will be the workers of the airline who are forced by this situation to be unemployed.”
