Parliament welcomes decision to turn down further bailout for South African Airways

15 April 2020

The Standing Committee on Public Accounts (Scopa) welcomes the decision by the Minister of Public Enterprises to turn down the request from the South African Airways (SAA) business rescue practitioners for R10 billion in extra funding.

Scopa believes that the decision taken by the Minister is correct as SAA cannot want its cake and eat it. SAA has handicapped oversight, despite the best efforts of the committee to hold the airline accountable, by insisting on only tabling financial statements once the business is a going concern.

This kind of reasoning in itself is irregular as the airline cannot be allowed to sanitise its balance sheet and only submit financials when it is convenient for it to do so.

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.

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.

Issued by Faith Ndenze, Media Officer, Parliamentary Communication Services, 16 April 2020