The content on this page is not written by Polity.org.za, but is supplied by third parties. This content does not constitute news reporting by Polity.org.za.

The Democratic Alliance (DA) welcomes the move towards privatisation by South African Airlines (SAA) by means of selling off minority interest in some of its subsidiaries. The DA cannot agree more that such a move will help grow and improve efficiency at these entities.

SAA reportedly plans to sell off its technical division and Voyager - with the possibility of also selling off Air Chefs and the air freight division in the next round.

This decision is significant, especially in light of the fact that it follows hot on the heels of tentative steps taken by Eskom to sell off R 40 billion worth of shares in the new Kusile power station. The implication is clear - the ANC government is privatising on the sly - a tacit admission that their so-called developmental state is completely unworkable, and that private participation is needed.

The DA has long been calling for and welcomes this move towards privatisation as it will translate to enormous efficiency gains in service delivery with the level of competition in the market being stepped up. It will also help to unbundle parastatals in order to relieve any taxpayer liability with the state having to bail them out every time.

Notably, in response to a parliamentary question posed by the DA, and with additional information released subsequent to the reply, we know that parastatals have received about R 245-billion in financial assistance over the past four years. If serious consideration is paid to partial or full privatisation of some of these entities, enormous volumes of state funds can be saved, and diverted towards the proper delivery of services and infrastructure.

Parastatals have been left with little choice but to make an important decision in the best interest of service delivery, rather than to satisfy the ANC's ideological position on government intervention in its ‘developmental state'. The outcome is that we are now looking at private involvement in energy generation and aviation support services - precisely what is needed to inject private capital, and the greater efficiencies and job creation that go along with that.