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The Democratic Alliance (DA) welcomes the decision taken by National Treasury to stop any further bailouts to SAA and the recommendation that the airline be closed down. 

In a presentation before the Standing Committee on Finance and the Select Committee on Finance, Treasury recommended that SAA should be closed and that: 

“no further action required in terms of bailouts except settle guaranteed debt as entity is insolvent and BRPs have not released turnaround plans” 

This clarity of thought is in complete contrast to the stance taken by the Department of Public Enterprises which continues to mislead the public that funds for the SAA Business Rescue Plan, proposed by the Business Rescue Practitioners (BRPs), have been budgeted for. 

The proposed SAA Business Rescue Plan, requiring total funding of R33 billion over the next three years, projects operational losses of R6.4 billion over those three years with a return to profit in the fourth year. However, the plan offers no guarantee and indeed no likelihood that the operational losses will be as projected and will miraculously change to profits in the fourth year. 

 It is inevitable that, unless SAA is privately owned and managed, it will continue to be a source of ANC cadre deployment, maladministration and corruption. 

In view of the rational position taken by Treasury to shut down SAA, it is now clear that Minister Gordhan’s insistence that the airline be retained is nothing more than a political crusade designed to appease the ANC’s disastrous statist policies. 

Minister Gordhan should abandon his SAA crusade and accept the reality that South Africa cannot afford a state airline, especially in the current fiscal crisis that the country finds itself in.

Issued by The DA