[UPDATE] Bailouts for SOEs to come in chunks - Mboweni
The bailout money for the SABC, Denel and SAA would come from the contingency reserve account but Finance Minister Tito Mboweni said it came with strings attached.
CAPE TOWN - Finance Minister Tito Mboweni said cash injections for state-owned entities like the South African Airways, the South African Broadcasting Corporation (SABC) and Denel wouldn't be handed over all at once but in chunks, as certain conditions are met.
Mboweni was on Tuesday replying to debate on the Appropriations Bill, which was before the National Assembly.
The Appropriations Bill provides for budget allocations to all departments and entities and was tabled by Mboweni along with his February Budget.
It included provision for R3.2 billion for the cash-strapped public broadcaster.
The bailout money for the SABC, Denel and SAA would come from the contingency reserve account but Mboweni said it came with strings attached.
"We would not just make that available tomorrow, it would be a mistake but we will release in chunks as certain conditions precedent are met, to make sure there’s progress in improving the organisation."
Mboweni said chief restructuring officers for each entity would be announced on Wednesday. They would work with the management of the SABC, SAA and Denel to get them back on track.
The minister has warned that the country’s debt to GDP ratio was at an “unacceptable level”: “Thus providing the basis for a serious crisis in the country."
He said financial management needed to be improved across government and people needed to accept the principle of paying for the services they use.