Gordhan: SAA too important & strategic to be allowed to fail again
Public Enterprises Minister Pravin Gordhan said that SAA still had a role to play in the country’s economy and allocating it R10.5 billion was a better option than liquidation.
CAPE TOWN - Public Enterprises Minister Pravin Gordhan said that South African Airways (SAA) was far too important and strategic for the economy to be allowed to fail again.
He's backing the multi-billion rand cash injection for the airline to help with its business rescue plan.
The minister and the national carrier's business rescue practitioners briefed the Standing Committee on Public Accounts (Scopa) and Public Enterprises officials on Wednesday night.
Gordhan said that SAA still had a role to play in the country’s economy and allocating it R10.5 billion was a better option than liquidation.
He added that a number of industries would be impacted if the airline was not fixed.
"SAA is undergoing a serious process of change. It is still, at the end of it all, a valuable public asset that needs to go into a new shape, a new direction."
Business rescue practitioner, Siviwe Dongwana, said that the carrier still owed passengers R3 billion in bookings that had not been honoured.
He said that the airline was completely out of cash.
"I think that the important issue is that we must remember that at the moment we have an allocation but we do not have cash. There is no funding that has flown into the company and if the company were to, for argument's sake, get out of business rescue at this point with immediate effect, the reality is that the company will be able to meet its obligations as they fall due today."