EFF calls sabotage after SAA denied R10 billion in funding

The Economic Freedom Fighters (EFF) have condemned the “deliberate” collapse of South African Airways (SAA) by the Minister of Public Enterprises Pravin Gordhan. 

“Gordhan has done this by creating an environment of fiscal uncertainty and arrogantly dismissing advisory measures provided by appointed Business Rescue Practitioners (BRPs),” it said in a statement on Wednesday 15 April. 

This comes after the Department of Public Enterprises denied SAA and its BRPs a sum of R10 billion on Tuesday. 

Disingenuous to label SAA’s R10bn as a ‘bailout’

SAA was placed under business rescue on 5 December 2019, in an attempt to save the entity and supposedly relieve the state of the burden it poses on the fiscus. 

“After having committed R4 billion to SAA to assist in its business rescue process, only R2 billion was availed to SAA, with R3.5 billion being loaned from the Developmental Bank of Southern Africa. All of this funding was intended to support the entity through February 2020 until such a point where the government had resolved on its preferred restructuring option,” said the EFF. 

“Due to the unnecessary lack of oversight by the ministry of finance and general incoherence in governance, the Budget Speech which was supposed to allocate a budget to effect measures advised by BRPs for SAA, was silent. Instead, the budget availed R16.4 billion to repay legacy debt accrued by SAA as a result of poor management and inconsistency of fund allocation by government,” it added. 

The EFF said it is, therefore, disingenuous to label the R10 billion requested by SAA as a bailout, as it is the funds that are required to put in place the very measures that the government has agreed upon to rescue the entity and secure jobs. 

“These are funds that should have long been allocated but have not due to Gordhan’s determination to collapse SAA and subject its employees to abject poverty,” it said. 

Gordhan allegedly denies funding for government’s own rescue plan

The EFF went on to say that Gordhan’s response to those who have been charged with rescuing Eskom is filled with arrogance and a lack of regard to how his dismissive nature affects the lives of ordinary people. 

“Gordhan has unilaterally denied SAA support for the extension of foreign currency borrowing limits needed for maintenance, he has denied SAA funding to execute government’s very own rescue plan and denied SAA lending guarantees with respect to the rescue response,” it said. 

“It is therefore clear that Gordhan has no intention of rescuing SAA or protecting the incomes and livelihoods of its employees. He has no appreciation for the need for a domestic airline owned by the state,” it added. 

The red party said it is important to note that if it wasn’t for SAA, we would not have been able to repatriate citizens stranded in foreign countries due to the global pandemic. 

“The EFF reiterates its call for multi-ministerial oversight of State-Owned Enterprises to prevent the inevitable arrogance of Gordhan from collapsing them. To term, SAA’s requests for financial certainty, which are in line with what government has expected of them as bailouts further the narrative of the entity as a burden, while in reality it is being deliberately sabotaged,” it added.