SAA could receive another R10billion cash injection from govt

Government may give South African Airways (SAA) another bailout to the tune of R10 billion, the Democratic Alliance (DA) has revealed in Parliament.

The claim was made on Wednesday when SAA's leadership appeared before Parliament's Standing Committee on Public Accounts (Scopa) to discuss their irregular expenditure and financial difficulties.

The national carrier only owns nine planes in its 60-strong fleet and currently spend R3,5 billion a year to lease out the remaining jets.

Government in July gave the airline a R2,2 billion cash injection to pay one of its debtors.

According to the DA, the R10 billion bailout could be financed by the sale of government's Telkom shares.

Scopa chair Themba Godi says yesterday's proceedings is only the beginning in tackling the problems facing the airline.

Read: Parliament expresses concern over SAA's enormous debt

What our hearing yesterday helped us to do was to isolate issues that we believe need to be followed up. Once that is done, we will have a much clearer picture and we will be able to pinpoint areas of concern and what needs to be done to correct them.

Themba Godi, Scopa chair

Godi said the committee requested a number of documents to thoroughly investigate the dealings of the airline to see where wrongdoing had occurred.

He added the challenges SAA faced would take time to be resolved.

Despite all the issues SAA faces, including that of leadership, Godi remains hopeful that the situation can improve.

Hope springs eternal. I'm always hopeful, because I believe that problems must be confronted head-on, decisively and firmly. We are going into SAA with the intention to have the problem solved.

Themba Godi, Scopa chair

Transport economist, Dr Joachim Vermooten, says one of the reasons SAA is continuously losing money is because their mandate is too broad.

This, coupled with governments lack of funds to put into the airline, had knock-on effects.

According to Vermooten, when government issues guarantees to SAA, banks end up paying for the losses. This ultimately leads to government replacing the banks, which doesn't solve the problem, Vermooten says.

They are trying to do too much and government doesn't actually have the money to try and fund it.

Dr Joachim Vermooten, Transport economist

Listen to the full interview below:

702 welcomes all comments that are constructive, contribute to discussions in a meaningful manner and take stories forward.

However, we will NOT condone the following:

  • Racism (including offensive comments based on ethnicity and nationality)
  • Sexism
  • Homophobia
  • Religious intolerance
  • Cyber bullying
  • Hate speech
  • Derogatory language
  • Comments inciting violence.

We ask that your comments remain relevant to the articles they appear on and do not include general banter or conversation as this dilutes the effectiveness of the comments section.

We strive to make the 702 community a safe and welcoming space for all.

702 reserves the right to: 1) remove any comments that do not follow the above guidelines; and, 2) ban users who repeatedly infringe the rules.

Should you find any comments upsetting or offensive you can also flag them and we will assess it against our guidelines.

702 is constantly reviewing its comments policy in order to create an environment conducive to constructive conversations.

Read More
Home Affairs DG Mkuseli Apleni to challenge precautionary suspension

Home Affairs DG Mkuseli Apleni to challenge precautionary suspension

Sandile July, the lawyer representing Apleni, details some of the reasons provided for the suspension.

ANC MP defends presence at SARS briefing, apologises

ANC MP defends presence at SARS briefing, apologises

Scopa's s ANC study group whip Mnyamezeli Booi says he is sorry for the impression created by his presence at the briefing.

Parliament expresses concern over SAA's enormous debt

Parliament expresses concern over SAA's enormous debt

EWN Reporter Gaye Davis reports on the interrogation of the irregular, fruitless and wasteful expenditure racked up SAA.

SAA a symbol of how poorly SOEs are managed in SA, says Moneyweb editor

SAA a symbol of how poorly SOEs are managed in SA, says Moneyweb editor

South African Airways (SAA) is apparently losing as much as R370 million a month, Moneyweb editor Ryk van Niekerk explains.

Malusi Gigaba rules out privatisation of SAA

Malusi Gigaba rules out privatisation of SAA

Finance minister, Malusi Gigaba, appeared before Parliament's finance committee on Friday morning.

Fundamental problem with SAA is how it has been lead - Gigaba

Fundamental problem with SAA is how it has been lead - Gigaba

On Thursday, National Treasury confirmed that new SAA CEO is Vodacom group executive Vuyani Jarana.

Popular articles
Opinion:  Bishop Lekganyane is right

Opinion: Bishop Lekganyane is right

Stephen Grootes weighs in on comments made by the Zion Christian Church Bishop at the weekend.

So what exactly is radical economic transformation?

So what exactly is radical economic transformation?

Wits associate professor of economics Christopher Malikane speaks to Azania Mosaka about the term that is being bandied about.

Gospel singer Sipho Makhabane explains how Sfiso Ncwane died

Gospel singer Sipho Makhabane explains how Sfiso Ncwane died

Makhabane says Ncwane was feeling weak yesterday and his wife phoned paramedics to check on him.

Who is Advocate Tembeka Ngcukaitobi?

Who is Advocate Tembeka Ngcukaitobi?

The EFF lawyer stole the show during the state capture report court battle.

'Collect experiences, NOT possessions!' - Paul Theron (Vestact MD)

'Collect experiences, NOT possessions!' - Paul Theron (Vestact MD)

Bruce Whitfield interviews the razor-sharp tongued Vestact MD Paul Theron about his money hopes, fears, successes, failures, etc.

3 easy questions could bag you R2000!

3 easy questions could bag you R2000!

WIN R2000! But only if you can prove you're a whiz of the MTN Biz Quiz by answering the following three questions...

Blesserfinder: Matching you with a sugar daddy near you

Blesserfinder: Matching you with a sugar daddy near you

Is social trend Blesserfinder, where girls are allegedly matching up with rich 'benefactors' in exchange for sex, a real thing?