Business rescue process ‘only realistic pathway’ for SAA, says Gordhan

The meeting to vote on the future of SAA is set to take place on Tuesday, some seven months after the flag carrier entered administration.

The department's spokesperson Sam Mkokeli says the vote will accept or reject the amended business rescue plan.

"Following the adjournment of the creditors meeting two weeks ago, the business rescue practitioners have revised the business rescue plan. By approving the business rescue plan, creditors and employees will become the co-creators of a new national airline at a time when the devastating consequences of the Covid-19 are causing thousands of job losses in the global aviation industry.”

He warns that the liquidation of SAA will have dire consequences for workers and creditors.

"Creditors would receive substantially less for debts owed to them by SAA. There would be a loss of opportunities to provide the new airline with technical, financial, and operational expertise and overall future business partnerships and the severance benefits to retrenched employees would be capped across the board, regardless of years of service."

All employees will also only receive only a capped severance settlement of R32 000 if the airline is liquidated.

"On the other hand, a restructuring process would offer severance and retirement packages based on years of service, the opportunity to re-employ skills for displaced employees in the future and opportunities to start their own businesses as service providers for a new airline," says Mkokeli.