Government still 'engaging' on R2bn needed to keep SAA afloat

The Department of Public Enterprises says talks are underway with National Treasury to raise the R2 billion funding needed for SAA - in line with the post-commencement finance (PCF) undertaking government committed to when the national airline was placed in business rescue. 

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In a statement, the Department says talks also continue with the business rescue practitioners in order to minimise any job losses at the struggling national airline.

SAA is urgently needing the funds in order to continue operations.

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In the statement, the Department says "an orderly and methodical restructuring process at SAA" is one of government’s top priorities as it introduced the restructuring.

SAA lenders provided R2 billion as post-commencement finance to enable SAA to continue to operate, while the Government, through National Treasury, committed an equal amount.

"The Government continues to work with the business rescue practitioners, with the primary goal of bringing out of this process a restructured, modern airline that is able to bring million more tourists and be a beacon of both business innovation and efficiency," said the Department. 

"We are determined to break with the past patterns of bailouts as these have become a moral hazard," it added. 

The Department said it met with the business rescue practitioners over the weekend and "is engaging with the National Treasury to raise funds for the airline in line with the PCF undertaking."

"We are determined to contribute to the Business Rescue process so that we could minimise job losses and give birth to a rejuvenated SAA that all South Africans could be proud of," read the statement.