'There's not a lot we can do': Unions await clarity on R2bn for SAA

(iStock)
(iStock)

Unions say they are still none the wiser on what government plans to do to secure R2bn to help aid the business rescue process at embattled airline, SAA.

The flag carrier is facing cash flow problems, which could negatively impact workers, head of trade union Solidarity's research institute Connie Mulder, told Fin24.

SAA was placed under business rescue in December, by order of the president, as it was facing a liquidity crisis. At the time creditors and government had each committed R2bn to the process.

Unions – including Solidarity and the National Union of Metalworkers of South Africa and the South African Transport and Allied Workers Union (Satawu) – met with SAA's business rescue practitioners Les Matuson and Siviwe Dongwana twice this week, on Wednesday and Thursday, where the financial situation at SAA was discussed, according to Mulder.

'There's not a lot we can do'

Mulder understands that government needs to make a decision on releasing the R2bn, which is to be discussed at the ANC's National Executive Committee to be held this weekend. He added that the R2bn is needed to curb "major cashflow issues", which would negatively impact workers.

"There's not a lot we can do, except to wait for government to approve it."

Unions have made proposals to the business rescue practitioners – Solidarity wants former CEO Vuyani Jarana and business rescue practitioner Cloete Murray be involved in the process.

According to Mulder, Matuson has requested to meet with unions early next week, to provide feedback. "He said it would be better to set up a feedback meeting as soon as possible, next week. It seems that from what I can understand, the feedback is of a sensitive nature," Mulder said.

Satawu, which is the majority union at SAA Technical - a subsidiary of SAA which provides maintenance services for planes –  on Thursday issued a statement in which it accused government of never having intended to save the airline as it has still not delivered on its R2bn pledge.

According to the union, SAA may have to suspend flights and delay salaries of the R2bn does not come through in time. "We call on President Ramaphosa to do the right thing and instruct Treasury to deliver on the pledge," the statement read.

Speaking to Fin24 by phone on Friday, deputy secretary general Anele Kiet said there had still been no formal commitment from government to provide the R2bn. 

National Treasury has directed questions related to the funding of SAA to the Department of Public Enterprises. Fin24 is yet to receive comment from the DPE.

Meanwhile, Finance Minister Tito Mboweni told journalists on the sidelines of a pre-WEF breakfast on Thursday, that National Treasury was still "trying to find additional financing for SAA."

“Given the serious financial and operational challenges facing SAA, the department of public enterprise and that of National Treasury are working closely with the management of South African Airways and the business rescue practitioners," he said. 

“The National Treasury has provided financial support to the crisis … and as of yesterday [Wednesday] when I was speaking to the director-general of National Treasury we were still trying to find additional financing for South African Airways. He hasn’t briefed me about what has happened between yesterday and this morning,” said the finance minister.

The medium-term budget policy statement painted a dire picture of the state's finances – with Mboweni saying that the "food cupboards were almost bare". At the time government committed to take on SAA's R9.2bn debt, over the next three years.

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