Gordhan withholds SAA bailout

Finance minister Pravin Gordhan signalled his tough stance on bailing out under-performing state-owned enterprises.

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Johannesburg -

Finance minister Pravin Gordhan is holding out on the R5 billion guarantee to SAA, signalling his tough stance on bailing out under-performing state-owned enterprises (SOEs).

This followed SAA’s failure to submit its audited financial statements in Parliament at the end of last month, following a promise by Gordhan to Speaker Baleka Mbete this would be done.

National Treasury had not responded to enquiries on the SAA matter by yesterday.

This is the eighth straight month SAA has not submitted its audited financial statements to Parliament.

Last month Gordhan confirmed to the speaker the audited financial statements of SAA would be before the national legislature by the end of the month.

SAA has not been able to table the annual report with its financial statements because it needs a R5bn guarantee from Gordhan to continue to operate as a going concern. The guarantee would also allow the national carrier to raise money from capital markets.

SAA had already received R14bn in guarantees from the Treasury.

The R5bn bailout was sought by SAA from the standing committee on finance in Parliament last year.

Gordhan has made a decision to not easily give bailouts.

He said in his Budget in February the government had spent R467bn on bailouts to SOEs in the past few years and that this could not continue.

Sunday Argus