No changes, no bucks, SAA told

Only when SAA has put in place a new board and appointed a competent CEO and finance chief will the national Treasury consider providing the state-owned airline with the financial backing it needs to become a going concern.

Deputy Finance Minister Mcebisi Jonas said during the budget vote debate in the National Assembly that a strong board and executive team would be given the task of implementing the airline’s turnaround strategy and undertake rationalisation of the government’s three airlines — SAA ‚ SA Express and Mango.

Jonas said the Treasury would not open the purse strings to SAA until this comprehensive package of measures had been implemented.

The airline, which has been placed under the Treasury’s oversight, has been unable to table its financial statements for 2014-2015 in parliament because auditors were worried about its status as a going concern. The statements were due in August last year.

Jonas said SAA — being kept afloat by a R14.4-billion guarantee from the state — needed to reduce its debt significantly.

Finance Minister Pravin Gordhan said he favoured a minority equity partner buying into the struggling national airline at “some stage” to bolster its finances.

Gordhan hit out at the “arrogance and belligerence” of the directors of Treasury will not open purse strings until measures are implemented some state-owned companies — singling out arms manufacturer Denel.

Gordhan said the Treasury had spotted a tendency among boards to do things they were not supposed to do and then to “display a level of arrogance and belligerence that did not befit the right kind of corporate governance”.

“The board at Denel needs to take that message to heart‚” he said.

Gordhan announced that his department was slashing spending on travel‚ advertising and cellphones by government officials.

About R7-billion would be saved by this belt-tightening, which would be escalated in future, leading to savings of R25-billion a year by 2018-2019.

Gordhan said progress had been made on electricity supply, tourism numbers and the way in which a national minimum wage could be implemented.

However, opposition DAMP David Maynier said the finance minister’s austerity measures did not go far enough. The DA is suggesting more than 300 amendments to the 2016-2017 budget‚ adjusting it by R9.5-billion‚ to fund job creation, fight crime, subsidise poor students‚ combat corruption and give relief to the poor.

The party will propose a comprehensive spending review aimed at identifying savings and eliminating wasteful expenditure in all three spheres of government.

— BDlive, TMG Digital