Gigaba asked not to use government pension fund to bail out SAA

23 October 2017 - 13:10 By Aphiwe Deklerk
Barring further reshuffles, Finance Minister Malusi Gigaba delivers his first medium-term budget policy statement on Wednesday amid political turmoil and a R40-billion revenue shortfall.
Barring further reshuffles, Finance Minister Malusi Gigaba delivers his first medium-term budget policy statement on Wednesday amid political turmoil and a R40-billion revenue shortfall.
Image: GETTY IMAGES

The DA-run Western Cape government has voiced its opposition to the use of public sector workers' pension funds to bail out South African Airways.

Finance MEC Ivan Meyer said he had written to Finance Minister Malusi Gigaba to register his opposition to such plans.

"I cannot support any decision that puts the pensions of public sector workers at risk‚" said Meyer.

He said he had previously spoke against the proposal at the budget council of last month.

"We cannot allow any decisions that undermine our constitutional obligation to ensure the efficient‚ effective and economical use of state resources. The Government Employees Pension Fund cannot be put at risk‚" he said in a statement on Monday.

His statement comes amid reports about Gigaba's intent to use Public Investment Corporation funds to bail out the troubled national airline.

"If allowed to go ahead‚ this could compromise the returns on the PIC fund‚ and jeopardise the GEPF's ability to meet its obligations. Hence‚ as MEC of Finance of the Western Cape‚ I am strongly opposed to allowing the use of GEPF/PIC funds to bailout SAA‚" added Meyer.

Meyer said the airline was posting a comprehensive loss of R9.7 billion in the current financial year.

"Over the past decade‚ National Treasury has made several transfers of funds to SAA to assist with its recurring financial difficulties. It is clear that SAA (and many other public entities) have become a drain on the fiscus and a further bailout or support has become untenable‚" Meyer said.

He said the recent appointment of a new board‚ which saw the exit of current chairperson Dudu Myeni‚ was cold comfort for the millions of current and future retired civil servants who rely on the GEPF to retire with dignity.

"The GEPF will be placed at risk if the SAA is given access to funds managed by the PIC. Any attempts by the National Government to do so must therefore be resisted‚" he added.


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