The Democratic Alliance (DA) is not at all shocked to note reports that South African Airways (SAA) has run out of cash and as a dire, but foreseeable consequence, had to cancel as many as 19 domestic and international flights. We will now write to the business rescue practitioners, Les Matuson and Siviwe Dongwana, urging them to play open cards with South Africans and admit that SAA can not be turned around. They must urgently apply to the courts for SAA to be liquidated.
SAA is bankrupt and has been for a very long time. It is in debt to the extent of some R20 billion. It has no cash reserves, it is unable to meet its current liabilities (including salaries) and still requires more bailouts funded by taxpayers. National Treasury is simply not able to keep the failed public enterprise afloat and the current cash crisis was always inevitable.
This is not simply a result of unfortunate circumstances or bad luck. It is as a result of a frankly incompetent and corrupt ANC government that has grossly and irresponsibly mismanaged billions in taxpayer money, and it is inconceivable that to date nobody has been held accountable for this.
It is now up to Matuson and Dongwana to do the right thing by being honest with South Africans: without further massive taxpayer-funded cash bailouts, SAA cannot continue to trade. The R5.5 billion appropriated in the Adjustments Appropriation Bill that was signed into law on the 13th of January 2020 by President Cyril Ramaphosa is specifically set aside for “South African Airways SOC Ltd: Debt Obligations” and may not be used for continued working capital for SAA. Any attempt by SAA business rescue practitioners to use these funds to keep SAA in business will undoubtedly be illegal.
Matuson and Dongwana must ensure that SAA is put into liquidation without further delay, by applying to Court in terms of section 141 (2)(a)(ii) of the Companies Act No. 71 of 2008, for an order to discontinue the business rescue proceedings and to place the company into liquidation.