‘It was the better option’ — Pravin Gordhan defends decision to privatise struggling SAA
Public enterprises minister Pravin Gordhan has defended the decision to privatise embattled SAA, saying there were several contributing factors to the decision including that it was dormant during the Covid-19 pandemic.
In February, government announced it had concluded the sale of a 51% interest to private consortium Takatso without disclosing the price.
Speaking on Cape Talk, Gordhan defended the decision to privatise the struggling national carrier, saying the decision was the better option.
“You have an asset, which you could have disposed of, and there would have been a sale of some buildings and so on. All 4,000 odd staff would have lost their jobs and would have walked away with something like R28,000. The alternative was much better for the staff and the airline that we can make it work,” Gordhan said.
Previously, he described SAA as a fiscal drain costing government more than R49bn in bailouts since 2006 and failing to make a profit since 2011.
“Despite its rich history, SAA has struggled financially over the past decade because of gross mismanagement, corruption, state capture and abuse of SAA resources.
“This caused persistent financial losses, internal controls were decimated, there was a breakdown of consumer trust and confidence, and ultimately a loss in market share,” he said.
Addressing the media on Monday, EFF leader Julius Malema threatened to take legal action against government over the sale.
He said the sale of SAA was part of a plan by government to privatise all state-owned enterprises.
“We condemn and oppose the disposal of SAA because it is not justifiable and is corrupt. There is absolutely no rationality in selling off an airline to people who are linked to and controlled by the white capitalist establishment.
“We will do everything in our power to reverse the sale because it is evident all state-owned companies will first be made to not function well and thereafter given for free to the white capitalist establishment,” said Malema.
He alleged the sale was an indication South Africans were being taken for a ride and undermined, while their living conditions were not improving, citing the rise of unemployment and poverty.
“In the middle of job losses and rising poverty levels, the prices of all necessities are rising and this includes the prices of fuel. Rising fuel and food prices worsen the living conditions of our people and government has no willingness and capacity to combat rising prices,” he said.
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