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News24 Wire reports that according to Public Enterprises Minister Pravin Gordhan, avoiding the liquidation of SA Airways (SAA) would ensure the aviation market remained competitive and it meant consumers would not be forced to be price takers.
The minister was speaking to MPs on Wednesday. At the meeting, SAA's business rescue practitioners (BRPs) gave an update on the rescue process. SAA was placed in business rescue in December 2019. Gordhan stressed that there would be "no winners" if the airline were to be liquidated. He explained that a restructure would be much better – not only for creditors and employees, but for consumers as well. Last week, Finance Minister Tito Mboweni announced that SAA would receive R10.5-billion from the government to support its business rescue process. Providing a breakdown of the R10.5-billion, BRP Siviwe Dongwana explained R2.8-billion would go toward employee related payments. These included severance packages, retrenchment packages and amounts owing to employees as a consequence of the airline not being able to pay salaries for a number of months. The severance packages will cost R2.2-billion. Of SAA's 4,647 employees, 3,246 have opted for voluntary severance packages. A total of 1,313 employees remain, but the new airline will only need 1,000 employees. The 1,313 employees would have an opportunity to apply for posts at the restructured airline and the remaining employees would then be subject to a retrenchment process.
- Read the full original of the report in the above regard at Engineering News
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