The Organisation Undoing Tax Abuse (Outa) has lambasted a government decision to spend R2.7 billion originally earmarked for the business rescue of SAA, which will now be used to purchase equity in its subsidiaries.
Outa wants to stop the Government from recapitalising Mango and fellow subsidiaries SAA Technical and Air Chefs by diverting the R2.7 billion.
Chief legal officer at Outa Advocate, Stefanie Fick, says they want the money to be withheld from the subsidiaries until all submissions have been heard, considered, and decided on in Parliament.
“The financial situation of Mango and SAAT has never been part of the business rescue proceedings in principle l don’t think so. We have to look carefully at whether the subsidiaries need a bailout but can they use the money that was allocated in terms of the rescue plan. We are saying no, you can’t do that. All we are saying is that one has to look as taxpayers where do we spend our money and is it necessary that we spend our money on non-essential state entities. Maybe the government should let go of these entities to be driven by privately owned businesses.”
SAA entered into business rescue in December 2019 following years of mismanagement of funds and looting, which ultimately left the airline unable to pay its debts.
Discussion with SAA’s interim CEO on his strategy post-business rescue: