The Organisation Undoing Tax Abuse (Outa) has called for a national boycott of South African Airways (SAA) following the announcement by Finance Minister, Tito Mboweni, that the airline will receive a further R10.5 billion bailout from the government in addition to the R16.4 billion it received over the past three years.
The money is to help with the restructuring plan by the Business Rescue Practitioners.
Outa CEO Wayne Duvenage says the plan is unworkable and SAA will remain in a dire state, constantly requiring bailouts from the taxpayer.
“The business rescue practitioners based that request of R10.5 billion some months ago. Since then it has forecasted the airline and aviation industry in Africa to be far worse off. On top of that, we see international airlines making partnerships and deals into the local and regional markets. These are also gonna dampen SAA’s ability to survive. So, now it’s time to turn on consumer-power, people-power and that is a boycott against SAA and it’s gonna be a very structured one.”
Mid-Term Budget | Outa’s Wayne Duvenage reacts to the budget:
The Democratic Alliance (DA) has reacted with dismay to the Medium Term Budget Policy Statement tabled by Finance Minister Tito Mboweni saying it lacked the initiative to move the country forward to the detriment of ordinary South Africans.
Amongst the measures announced by the Minister was that South African Airways (SAA) would be granted a further R10.5 billion bailout and that government aims to stabilise the ratio of debt-to-Gross Domestic Product at around 95% within the next five years.
DA Shadow Minister of Finance Geordin Hill-Lewis explains what he says are the repercussions of these announcements.
“The bailout of SAA is a critical failure the minister has made. This is a matter of principle. He has been warning the country and promising that there would be no further bailouts and he has retreated on that. He has abandoned that commitment and there will be another R10.5 billion on top of the R16.5 billion they got in February. The second retreat that the minister made today; we won’t stabilise debt by 2023, actually, it will only be by 2025/6 and it will be another trillion rands with a T in debt. We are going to be cutting into things like police, healthcare, higher education. All of those things are being cut in today’s budget.”
The United Democratic Party is also not pleased with the SAA bailout.
“Well, the government priorities are upside down, if you look at it. You have a government that calls on civil servants, public representatives to make sacrifices, to take a pay cut in the next few years, which is fine and we are prepared to enter that discussion. But the very same government, decides to give more than R10 billion to SAA as a bailout package. It is a lot like a provider of a family who decides to buy a Christmas tree when the family does not have bread and butter on the table,” says UDM MP, Nqabayomzi Kwankwa.
Minister Tito Mboweni delivers the Medium-Term Budget: