South African Airways board member Martin Kingston says unless the national carrier is able to secure a government guarantee, the board would have to recommend that the airline be placed under liquidation.
Kingston says the national carrier needs R2 billion – and a portion of this money before the end of the month to also pay worker’s salaries.
Talks between SAA and workers unions collapsed Tuesday night. They downed tools last week Friday.
NUMSA says the national carrier could not agree to the worker’s revised salary demand of 6.5% as management says it cannot afford no more than 5.9%. The workers initially demanded an 8% salary increase.
Kingston says banks will not advance SAA any further credit without them being supported by a sovereign guarantee.
“We think that in the next month it will become apparent that we can trade out of the current situation or whether there needs to be a responsible liquidation of the airline.”
He adds: “There’s no money in the bank account to pay anybody. Not the 5.9% today not another cost down the road. Unless and until such time we secure the funding, we are not in a position to make any commitments to anybody.”
“I believe the unions and all stakeholders need to recognise that. All they are doing is accelerating the demise of SAA and I would characterise that as extremely reckless and irresponsible and that’s their prerogative,” adds Kingston.