Ramaphosa disagrees with SAA business rescuers

South Africa’s President, Cyril Ramaphosa has questioned the directive of South African Airways (SAA) business practitioners to cancel 11 local, regional and international flights.

Ramaphosa spoke on his way to Addis Ababa to attend a meeting of the African Union.

“Government is not in agreement with the BRPs about the decision to cancel certain flights. We as government are saying we need to sit down with the BRPs and discuss the matter,” Ramaphosa said.

The practitioners made the announcement on Thursday, explaining it as a cost-saving mechanism.

From the end of February 2020, all domestic routes excluding Cape Town and Johannesburg will be cancelled indefinitely. The airways will operate only five routes internationally. This decision has been met with fury by labour unions, who say their input was not sought ahead of the decision.  

Ramaphosa said the government did not agree with this decision and wished to be furnished with the rationale behind the action. He added that “…we want to have a discussion with them because SAA is not only a great symbol for the country but it’s also an economic enabler.”

The president said Public Enterprises Minister Pravin Gordhan would make a statement on the recent developments at SAA.

The department of Public enterprise said on Friday, it will be making representation to the business rescue practitioners in order to balance the need for cutting down unprofitable routes with the necessity to ensure market certainty.

This is the third cancellation of flights since being placed in business rescue and comes after the stakeholders told the airline’s workers that they planned to reduce the workforce.  

SAA went into voluntary business rescue in December after several years of heavy losses that necessitated perpetual bailouts from the state. It recently received a R3.5billion loan from the Development Bank of Southern Africa to remain afloat. The business rescue team led by  Les Matuson is set to reorganise the company into a sustainable business.

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