Some 163 vacancies will need to be filled when the new SAA starts, while 195 pilots still need to be retrenched.
This was revealed on Wednesday evening, November 4, when the DPE briefed the Standing Committee on Public Accounts (Scopa) to provide an update on SAA's business rescue plan.
It was also revealed that, of SAA’s 4 647 employees, 3 246 have applied for voluntary severance packages. The business rescue plan requires a headcount of 1 000 employees for the new airline, including 105 in management, 119 specialists, 88 pilots, 412 ground staff and 276 cabin crew.
According to the presentation, 120 staff employed in management have applied for packages and there are 65 remaining employees, leaving a deficit of 40; 149 specialists have taken packages with 42 remaining, leaving a deficit of 77; and 1 731 ground staff have taken packages and 366 remain, leaving a deficit of 46.
The briefing comes after R10,5bn was allocated to SAA in the 2020 medium-term budget policy statement delivered at the end of last month. According to the breakdown provided in the presentation, R2,8bn would be allocated to employees, R800m to creditors, R2bn for working capital to start the new airline, R2,2bn to cover unflown ticket liability and R2,7bn to recapitalise SAA subsidiaries SAA Technical, AirChefs and Mango.
The R10,5bn will be paid out in January next year and SAA’s BRPs need to secure bridging finance in the interim. Louise Brugman, spokesperson for the business rescue practitioners, confirmed that they were in the process of seeking bridging finance, but did not give further details.
According to a report in the Sunday Times, Nedbank, along with four other South African banks, has agreed to provide government-guaranteed post-commencement bridging finance of up to of R3,6bn. The article says that Nedbank has stipulated the bridging finance can only be used for essential expenses such as severance pay and salaries and that funding cannot be used for the costs of any new airline.
DA member of Scopa, Alf Lees, described the briefing as a “complete farce”, saying that there were too many MPs involved in the committee, many of whom have an agenda of protecting Public Enterprises Minister Pravin Gordhan. Alf told Travel News that the department did not answer key questions including why SAA employees were getting preferential treatment for a severance package when the same was not being made available to employees of SA Express or any private companies that were also in trouble; why packages were being paid out to staff whom the airline would have to immediately re-employ; and on what authority bailouts for SAA’s subsidiaries were being approved given that the BRPs had refused to answer questions on the subsidiaries, saying these were not under business rescue and had their own boards.
“Gordhan also refused to give any information about these so-called private equity investors,” said Alf, adding that the department had been talking about these investors since the rescue started, while none have ever materialised.
