DA welcomes Mboweni’s commitment, under oath, not to use his “emergency” powers to bail out SAA 

Issued by Geordin Hill-Lewis MP – DA Shadow Minister of Finance
21 Jul 2020 in News

Please find an attached soundbite from Geordin Hill-Lewis MP, DA Shadow Minister of Finance

The Democratic Alliance (DA) welcomes Finance Minister Tito Mboweni’s categorical commitment, under oath, not to use his “emergency” powers to bail out South African Airways (SAA) and that there is no “imminent” plan to do so.

This means the DA has achieved its immediate goal of preventing this bailout from happening secretly, behind the scenes, as happened previously when former Minister Malusi Gigaba, used his “emergency powers” under Section 16 of the Public Finance Management Act (PFMA).

Due to Minister Mboweni’s commitment not to do the same thing, the DA has removed its application from the urgent court roll.

However we have retained our application on the normal court roll, should the need arise in future to prevent the Minister using Section 16 of the PFMA for the same purpose.

The DA is resolute that it would be wrong for SAA to be bailed out once again, at public expense, while millions of people face such hardship.  The country faces so many more urgent needs right now.

On the basis of Mboweni’s commitment we are satisfied that there is no need for an urgent hearing, although we remain on high alert for other illegitimate attempts to fund SAA. We have written to the Minister’s lawyers accordingly, and that letter is available here (insert link).

However, Minister Mboweni’s affidavit, belatedly filed in response to the DA’s court challenge, raises new alarms about how SAA might be bailed out using other means. Most worryingly, he suggests using pension funds to “invest” in SAA, which raises the prospect of the Public Investment Corporation being forced to give money to SAA.

The DA will oppose any publicly-funded bailout of SAA, whether through direct cash, government guaranteed loans, or an attempt to abuse pension funds.

Minister Mboweni should do the right thing and refuse any government financial support for SAA.

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