Don't tap into PIC for SAA bailout - union | Fin24
 
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Don't tap into PIC for SAA bailout - union

May 24 2017 20:00
Lameez Omarjee

Johannesburg – A public services trade union has voiced concern over the possibility that a bailout for South African Airways (SAA) may be funded by the pension fund of government employees.

This is according to a statement issued by the National Union of Public Service and Allied Workers (Nupsaw) on Wednesday.

READ: PIC in the mix of options to fund loss-making SAA

Fin24 reported that Treasury would be considering the Public Investment Corporation (PIC) as one of the options to finance the lossmaking airline. This was revealed during a question and answer session in Parliament, where Democratic Alliance MP Alf Lees asked where the funding to refinance SAA would come from.

Acting Treasury director general Dondo Mogajane did not reject the possibility of the PIC as an equity partner outright, but said there are “options available”.

Nupsaw general secretary Success Mataitsane said that this intervention is only a “short-term solution” and will have “devastating effects”. He explained that the Government Employees Pension Fund, which is managed by the PIC, makes up a significant portion of public servants' wealth. “Any irresponsible investment, like the one contemplated by the National Treasury, will threaten the sustainability of the fund.”

He highlighted that the depletion of these funds would leave pensioners struggling to cover “unexpected” expenses.

Nupsaw called out SAA as a system dominated by cronyism and corruption, and has urged Treasury to refrain from using the PIC to refinance the airline.

Read Fin24's top stories trending on Twitter:


saa  |  pic  |  national treasury  |  labour  |  trade unions  |  pension  |  sa economy
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