Gigaba in bid to buy time for SAA
Financials deadline missed
FINANCE Minister Malusi Gigaba has asked Speaker Baleka Mbete to extend the deadline for SA Airways (SAA) to submit its audited annual financial statements to Parliament because of financial troubles at the airline.
In a letter to Mbete yesterday, Gigaba said SAA had serious challenges which needed to be addressed before the financials were tabled.
“Due to financial challenges faced by SAA and the fact SAA’s external auditors have raised concerns regarding the airline’s (viability), SAA has missed the deadline for submitting audited financial statements on or before August 31 to the shareholder as stipulated in the Public Finance Management Act,” Gigaba said in his letter to Mbete.
“The delay in finalising SAA’s annual financial statements also means that as the executive authority responsible for SAA, I will not be able to table the airline’s annual report and audited report on or before the stipulated date (September 30). Therefore, I humbly request an extension of the deadline for tabling SAA’s annual report to November 30.”
SAA missed the mandatory September 30 deadline for all departments and state entities to submit financials to Parliament.
Gigaba said he had missed the deadline because of circumstances beyond his control.
This is the third time SAA has asked for an extension of the deadline to submit its financials in Parliament.
Former finance minister Pravin Gordhan also asked for extensions during his tenure because of the airline’s serious financials problems.
The tabling of the reports for 2014 and 2015 to Parliament were delayed.
SAA posted heavy losses of R4.6 billion and R1.6bn, respectively.
The request by Gigaba to extend the deadline comes after he extended a bailout of R3bn to SAA to pay Citibank and R2.2bn to Standard Chartered Bank.
SAA has been scrambling for cash over the last few months with lenders demanding payment of R6.8bn owed to them by the end of last month.
Recapitalisation
However, Gigaba tapped into the National Revenue Fund to get R3bn to pay Citibank.
SAA had told Parliament there were nine other lenders who were keen to extend the loans until certain conditions have been met.
SAA also said they would soon appoint the restructuring officer to deal with some of the problems at the airline.
Gigaba was expected to announce plans in his mid-term budget on the recapitalisation of the airline.
It was reported yesterday that incoming chief executive Vuyani Jarana met a British industry expert in a quest to turn around SAA.
Part of the work of the external restructuring expert was to deal with the conditions of the lenders and return the airline to profit.