Bailing out SAA and Sapo threatens spending ceiling, Gigaba warns
SAA will get another R4.8bn by the end of this fiscal year, but Gigaba warns government is losing patience with state-owned entities
The expenditure ceiling is threatened in the current financial year as a result of the government’s recapitalisation of South African Airways (SAA) and the South African Post Office (Sapo), Finance Minister Malusi Gigaba said on Wednesday. Delivering his medium-term budget policy statement (MTBPS) in Parliament, Gigaba said the government remained committed to operating within the expenditure ceiling over the medium term. However, the recapitalisation of SAA and Sapo put the ceiling at risk of a R3.9bn breach. Gigaba said the government was considering the disposal of assets, including its shares in Telkom, to offset these appropriations during the current financial year. More details would be provided in March. SAA and Sapo have both been in the throes of a serious financial crisis in recent years, which has posed a serious risk to the fiscus. State-owned power utility Eskom, which has the largest government guarantee at R350bn, has also been facing financial turbulence because of ...
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