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Cape Town - South African Airways (SAA) will receive a cash injection from National Treasury during the course of the year, but the size of it was still being debated, outgoing director general of finance, Lungisa Fuzile, said on Tuesday.

Fuzile told Parliament's standing committee on finance that this much was made clear by former finance minister Pravin Gordhan in February. "We need to give a capital injection and it will happen this year," he said, adding that the amount had not been determined yet. "That is what we are pondering."

Fuzile stressed that "the capital situation is inappropriate, there must be a right balance" and said once a capital injection had been allocated it would mean less pressure in terms of financial guarantees from government. Fuzile, in his last appearance before Parliament before he leaves his post next week, stressed that "good work" was being done at SAA and said this gave impetus to providing "substantial" equity to the cash-strapped national airline.

Responding to questions from opposition MPs about the level of government guarantees, Fuzile said there was no fear that creditors were about to call in substantial amounts of debt that would trigger guarantees. He noted that government's biggest exposure was in terms of guarantees of some R300 billion to Eskom, followed by the Passenger Rail Association of South Africa (Prasa) with a fraction of that at R38 billion.

While the total sum of guarantees to state-owned enterprises of about R400 billion was substantial, it was not in excessive proportion to the national budget. SAA has made headlines for being termed technically insolvent, and for the tense relationship between its chairwoman Dudu Myeni and the finance ministry.

- African News Agency (ANA)