Strike-hit SAA says only a deal with unions will end crisis

Published Nov 19, 2019

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Johannesburg - South African Airways (SAA)

resumed some regional flights on Tuesday but warned that only a

deal with striking unions can resolve its current crisis, as the

government said it has no more money for the cash-strapped state

carrier.

The airline has cancelled hundreds of flights since the

strike began on Friday, with the stoppage initially costing R50

million per day, though that figure has

come down as some flights have resumed.

It has also jeopardised talks with lenders, SAA said.

The carrier met with the unions and Public Enterprises Minister Pravin Gordhan on Tuesday morning, but SAA

acting chairwoman Thandeka Mgoduso said Gordhan had reiterated

that there is nothing in the public coffers for the airline.

"The statement is the same, there is no more money," she

told a news conference, adding that SAA would continue talks

with the unions in the afternoon.

"The players who will resolve this ... are SAA and the

unions, not the minister."

She later told Reuters that the government had not made any

recommendations on what the airline should do to end the strike

over job cuts and wages.

SAA has not made a profit since 2011 and has relied on state

bailouts for its survival.

A spokeswoman for the National Union of Metalworkers of

South Africa (NUMSA), which called the strike alongside the

South African Cabin Crew Association (SACCA), said the unions

had given the minister a framework for ending the strike and

solving SAA's financial problems.

A statement issued by the Department of Public Enterprises

said the government was committed to saving the airline, but not

with money, with repeated bailouts becoming a "moral hazard".

It said the minister had urged the unions to work with SAA,

with the ultimate aim of saving both the airline and jobs. But

this would "require everybody to make sacrifices".

Another large union at SAA, the National Transport Movement

(NTM), is not participating in the strike and says it has a

mandate from members to accept the offer of a 5.9% wage increase

for the next financial year.

However, it will only do so if the airline removes a clause

saying it is conditional on the company having sufficient funds

for the increase.

SAA executives said roughly a fifth of the SAA workforce was

still on strike. About 11,000 passengers had been scheduled to

fly with the airline on each day of the action so far.

NUMSA and SACCA threatened on Sunday to extend the strike to

members at more airlines and other organisations across the

industry.

The strike has cast doubt over SAA's survival hopes. SAA

says it needs to cut headcount to restore profitability and is

unable to raise its wage offer any further because of its dire

financial situation.

Acting finance chief Deon Fredericks told the conference

that a multibillion-rand loan being negotiated with banks to

provide working capital would, once secured, leave SAA in a much

better position to cope with the impact of the strike.

If this is not in place by February, he later told Reuters,

SAA would look for other lenders.

The government is still looking for an equity partner for

the airline, but SAA must stabilise first, he said, a process

that could take at least two years.

In the meantime, other executives said that a few hundred

workers had returned to work despite the strike, enabling SAA to

resume some regional flights. International flights had already

resumed but domestic flights remain grounded.

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