Photo by: Reuters
National Treasury is to assume control of South African Airways (SAA), Minister in the Presidency Jeff Radebe announced on Thursday.
"SAA will be transferred from the department of public enterprises to fall under National Treasury," he told journalists in Pretoria, following Cabinet's fortnightly meeting the day before.
He said Cabinet was concerned about the performance of some state-owned companies, in particular SAA, the South African Post Office, and power utility Eskom, each of which had a critical role to play within the country's economy.
"President [Jacob Zuma] has assigned Deputy President Cyril Ramaphosa to oversee the turnaround of [these] three State-owned companies," Radebe said, adding that progress in this regard would be closely monitored by the presidency.
Treasury refused to flesh out the terms of its takeover.
"The minister of finance and National Treasury will not be giving any media interviews on South African Airways until the process of transferring the administrative powers relating to the airline company from the minister responsible for the public enterprises to the minister of finance has been finalised," Treasury said in a statement.
The transfer of administrative powers from public enterprises to Treasury would only be finalised by proclamation in the government gazette.
"Such a transfer of administrative powers from one minister to another is allowed for in terms of the Constitution of the Republic of South Africa," Treasury said.
"The process of transferring these powers will also involve consultations between the minister of public enterprises and the minister of finance as well as include the introduction of the minister of finance to the airline's board of directors."
Radebe said President Jacob Zuma would determine for how long Treasury would be in control of SAA.
The Democratic Alliance (DA) welcomed the move.
"This is a positive development, and we call on Finance Minister [Nhanhla] Nene to find practical solutions to the situation at SAA that will not require further bailouts from the state," said DA MP Natasha Michael.
"In fact, this latest move paves the way for minister Nene to engage with the private sector on the possibility of restructuring SAA, or even to privatise the entity."