The government may not be allowed to weaken the Government Employee Pension Funds any further by buying shares in struggling state-owned enterprises in an attempt to buoy up these sinking entities,” says Adv Alberts, chairperson of the FF Plus.
According to media reports, the Treasury is still determined to sell R10 billion of its 39% stake in Telkom in order to bail out the failing SAA.
“We suspect that the easiest way to do this would be to use the Public Investment Corporation (PIC) to buy the shares. The FF Plus will strongly oppose any such endeavour. Shares in struggling entities will not add value to the PIC and will only result in the dilution of the funds in the long term.
“This is exactly what happened in 2015 when the government sold its 14% stake in Vodacom to the PIC to re-capitalise Eskom.
“What will the government sell next in an attempt to save the SAA? Unless the airline makes drastic changes, it simply cannot be expected that the entity will become profitable in the foreseeable future and then it will just have to be bailed out once again, like so many times before.
“At present, the SAA is no more than a bottomless pit that is sucking the fiscus dry,” says Adv Alberts.
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