Workers will receive the pay hike ‘if there’s money in February’ but that seems unlikely
SAA, which is back on its full flight schedule after a bruising weeklong pay strike, has reiterated that it will not be able to fund the 5.9% wage hike.
Business Times reported that the airline will know on Monday if it will get the R2bn bailout for working capital to fund its daily operations, including the payment of salaries to employees. This after lenders and SAA’s shareholder met on Friday over additional state guarantees that financiers want before they will agree to unlock funds.
Ratings agency S&P Global changed its outlook on SA’s sovereign credit from stable to negative on Friday, saying low GDP growth, upwardly revised fiscal deficits and a “a growing debt burden are damaging SA’s fiscal metrics”.Economists.co.za chief economist Mike Schussler said the wage increase, if workers do get it, will be seen as “credit negative” for SA. “This is a company that’s deep in financial crisis, the increase is way above inflation and it’s not good for SA,” said Schussler.
“SAA is living on bailouts so it cannot afford the increase, let alone an increase above CPI ,” said Leitch. Instead of continuing to bail out SAA, the state should be using the funds to provide services to the poor, he said.
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