News 24 on SAA
Cape Town - Despite its financial difficulties, South African Airways (SAA) is forking out R307m in sport-related sponsorships over four years, according to Public Enterprises Minister Barbara Hogan.
Replying to a parliamentary question by the Democratic Alliance's Donald Lee, Hogan said SAA was sponsoring Argentine golfer Angel Cabrera for three years up to August 31 this year.
SAA was also providing sponsorship for the Sunshine Golf Tour, ATP Tennis, Cricket SA, SA Rugby, SA Football Association, and ISM Golf Players.
The total value of SAA's sponsorships amounted to R268.3m in cash and R38.7m in free travel, which was spread over four years from 2008 to 2012.
"The individual value per sponsorship is commercially sensitive information and confidential, and thus cannot be disclosed. "Disclosure could be prejudicial to both SAA and the organisation being sponsored," Hogan said.
Lee on Wednesday said the R307m in sports-related sponsorships and free travel for sporting celebrities since 2008 meant that one fifth of the amount designated to SAA in bailout funds last year - R1.6 billion - had been spent on sporting sponsorships and free travel.
The mere fact that SAA had spent such a significant amount on sporting sponsorships, even while simultaneously requiring bailout funds, was difficult to comprehend.
"While the DA acknowledges the need to remain competitive in the global airlines industry, and that sponsorships can aid this, the sheer value of the sponsorships seems astonishing, and it seems highly doubtful that SAA is getting any bang for their buck.
"Faced with a choice of spending R307m on freebies and sponsorships, and financial stability, we would prefer the latter from a state-owned enterprise," Lee said.
The bailouts for SAA over the past five years had come either as cash injections or loans guaranteed by the state.
The history of these bailouts showed that every year the state was paying a fortune to keep SAA afloat - 2004/05 R6.1bn, 2005/06 R2.4bn (conversion of loans to equity), 2006/07 R1.3bn (loan guarantees), 2007/08 R5.4bn, and 2008/09 R1.6bn.
"""My opinion is that the government should stop giving them money!! If they can’t make it on their own the government should privatize them.
At least this way all the other private airlines can compete on a level playing field!!!"""