The Independent Labour Caucus (ILC)‚ a collection of 12 unions‚ is objecting to the possible use of state employees’ pension funds to bail out South African Airways.
SAA owes R6.8 billion to banks‚ payable at the end of September‚ with several banks refusing to extend repayment terms.
The Government Employees Pension Fund is invested into South African companies through the Public Investment Corporation (PIC) and it is this that may be used to pay the airline’s debt. The PIC invests about 1.8 trillion in assets‚ according to economist Professor Alex van den Heever.
The Independent Labour Caucus includes teachers’ union Naptosa and Hospersa‚ which represents hotel staff. It has threatened court action should fund trustees approve the use of PIC funds for SAA debt.
The organisation has written to the fund’s board of trustees‚ the Minister of Finance Malusi Gigaba and Deputy Minister of Finance Sfiso Buthelezi‚ who chairs the PIC board.
The ILC said trustees of pension funds had to be independent and act in the best interests of its members. It threatened court action should workers’ pension funds be used to bail out SAA‚ which it said had a bad business record.
Independent Labour Caucus chair Basil Manuel said: “Trustees should also act in a transparent manner and therefore it is in the public interest‚ but more so in the interest of members of the Government Employment Pension Fund‚ to divulge the investment mandate of the PIC. The perception has been created during the past few months that the PIC has an open mandate as several investments have been made that have not been in the best interest of the Fund and its members.”
Gigaba last week told trade union federation Cosatu that he could not guarantee that the PIC wouldn’t be used by the state to capitalise state-owned enterprises.
Last week‚ TimesLIVE e-mailed the PIC to ask if it would use government pension money to bail out SAA. The PIC did not reply.