South African Airways and the SA Post Office are two of the biggest failures when it comes to state-owned enterprises.
In SAA’s financial results for its 2017 financial year, the organisation reported a loss of R5.7 billion.
The SA Post Office is not much better, and for the year ended 31 March 2018 it posted a loss of R908 million.
Not only are the two enterprises a massive drain on the South African fiscus, the Post Office cannot even fulfil its basic mandate of delivering a letter.
Extensive tests by MyBroadband showed that the Post Office fails to deliver letters, or it takes months to send a letter from one town to another in the same province.
SAA has also found to be plagued by rampant corruption and maladministration, and has been described as technically bankrupt.
Your tax money well spent
Despite these massive failures, the National Treasury has allocated billions of rand to these companies – as detailed in its mid-term budget statement this afternoon.
The following amounts have been allocated to SAA and the Post Office, which ultimately will come from the tax South African citizens pay to the government through Sars.
- SAA – R5 billion
- SA Post Office – R2.9 billion
SAA was given the money as it needs to repay debt, and was described by Bloomberg as “one of several state-owned companies that will struggle to refinance or redeem debt without government assistance”.
Other organisations receiving funds include:
- Sanral – R5.8 billion
- South African Express Airways – R1.2 billion