Hon Chairperson, South African Express was established in 1994 as a regional feeder airline to SA Airways. Some of Transnet's subsidiaries and business divisions that are strategic to the objectives of government have been transferred to become stand-alone entities, as was the case with SAA.
Needless to say, whereas SAA is still struggling to survive independently, South African Express can be considered to be a successful, profitable regional airline. In 2004, the Minister for Public Enterprises approved Transnet's four-point turnaround strategy to focus on core freight services, namely the provision of rail, ports and pipelines, which take Transnet completely out of the aviation sector.
On 8 April 2007, Cabinet approved the separation of South African Express from Transnet to be represented by the Minister for Public Enterprises as a state-owned enterprise.
Siende dat Sax reeds op 'n winsbasis funksioneer, is die vraag hoekom dit nie geprivatiseer kan word nie. Die regering is van mening dat dit nie moontlik is dat 'n private lugredery aan die streeks- en binnelandse kleinmarkbehoeftes sal voorsien nie en dat hierdie mark dus weer afgeskeep sal word.
Sax opereer tans na sewe streekbestemmings en 11 plaaslike bestemmings met ongeveer 120 vlugte per dag. Tans het Sax net op sekere roetes mededinging met ander lugrederye. Die DA maak beswaar dat Sax as 'n skedule 3(b) in plaas van 'n skedule 2 van die Openbare Finansile Bestuurswet geklassifiseer word, net soos in die geval met Infraco, en sal ek dit by die volgende debat bespreek.
Die DA wil dit ook duidelik stel dat Sax nie 'n tweede SAL moet word wat kort-kort bakhand staan vir geld nie en wat vir oorlewing van die belastingbetaler sal bedel nie. Indien dit nie meer aan die vereistes van openbare onderneming voldoen nie en in 'n finansile krisis ontaard in die toekoms, moet dit gelikwideer word. Indien Sax suksesvol finansieel funksioneer en ter wille van effektiewe bestuur, moet dit geprivatiseer word ter wille van groter mededinging in die openbare mark. Ek dank u. (Translation of Afrikaans paragraphs follows.)
[In view of the fact that Sax, South African Express, is already operating profitably, the question is why it cannot be privatised. The government is of the opinion that it is not possible for a private airline to meet regional and domestic small market needs and that this market will therefore be neglected again.
Currently, Sax is flying to seven regional destinations and 11 local destinations, with approximately 120 flights daily. At present Sax only has competition with other airlines on certain routes. The DA objects to Sax being classified under schedule 3(b) instead of schedule 2 of the Public Finance Management Act, as is the case with Infraco, and I will discuss this in the next debate.
The DA also wants to make it clear that Sax should not become a second SAA that regularly has to beg for more money and that will need money from the taxpayer in order to survive. If it no longer complies with the requirements of a public enterprise and turns into a financial crisis in the future, it should be liquidated. If Sax is financially successful, and for the sake of effective management, it should be privatised in the interest of greater competitiveness on the open market. I thank you.]
Mr Chairperson, comrades, friends, this is so predictable and even boring. We've addressed this issue, really. This detains the House unduly. However, essentially, on the issue of privatisation, it's not the answer to everything. SA Airways itself was privatised and a portion of it was sold to Swissair. Let us learn from that experience.
Secondly, if you look at the role of this airline, it's addressing the needs, substantially, of sectors of the airline industry not catered for by the private sector. Only a state-owned airline can do that, not just in this country but in many other countries in the world.
Thirdly, look at the issue of a broader developmental state. The role of state airlines in that regard has to be taken into consideration.
Fourthly, yes, we have repeatedly said to the management, including the CEO of SA Express that they cannot expect to come back to the National Treasury every time they have difficulties. Indeed, in our report to Parliament, we have said that they will not be rescued by the national fiscus all the time.
Finally, yes, there is the possibility of the private sector playing a role but privatisation is not the only answer. There are many ways in which the private sector can indeed get involved. Yes, if it comes to it that this airline is a drain on the resources of the country and if it precludes us from providing housing and electricity - we are clear that an airline is not a basic need in the way water, food and clothing are - then we will consider privatisation. It's not a principle.
However, let's not be so dark and pessimistic. Dr Van Dyk says, on the one hand, that this SA Express is being managed very well. On the other hand, he's insisting that it's going to be a failure. What is this if it is not the typical doom and gloom of the DA?
On scheduling, we did not decide on this lightly. We'll discuss it in the forthcoming debate. Both sides presented their cases - those who argued for Schedule 2 and those who favoured Schedule 3(b). We even said to the researcher: Present a balanced argument, which Eric Boskati did - and thank you very much, if he's here.
Indeed the department itself gave us a very itemised presentation of the advantages and disadvantaged of both sides - Schedule 2 and schedule 3(b). Finally, we said that instead of voting on the Bill in the last week of the last quarter, we should defer the matter to give the committee, the various parties and the executive more time to decide which Schedule is more appropriate. In fact, Mr Manie van Dyk and his party came up with nothing except to bleat: Schedule 2! Schedule 2! Schedule 2! Where's the argument? Even on privatisation ... [Time expired.]
Bill read a second time.