Government grants South African Airways $346m to make severance payments

South African Airways has received a further 5b rand ($346m) from the Department of Public Enterprises to help make severance payments to laid-off staff as part of its rescue plan, administrators of the plan said on Tuesday. SAA entered a local form of bankruptcy protection in December 2019 after roughly a decade of financial losses, with its fortunes worsening after the COVID-19 pandemic grounded flights. The government committed to providing 10.5b rand to bailout the airline in October’s mid-term budget. The business rescue practitioners hired to restructure the airline said they had received 7.8b rand from the government including the latest payment. The administrators, who have proposed a plan which includes reducing the airline’s staff by around two-thirds, said the money allowed them to pay cabin crew and ground staff that had accepted voluntary severance packages in August. More than 3,000 SAA employees have accepted severance packages, while 1,300 are still in negotiations, the administrators said.<br/>