Sant insists restructuring should be headed by 'acceptable people'

Opposition leader Alfred Sant said yesterday that the opposition agreed on the need for the restructuring of Air Malta only as long as this process was headed by persons who did not have conflicts of interest and were acceptable all round.

Dr Sant said in parliament during the debate on the national airline that the Opposition's backing for government motions to raise the airline's share capital was not a blank cheque for restructuring.

The problems of the airline did not stem from its core operations, but from the mistakes made by the government's appointees, the friends of friends who had made serious mistakes in the purchase of RJ aircraft and the investment in AzzurraAir which had cost Air Malta millions of liri.

The government should shoulder its responsibility for the damage the airline had suffered as a result of the actions of its appointees, and the workers should not now be made to suffer as a consequence.

Air Malta was vital for tourism, and the opposition would remain strongly against any measures which undermined the airline. Those who were trying to bring low-cost airlines to Malta on the pretext of helping tourism had a very shortsighted view of the tourism industry.

The opposition would also resist any measures which it viewed as opening the door for private airlines to exploit Malta's tourism while Air Malta was turned into a leaden bird, as the PN used to describe it in the past.

The government, he said, should make known its restructuring plans for Air Malta, while ensuring that the people at the helm of the process were acceptable and did not have an interest in sidelining certain people.

One could not have a situation where people received commissions, the airline made losses and then it, and tourism, were allowed to suffer.

David Agius (PN) said that whoever had said in the past that Air Malta was a leaden bird had been mistaken and had shown lack of vision.

He said the national airline must focus on the advantages which made it different to others and use its assets in the best possible way. Was it using IT in the best way?

Greater linkage between Air Malta and Malta Tourism Authority offices and embassies overseas could cut costs and achieve better results.

One area in which Air Malta could possibly do better was in helping people with special needs travel overseas on special fares. It also needed to beef up its frequent-flyer programme with more attractive benefits.

A lot of work needed to be done regarding prices and marketing because the general perception was of high prices, which was not necessarily the truth.

The national airline's image also needed to be improved. Its new fleet would go some way towards achieving this.

Mr Agius said Air Malta needed to be defended through effective advertising, development and research. Rather than just core operations, it would do well to cut its losses on its subsidiaries, selling them off if necessary. It had made a good deal recently with the sale of MedIsle Holidays accommodation in Bugibba.

He augured that the forthcoming discussions with the unions representing Air Malta's 2,000 employees would identify what was doing well and whatever needed to be pruned.

Joe Brincat (MLP) said he disagreed with the view that Air Malta should not invest in related activities, such as the hotel business. SAS, among other airlines, successfully operated hotels in many countries.

The problem at Air Malta was that its officials had persisted in investments which were manifestly wrong. And, unfortunately, no one was held to account.

Dr Brincat insisted that in a context of EU rules, Malta should seek to protect the interests of its companies. That was, after all, what other EU countries did.

Dr Brincat referred to the proposed grant of land to Air Malta by the government and said that this grant should be given under other regulations and not emphyteusis, so as to protect the state's interests, especially if the airline should be privatised. If anything, there should be tighter legal restrictions on the use of the land and its transfer lest somebody argued in future that the existing conditions were incompatible with a grant by emphyteusis.

Charles Buhagiar (MLP) said Air Malta still had a number of pioneers who had worked hard to make it a success story, and who were owed a vote of thanks. The airline's own growth and its opening of new routes had been the major building blocks in the growth of tourism to what it was today.

The airline today was going through one of its worst patches ever. There were a number of things it could do through its marketing and pricing strategies, not only in tourism but also in business travel.

Referring to the transfer of property to Air Malta, Mr Buhagiar asked if the government had kept in mind how long Air Malta had been occupying the real estate involved, albeit without title? How had the premium of Lm3 per share been pinpointed?

The prices quoted also showed how the value of real estate had surged by some 2,500 per cent since 1987, especially after the government had stopped issuing building plots at affordable prices. The government should seek to do something to restrain such rampant escalation.

The situation was such that young couples who wanted to have their own homes were binding themselves to huge loans for the rest of their working lives. Building schemes needed to be rationalised and more areas should judiciously be released for development, he concluded.

Labour MP Anglu Farrugia said Air Malta employees had never been placed in such a degrading position as now. It would be negligent of him not to say that the people were concerned at the arrogant way in which the government was administering the country in relation to the workers.

What did the future hold for Air Malta employees? Would anyone be held to account for the mistaken decisions that had been taken? Indeed, a parliamentary inquiry should be held to see who took thousands, if not millions of liri from the people.

Dr Farrugia said that workers at Air Malta were promoted if they were Nationalist and transferred from one office to another if they were Labour. Investigations should be held into the way Air Malta had been administered in the past so that if there had been abuses, those who abused would be held to account.

More people close to the Nationalist Party had now been employed and one of the reasons behind their employment was to act as strike breakers if the General Workers' Union called a strike, Dr Farrugia said.