To the rescue, carefully

Talk of a compromise on a rescue plan for Air Malta was very much in the air at the weekend. According to my sources, usually correct, the public investments minister, the national airline, and the four unions representing the workers have finally reached agreement on a way forward. The union leaderships will now require the approval of their members. They are expected to seek it straightaway.

It is in the nature of such matters that the compromise will not quite meet the parameters the various sides had set for themselves. The government and company will get less than they set out to acquire in terms of reduced operating outlays, as a first step to cutting core operating losses.

The unions will have had to agree in draft form that their members will forfeit more income than they felt they should give up, once revised work practices and, where applicable, outright reduction in monetary compensation are quantified in take-home pay.

The public investments minister is unlikely to be grilled into a burnt toast by the prime minister and his peers, who would have given him a broad brief. He will still be required to explain and justify to them the restricted terms of the draft agreement, probably at this morning's Cabinet meeting.

The leaderships of the four unions will have a much harder task. It is not easy to convey all that must have taken place during the tripartite discussions, the heated nuances of each and every argument, the implications carefully weighed at every likely breaking point, of which there tend to be several when serious discussions and negotiations are taking place.

The more unpalatable the objectives, the more binds and potential dead-ends there would have been. The outcome, which the union leaders will recommend to the membership, can never be to their total satisfaction. One and all - management, the government, the unions, and their members - have to be guided by long-term considerations.

The subjective context for many of the employees will be that Air Malta lost cash reserves for reasons that cannot be laid at their doorstep. That is true to a very considerable extent. Without ignoring the fact that the responsibility for that outcome should be laid where it fits, the objective cannot be other than the present reality.

Which is that core losses are mounting. The full reasons, a compound of the worldwide state of the airline sector in general, and factors particular to Air Malta, should be made public as soon as will now be possible. Segmental analysis which will be included in the audited accounts for the year to July 2003, still not published, will give some indication. The audited accounts for the year to next July should this time be made public within weeks. Aer Lingus manages that. Why not Air Malta, whose auditors are no less able and focused than their Irish counterparts?

Also, pruning of expenses must continue. Once the rescue plan is put into operation, it will be still more than ever improper to retain the high-cost services of an expatriate CEO whose role can be filled from within the resources of Air Malta itself without any less value being added.

Before all that can come about, the agreement reached in principle as rumoured over the weekend has to clear its final hurdle. The airline's employees, however much they will not like the fact of how each will be personally affected, will be unlikely to ignore the most basic of personal considerations.

Which is, that they are the main stakeholders in the company. Agreeing to move forward would not leave them to carry the baby. It will offer them an opportunity to save it and care for it more directly. The discussions and negotiations were a minor saga. If the employees endorse their unions' recommendations, it would be the end of a chapter, not the story.

A new beginning will dawn. One whereby the rescue plan, which cannot depend only on cutting the cost of the human resources component, can be put into effect without delay. And also a beginning whereby the employees, through their unions, should be in a closer and better position to monitor, and even be part of, how Air Malta will now function.

There is much yet to be done, with the management in particular being subject to scrutiny by the employees and their unions, and by the public investments minister, who is ultimately accountable for the company. The sooner the process starts, the better. Failure to agree on attempting to move forward would simply throw the company and its stakeholders into bigger problems.