Government, opposition in talks chaired by President

A three-hour meeting at San Anton Palace presided over by President George Abela yesterday kicked off talks between the government and the opposition on the future of Air Malta.

Finance Minister Tonio Fenech led the government delegation while Labour leader Joseph Muscat headed the opposition’s.

The government said the meeting was called by Mr Fenech and was intended to explain the state of affairs at Air Malta within an international context characterised by low-cost carriers and high fuel prices.

Mr Fenech also outlined the government’s commitment to achieve viability at the airline since it was a strategic asset for the economy and tourism.

Six years ago, as an industrial relations lawyer, Dr Abela had acted as a broker bringing together the four unions represented at Air Malta in restructuring negotiations with the government.

There is no information so far on his precise role this time.

The Labour delegation included former ministers Karmenu Vella and Charles Mangion, tourism spokesman Marie-Louise Coleiro Preca, former Air Malta chairman and MEP Louis Grech and the party’s chief executive officer James Piscopo.

The meeting started at noon and was followed by another meeting at the Finance Ministry between Mr Fenech and a General Workers’ Union delegation.

At the end of the meeting Mr Fenech said they only agreed on how to proceed with the talks.

“It is still early days,” he said when asked whether the government had outlined its restructuring plans for the airline to the union.

Similar remarks were made by GWU general secretary Tony Zarb. He said the two sides agreed on a number of meetings and who should be present for them.

Air Malta chairman Sonny Portelli and a delegation from audit firm Ernst & Young, which is advising the government on the restructuring process, were also present for the meeting at the ministry.

Another meeting with the other unions represented at Air Malta is expected to be held today.

The government is seeking EU approval to inject money into the airline, which has posted losses for two years running.

EU sources quoted by The Sunday Times said Air Malta could not survive unless it sheds staff as Brussels would never permit state aid to subsidise unproductive jobs.

The GWU has insisted workers should not be blamed for the state the airline is in. It has also insisted that the workers are burdened with enough sacrifices from previous efforts to restructure the company.

The government has notified the European Commission of its intention to grant Air Malta urgent rescue aid which would then be followed by restructuring aid. Any aid has to be tied to a restructuring and downsizing programme agreed with Brussels.

In the Budget, the government spoke of a €100 million injection into Air Malta’s shareholding capital but this was turned down by the Commission, leaving no other option but state aid.