Air Malta will have to shed some 600 employees if it is to become a viable airline, Finance Minister Tonio Fenech confirms in an interview today.

“I always said there are significant numbers of workers in Air Malta and the numbers need to be reduced because we can only compete if we run a leaner organisation,” he tells The Sunday Times.

Mr Fenech defends the restructuring plan being mapped out by Ernst & Young before being submitted to the European Commission in May. He says the restructuring programme had already slashed costs and the losses for the last financial year for Air Malta are expected to be below the €50 million originally predicted.

Fielding questions about the employees frustration in the wake of uncertainty, Mr Fenech acknowledges the mistakes made in the past. “The problem is that unfortunately Air Malta was a bit stuck in the past. It wasn’t rapid enough to acknowledge the challenges probably encountered by every legacy carrier,” he says.

Mr Fenech describes the Labour Party’s decision to hold a news conference about Air Malta as hugely irresponsible and intended only to win political points. Underlining the strategic need for Air Malta, he also says other airlines had expressed interest in teaming up with the national airline but that they preferred to see the airline first solve its problems before taking talks further.

Watch excerpts of the interview by clicking the link above. Read the entire interview in today’s edition of The Sunday Times here: http://www.timesofmalta.com/articles/view/20110313/interview/no-plane-sailing-reform