The Malta Hotels and Restaurants Association is on a collision course with the government over Air Malta’s future, disagreeing with both its insistence on financial viability and its majority shareholding.

Chairman Tony Zahra told the Times of Malta that the MHRA position remained what it had been for years: that the current ownership model would not work, and that the government should only retain a 20 per cent shareholding.

This is diametrically opposed to what Prime Minister Joseph Muscat insisted a month ago during the electoral campaign when he said a majority shareholding was the preferred option.

The Nationalist Party, on the other hand, said that it would be ready to keep only a minority shareholding – as long as it retained ‘control’.

The current ownership model will not work, and the government should only hold 20 per cent

The MHRA is also in disagreement with newly appointed Tourism Minister Konrad Mizzi, who said just after being sworn into the Cabinet that his priority for the next 12 months was to restructure the national airline and ensure it became financially viable before finding a strategic partner.

Watch: No strategic partner before Air Malta is restructured - Konrad Mizzi

According to the five-year restructuring plan, which ended in March 2016, the airline is meant to be registering a profit.

At the start of the restructuring plan in 2012, the airline made a €78 million loss. It reported a loss of €16 million for the year ending March 2015, and the forecast was to reduce this to a loss of €4 million in 2016. However, the company is several months overdue with its 2016 accounts.

Mr Zahra does not believe financial viability can be achieved unless the ownership model is changed.

“What does the word ‘restructured’ mean? We have heard it said so many times for so long. ‘We need to restructure…’ Restructure what? It won’t happen until such time as the ownership model changes. It just won’t happen,” he said.

Attempts to find a strategic partner for the national airline failed to get off the ground during the Labour government’s first term, a mooted deal with Italian carrier Alitalia having been dropped earlier this year.