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Poor visibility in Air Malta’s operations

The public that owns Air Malta deserves to be kept updated on how the national airline is performing, especially since the government is now no longer allowed to provide state aid to the company. But its chairman, Charles Mangion, thinks otherwise.

Asked by journalists what the cost of recent operational disruptions was to the company, he acknowledged that the issues had, naturally, come at a cost. However, he hastened to add that he “was not comfortable” divulging details. He also sounded complacent, if not also insensitive, about the inconvenience caused to Air Malta customers when he said: “We are not the only (airline) that has delays.”

Dr Mangion may need reminding that, in September 2013, Air Malta had issued a press statement to inform the public on the disruption caused by pilot sickness and how this was affecting its operations. It had also said that, as a result of the extraordinary high level of sickness reported by pilots, costs incurred by the national air carrier in just one day were likely to be more than €500,000.

In August 2016, in a lawsuit between Air Malta and the pilots’ union, the company claimed that strike action could lead to the collapse of the airline and move the company into bankruptcy.

Earlier this year, in late April, when Dr Mangion was already chairman and Tourism Minister Konrad Mizzi was politically responsible for the airline, Air Malta did not feel uncomfortable letting it be known that  instructions issued by the pilots’ union for members not to fly the newest aircraft to join the fleet would initially cost it over €180,000 in compensations and charges.

So, when it suits the airline, the public is fed detailed information on the costs of operational disruption because of strained industrial relations. However, when apparent bad planning by management leads to similar operational disruption, it is ‘uncomfortable’ to improve the visibility to stakeholders on how the company is being run.

If Air Malta were a public-quoted company, shareholders would be vociferous in demanding a statement from the board of directors on how the entity, which, in March 2017, posted a loss of €13 million, an increase of €9 million on the previous year, was measuring up to its budgeted breakeven in March 2018. No such statement has been made so far either by the company itself or by the minister.

It is critical that Air Malta’s financial results for 2017-2018 are communicated to Parliament and the public soonest. Dr Mizzi said he hoped the airline would break even this year but, so far, he has not confirmed whether his predictions were correct.

If forecasts were correct, everyone should breathe a sigh of relief, at least for the airline’s short-term prospects.

However, if the national air carrier is still incurring significant losses, then the public needs to know what comes next. How are the EU competition authorities reacting? Who is financing these losses?

The chairman of Air Malta felt the need to inform the public personally, in the minister’s presence, that in-flight meals will no longer be free, however, many rightly feel more concerned about the future of the airline and whether it is hitting its financial targets, especially given recent avoidable operational disruptions.

Poor visibility on operational and  financial issues cannot be doing Air Malta any good.

This is a Times of Malta print editorial

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