PIA incurring Rs2 billion monthly losses

According to the aviation secretary, the depreciation of the rupee and rise in fuel prices were the two major factors for PIA’s losses

1
326

ISLAMABAD: Aviation Secretary Mohammad Saqib Aziz on Wednesday informed the Senate Standing Committee on Aviation that Pakistan International Airlines (PIA) was incurring Rs2 billion per month operational losses due to a jump in global oil prices and the depreciation of the rupee.

In a hearing of the Senate Standing Committee on Aviation, Mr Aziz shared these operational losses were in addition to liabilities of Rs400 billion including bank loans, reports Dawn.

According to the aviation secretary, the depreciation of the rupee and rise in fuel prices were the two major factors for PIA’s losses.

He added another major reason for the financial woes of the state-owned airline was overstaffing which had contributed to non-payment of salaries this month to its employees.

“The matter has been taken up with the finance division and we hope that it will be settled soon,” said Mr Aziz.

The Senate committee meeting had been called for a briefing on several problems regarding aviation, especially PIA and the complications in its new software which was causing errors during bookings, issued faced by parliamentarians and accusations of money laundering by PIA officers.

The Senator Hasil Khan Bizenjo asked how long PIA would continue to suffer losses and Mr Aziz elaborated that a business plan to turn around the state-owned airline had been shared with the previous PML-N administration and was still under process.

While speaking on the occasion, PML-N Senator Mushahidullah Khan and chairman of the Senate Standing Committee on Aviation blamed PIA’s massive losses to wrongdoing in the procurement of spare parts for its fleet.

Mr Khan said the losses could be reduced if spares were purchased in a transparent way.

Also, the standing committee was apprised that PIA was suffering from overstaffing and had 13,500 regular employees and 3,500 daily wagers and ratio of workers per aircraft stands at 450.

According to the aviation secretary, if the non-core staff from engineering, catering and ground handling crew were separate from the core employees, the ratio of workers against one aircraft would decrease to 135, which would be similar to India.

And the engineering section alone caters to more than 4,000 employees within PIA and members were told that its employees hadn’t received their salaries this month because of financial woes.

Moreover, it was shared that the state-owned airline spent around 18 percent of the revenue on each staff member.

When queried about the financial woes, Mr Aziz said all earnings went straight into banks, which deducted the loans obtained by PIA before disbursing the remaining amount.

The committee chairman brought the issue of recent reports of PSX declaring PIA a defaulter to the attention of the aviation secretary.

In response, Mr Aziz said the PSX had issued a warning after PIA management’s failure to provide details of audited accounts and inability to hold its annual general meeting, although trading of shares hadn’t been suspended.

1 COMMENT

Comments are closed.