Up, up and away: the Air Malta saga

If it feels like we have been hearing about the demise of Air Malta for years, it is because we have

File photo
File photo

If it feels like we have been hearing about the demise of Air Malta for years, it is because we have.

In a recent comment he gave to the media, the airline’s Executive Chairman David Curmi said, “In the last restructuring plan approved by the European Commission in 2012 there were the same exact number of people who were supposed to be made redundant. Over the last ten years the redundancies did not happen and now we do not have another chance. This is the last chance to save it.”

In the previous year, 2011, Air Malta was in the middle of a restructuring programme that saw the Maltese government subsidise the airline to cover its €50 million in losses, sack key executives including the CEO and plan a radical downsizing of the airline. But the downsizing never happened.

We can go back even further than that, thanks to the convenience of Google search at our fingertips. In 2007 the pilots were already in a dispute with then Nationalist Minister Austin Gatt over pay cuts. The negotiations, threats from both sides and ensuing deadlock went on for years and the issue finally came to a head in 2020 when COVID struck and tourism came to a standstill. The chop came swift and brutally: 108 pilots who had refused to take a cut in their take home pay were sacked.

If we rewind even further, in 2004, Minister Gatt was in talks with the unions on how they could recoup the millions the airline was losing without having to let employees go. One report said that, “Among the immediate measures, overtime is to be severely curtailed and allowances reduced across the board… The company is already trying to make internal changes to its management and the number of group heads will be reduced from 26 to eight.”

In fact, it is hard to remember the last time Air Malta was truly profitable. Despite all the bragging by (former Minister) Konrad Mizzi, it was all smoke and mirrors because the slight profit when he was Minister was due to the selling off of the company’s main assets. The losses of the national airline were put into perspective by the current Finance Minister Clyde Caruana in Parliament a few months ago when he pointed out that Air Malta has gone through €435 million over the past 15 years, or €29 million a year.

If that is not an obscene amount of money down the drain I don’t know what is. No private company would have been able to survive so long with losses of that scale. Rather than continuing to haemorrhage money, it would have had to declare bankruptcy long ago. The fact that it didn’t was purely because the state continued to prop it up, and tried to solve the problem called Air Malta by throwing even more money at it.

Ministers, Chairmen, CEOs and expensive consultants have come and gone, all offering a plethora of solutions, until finally the continued pumping of more state aid into the airline came to a halt this year after the European Commission put its foot down. No more state aid until the company reduces its workforce, which is overstaffed.

Of course, the crux of the problem, which both Mr Curmi and Minister Caruana have spoken openly about, is that the airline has always been used for decades by politicians from both parties to grant political favours to their constituents by “giving them a job” with Air Malta. This is common knowledge which is spoken about frankly, wherever you go. Some people, with that typically cynical Maltese sense of humour, even make jokes about which Minister was in charge when this or that person got their job, depending on which electoral district they were from - that is how widely ‘accepted’ this practice is. (Obviously, I am not referring to those who were employed through the proper channels and are suitably qualified).

For those who have only worked in the private sector, however, such a casual, blatant dishing out of jobs without any merit has always been a very sore point. Even worse has been the way that those who are made redundant are then given government jobs to cushion the blow. For example, after the pilots were sacked it was later revealed that Konrad Mizzi had signed an agreement promising any pilots who were let go a job with the public sector with the same pay until the end of 2022. On which planet is that kind of sweet deal offered to anyone who works with private enterprise?

As for those 400 employees who will be axed now, they are going to be able take up a ‘voluntary transfer scheme’ to work within the government sector. What this basically means is that whether they stay with Air Malta or not, their salaries will still be paid for by the taxpayer.

I do not want to sound uncaring about the families who will be affected, because losing one’s job is a terrible thing and can lead to extreme anxiety and panic. However, the stark contrast between the private and public sectors could not be more glaring in this respect. With the former, if your place of work makes you redundant you are on your own – good luck and good night.

As you face the prospect of no more income, you have to figure out what to do next by yourself, going back to the grind of submitting applications which are often not even acknowledged. You sometimes have to accept a job below your previous pay scale, or you might even have to switch careers altogether, or even accept a job which you absolutely hate, because the alternative is being unemployed, which is unthinkable. However, when you work with a state-owned company such as Air Malta, or as happened in the past with the Drydocks, there are always schemes which are immediately offered to you to give you a lifeline and help you stay on your feet.

In September 2008, for example, the government had offered lump sum settlements to the shipyard’s 1,627-strong workforce at a cost of €58 million. That money came out of our taxes. Those who did not accept the lump sum were offered the chance to be transferred to a government-owned company, Industrial Projects and Services Ltd.

Again, I realise that helping these workers out was preferable to having such a large number of people suddenly unemployed with all the ripple effects this can have on the country, but it also has to be pointed out that stuffing more workers into an already bloated public service cannot always be the answer either.

It is small wonder that when employers issue a call for applications, they can never find suitable candidates and are always asking where all the Maltese-speaking applicants are. You don’t have to look very far – from the looks of it, most of the country is going to end up with a ‘job mal-gvern’. The question is, how long can the country’s coffers continue to sustain all this, at a time when most businesses in the private sector simply cannot find enough staff to keep going?

Rather than just waving a government job at them, those losing their jobs should be helped to find alternative employment within the private sector, which as the Malta Employers’ Association has pointed out, is crying out for staff. Clyde Caruana’s experience as the former head of JobsPlus puts him in the ideal position to know what type of job training schemes are needed and what employers are looking for, while the MEA has even offered its help in redeploying workers in this way.

I know that with an election this year, politicians will still try to dangle that tantalising carrot of a secure job for life which for some people is preferable to the vagaries of normal market forces out there in the real world. Most will tell you that the temptation to dole out jobs in exchange for votes is almost a foregone conclusion.

But perhaps we finally have a finance minister with enough backbone to put a stop to this unethical, corrupt practice. He just needs to bite the bullet, as he has done with tax evasion, even though his no nonsense approach has drawn ire from some quarters.

As he said recently, “I am not here to be popular…I am here to do my work. If it is not good enough and I need to leave, so be it. I reason like this because it is not my career, it is part of my career, so I want to see that in my time as Minister of Finance, I start to see a change in culture.”