Air Malta’s costly agreement with pilots was PN’s brainchild, Finance Minister lashes out

Government will have to spend €100 million to buy out expensive legacy clauses in Air Malta’s collective agreement with pilots, Clyde Caruana says

Finance Minister Clyde Caruana
Finance Minister Clyde Caruana

Taxpayers will have to fork out €100 million to end legacy agreements Air Malta has with pilots and cabin crew signed by past Nationalist administrations, Clyde Caruana said.

The Finance Minister tabled in parliament collective agreements signed before 2013, which included the obligation that the airline should continue to pay pilots a salary until pensionable age even after they leave the airline.

The clause stipulates that pilots who retire from the airline at 55 after a number of years in service, will continue to receive two-thirds of their salary until they reach the national pensionable age.

Caruana said in parliament on Monday during the debate on the finance ministry’s estimates that this clause was costing the airline €4 million per year and had been a burden for the past decade.

The Finance Minister said these expensive clauses, which contributed to the airline’s financial difficulties, had been negotiated and agreed upon by successive Nationalist Party administrations.

“I will now end these agreements but in doing so taxpayers will have to fork out €100 million to do this because these obligations have to be honoured and we will buy them out,” Caruana said of ongoing negotiations with pilots.

Government is implementing a restructuring process at the national airline to ensure it remains financially viable.