Finance Minister: Air Malta demise is a result of bad management by all governments

Air Malta has been “used and abused” by both Nationalist and Labour governments over the years, Finance Minister Clyde Caruana said on Tuesday. 

“The airline was turned into a government department,” he told parliament.

Caruana wasted no time in emphasising that the airline's troubled history was a result of the political interference which led to its end. He insisted that if proper actions had been taken in the past, Air Malta might not be facing such dire circumstances today. 

He highlighted that multiple administrations had attempted to hide the problems in an effort not to lose public trust. “But as this went on, the airline continued to haemorrhage money.”

“As long as I serve as this airline's minister, I am committed to ensuring its profitability. I couldn't care less about how ugly I may appear while achieving that,” Caruana added.

Caruana cited examples, such as contracts signed in 2007/2008 which saddled the company with substantial retirement scheme obligations. He questioned the logic of signing such agreements and criticised the lack of foresight in dealing with them.

The finance minister also scrutinised the Labour government’s own financial decisions, pointing out that opening numerous destinations had also led to massive losses. 

"Nothing better than being objective,” Caruana insisted, “those are the numbers. The numbers don't lie."

Tabling the deal reached between the European Union and Air Malta, Caruana said it bothered him that the Opposition debated with bold claims driven by political considerations, but no one within the PN asked to see such a deal.

"No one asked me!” he screamed when PN MP Ivan Castillo protested. “You only think about the votes you could be winning.” 

In response to an attempt for a point of order by Castillo, Caruana emphasised that the airline's ongoing losses were unsustainable.

He questioned the feasibility of Air Malta's operations without proper assets, highlighting the new company's ownership of three planes.

“The airline's ongoing losses were unsustainable. This is the best decision up front, and I say this with the biggest responsibility," he said.

Recalling the several discussions he held with unions, Caruana said it was in the midst of one of these discussions, when a union leader said, “will we still be getting the free airline tickets?”

“How can you ensure profitability?” Caruana remarked, “when everyone wants free tickets.” 

He concluded his speech by reassuring the public that there was no need for panic or alarm and that individuals were responsible for consumer protection and refunds starting November 1.

Mario de Marco says the prime minister's description of airline closure as 'historic' is an insult to the taxpayer 

Tourism spokesperson Mario de Marco questioned the potential success of the new national airline, considering “it will be run by the same people who failed Air Malta.”

De Marco expressed concerns about the lack of confidence in the future, primarily arising from the government's insufficient communication and information sharing on this matter.

He emphasised that everyone desired the best for the country, including a reliable flag carrier. Therefore, it appeared "surreal" for him, when on Monday the prime minister had described the closure of Air Malta and the establishment of the new airline as "a historic day."

“Describing Monday as a "historic day" is an insult to both current and former Air Malta employees,” de Marco added “as well as to the tourism and financial services sector, which heavily relied on its connectivity.”

The PN MP highlighted that this declaration also insulted Maltese taxpayers, who would ultimately bear the burden of settling Air Malta's outstanding debts.

De Marco pointed out the irony, citing former Minister Evarist Bartolo's remark, that "50 years after the establishment of Air Malta, the country was witnessing its funeral." 

"Air Malta was not brought down by new regulations but by local political issues," he added.

While acknowledging that various administrations could have managed the airline more effectively, De Marco argued that in 2012, the Gonzi government had successfully negotiated a restructuring plan aimed at saving Air Malta and restoring its profitability.

He noted that initially, progress seemed promising, as confirmed by various statements from Air Malta itself over the years. Even as recently as January 2020, Minister Silvio Schembri had expressed optimism about the airline's recovery.

"What happened during then? Was Schembri lying? Wa he dishonest, like his predecessors?"