Air Malta’s restructuring | ‘Crucial that we get it right,’ says Finance Minister

Finance Minister Edward Scicluna warns that this is Air Malta’s only chance ‘to get it right’ as the state aid won’t happen again

Finance Minister Edward Scicluna
Finance Minister Edward Scicluna

Finance Minister Edward Scicluna has steered clear of discussing Air Malta’s financial situation, telling a public debate that, however, Air Malta must get it right.

The European Commission has allowed national airline Air Malta to receive a €52 million cash injection in state aid.

Air Malta’s financials may experience renewed turbulence as a €30 million in losses is being forecasted for March 2015, the year in which the airline should be gearing up for breakeven.

Both Air Malta and the Minister for Tourism have refused to confirm or deny the reports, with Edward Zammit Lewis dubbing the forecast as “a mere projection”. Reports of the substantial losses however succeed the resignation of Air Malta’s CEO, Louis Giordimaina, just eight months after taking the post at the helm of the national airline and the earlier resignation of Chief Financial Officer Clare Brown.

During a public discussion on Malta’s 10th anniversary since joining the European Union, the finance minister was asked by the GRTU’s Philip Fenech to give an indication of how Air Malta was faring and what would happen if the airline does not breakeven.

“It is the interest of every citizen, of the industry and mine that Air Malta reaches its targets…but your guess is as good as mine,” Scicluna replied.

Calling Air Malta’s restructuring process “an experiment”, the finance minister said Air Malta was allowed a one-time injection which will not happen again.

“It is very crucial that we get it right now because it [Air Malta] will not be allowed another chance [for state aid].”

In his opening remarks, Scicluna said the Eurozone economy was still reeling from the financial crisis, comparing the recovery period to the convalescence period of a person “who was hit by a truck”.

Scicluna reiterated that the Budget 2015 targeted those who were on social benefits, by encouraging them to join the workforce or start training.

He also criticised the media for “not realising” that for every “cent issued by the government, we expected two in return”.

“The free childcare centre initiative was a measure that would see taxpayers gaining back the money that was invested in order to make the measure work,” Scicluna said.

Scicluna said the government had to be vigilant on how social benefits are issued: “I remember doing the door-to-door meetings and see young men and women sitting all day long in front of a TV doing nothing. We want people to have a certain pride in themselves and work.

“We don’t want some youth to register himself on a garage address, pretending he was living on his own and receive benefits. This is not fair on the honest working people.”

Scicluna’s comments were echoed by a member of the audience, Mary Gaerty, President of the National Council of Women. Gaerty, owner of Green Skip Services Ltd, said that Maltese did not want to work.

“Our company employs 36 workers, 20 of which are foreigners for the simple reason that Maltese refuse to do the job,” she said.

The finance minister said the waste of medicine was another problem which had to be tackled, remarking that certain people “require an inventory” as they hoard medicine.

He admitted that any reform risked irking people but the government had to ensure that the gainers compensated the losers.

At one point, Scicluna appeared to suggest the opening of a night court for certain court cases, allowing people not to lose any hours from work to attend court sittings.

“Justice reform is not impossible and reforming the management of the justice system does not attack the independence of the judiciary.”

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