Air Malta | Reform needs to provide final solution to last decades - Muscat

Speaking in parliament during a debate to approve the government’s plan to invest 52 million in Air Malta as emergency funds while a restructuring plan is drawn up over the coming six months, Muscat affirmed how it is in the national interest that its national airline finds itself on solid ground.

Remarking that Finance Minister Tonio Fenech was speaking as if he (and his government) only recently stepped into office and not fifteen years ago, Muscat said that the opposition’s cooperation in the discussions and restructuring process should not be taken for granted that it said its piece on the matter.

“There are many arguments to be made,” Muscat said, “ but this is not the time to drag them up.” He affirmed that the opposition still had a lot left to say on the issue, and on where exactly Air Malta took a bad turn.

Muscat however said that “in the coming weeks and months, depending on how the discussions develop, some things be mentioned in the interest of public interest.” The potentially controversial statement provoked little reaction among the few MPs and backbenchers in attendance.

Muscat affirmed that throughout the restructurisation process, “Air Malta cannot be considered like any other company” due to its position as a Malta’s sole link to the mainland. “Air Malta must, and will, survive, because the country needs it to.”

Muscat added that he believes that this would be so because the necessary commitment to see this done is present.

However Muscat pointed out that the carrier’s long term survival, especially in an overarching EU context, will go beyond of the rescue and restructuring plan, “but depends on government recognising and using tools that so far have not been used enough.”

Muscat also urged government not to forget the past successes of the airline- how without it, “tourism would have developed along a far harder route and would have probably held the country back were it not for a decision taken many years ago that was nevertheless highly contested in certain quarters.”

Muscat affirmed that Air Malta had “never taken subsidies from taxpayers – but was always an entityt that contributed not only in terms of accessibilities, but also by means of taxes it paid, giving its property to the state, and its greatest legacy – the education of workers.”

Muscat said that through education, Air Malta “created a sector of workers previously undreamed of in its heyday- such as pilots and engineers. Today we might take it for granted but at the time it opened up new horizons for at least two generations of Maltese and Gozitans.”

Muscat also pointed out how there were “decisions in the past that not only at times hindered, but sometimes also obstructed the progress of the carrier.” Despite affirming that these were discussions for another time, Muscat said that these “decisions cannot be deleted’ as if they never happened.”

Reacting to the threat posed by low cost carriers (LCCs) Muscat said how this ‘balancing act’ would always be present. He contested the position that it was LCCs who brought Air Malta to its knees, “but rather it was due to the strategies that the government implemented when it opened up the country to LCCs.”

Nevertheless, Muscat conceded that government could not afford to close up in upon itself and live inside a bubble where LCCs were not recognised. “But there are strategies ands strategies,” he said.

“It’s a question of balance. While tour operators and LCCs are helped, why can’t Air Malta also be similarly helped?”

Muscat said that the challenge that lies before the state is now is that for the government to learn to distinguish between its dual roles and take the best decision in both roles of policy maker and of shareholder, even in situations “where the priorities might sometimes conflict.”

Throughout the debate, Muscat noted that “workers were not mentioned much,” adding that he wished that the debate does not leave them out.

“Air Malta’s workers have carried their fair share of the burden and to this day perform an excellent job. In the memorandum of understanding in 2004, they carried their weight, many of them with a wage freeze,” he said.

“However, others, and people in higher positions, went on with business as usual and with performance bonuses to boot,” Muscat added. This, he said, created a conflicting situation where there was confusion and even resentment.

Muscat critised the manner in which the government was approaching certain aspects of the restructuring system, hitting out at how the government is bringing in foreign consultants to do work that should have been done by Air Malta’s management all along.

“Does is take a consultant to come in tell you that you should carry out a study on which routes are the most profitable?” Muscat asked, pointing out that very basic operational approaches were being ignored, despite certain individuals being paid handsomely for managing the company.

Muscat emphasised that the role of the opposition in the upcoming reform talks would be to ensure that the government keeps its word with the workers and that it ensure that this static asset remains permanently in hands of the state.

“This is the time for lasting reform,” Muscat said. “After Air Malta was allowed to reach the brink, the least we owe to the people is that the decisions taken today are lasting and effective.”