PIA finalises plan to lay off half of its employees

Will also enlarge its fleet with inclusion of 16 new aircraft by 2022

Waqas Ahmed December 16, 2020


The administration of the Pakistan International Airlines (PIA) has finalized the plan for restructuring of the national flag carrier and the plan includes reducing the number of the PIA employees by almost half – from the current 12,900 employees to 7,500 employees.

According to the plan, the PIA departments will be divided into core and non-core activities. The core activities will comprise administrative departments including finance, CNC, security and human resources. The non-core activities will include engineering and kitchen etc.

The structuring plan aims at reducing the number of employees from 12,900 to 7,500 in the first phase. At present the PIA has 10,500 regular employees and 2,400 employees on daily wages. The number of employees will be further reduced to 6,000 or 5,600 by 2021.

After this massive reduction in employees, the airline will come close to breaking even. The plan also includes inclusion of 16 new aircraft by 2022. There will be 130 employees for each of the aircraft.

At present the PIA fleet comprises 29 airplanes and after induction of 16 more aircraft it will have 45 aircraft in 2022. In order to implement this restructuring plan, the government has already formed a four-member committee headed by Adviser to the Prime Minister Dr Ishrat Hussain.

The committee also includes secretary finance, secretary aviation and secretary privatization. The committee will also review measures to make the airline more autonomous.

According to sources, the PIA’s total assets are worth Rs107 billion while it owes Rs470 billion in loans. The committee will also consider declaring all loan amounts over and above its assets public debt.

PIA Chief Executive Officer (CEO) Air Marshal Arshad Malik on December 5 claimed that the national flag carrier would become a profitable entity in the next few years.

“We are trying to reduce the PIA’s losses with the cooperation of the private sector,” he had said while addressing a ceremony where an agreement was signed between the airline and a private bank.

The PIA CEO had pointed out that the European Union Air Safety Agency (EASA) had expressed its satisfaction over the measures taken by the airline in connection with its safety management system.

“We are facing issues because of the coronavirus pandemic but the PIA will soon reach new heights. The PIA has reduced fares to provide relief to the people despite facing challenges because of Covid-19.”

Last month, the government had approved a plan that seeks to lay off over 3,800 regular and contractual employees of the PIA to cut annual losses by Rs4.2 billion.

The Economic Coordination Committee (ECC) of the Cabinet had approved a Rs12.87 billion Voluntary Separation Scheme (VSS) for the PIA employees to be paid in two-and-a-half year time.

According to the Aviation Division, the laying off of 3,500 employees would result in annual savings of Rs4.2 billion and the government will recover the Rs12.9 billion VSS cost within two-and-a-half years.

During his visit to the Lahore Chamber of Commerce and Industries last month, the PIA CEO had said the financial restructuring of the national carrier was well on its way and would be finalised soon. “We do have a few options to settle the mounting debt issue of PIA,” Malik had said.

“One of the options is to issue investment bonds; the other is debt-equity swap.  The third option we have is that the government can take some of PIA’s assets against the loans to clear our balance sheet, which is already guaranteed by the government,” he had added.


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