In doldrums: Flag carrier’s management dispels corruption allegations
Engulfed in conspiracies, the national carrier has fallen victim to major financial and operational crisis. The Pakistan International Airlines (PIA) management however, dispelled on Saturday all allegations of corruption and mismanagement, according to the airline’s spokesperson.
The federal government’s approval of the five-year business plan to turn the corporation around is a clear indication of the current management’s integrity and professional competence, the spokesperson said. The management is determined, to not only root out corruption but also, to turn the airline around keeping in view “correct business practices and official rules” of business to keep corrupt elements from finding an escape route.
The PIA management pointed out that the national carrier is coming under constant attack by those who have vested interests, and despite that, the PIA management continues to make efforts by presenting itself and explaining the situation not only to the elected organs of the state and the media, but also to representatives of the PIA employees.
Last week, the PIA management invited Palpa and representatives from various other associations, and after discussions with them, the PIA managing director decided to form an advisory committee in order to prevent corruption within the organisation.
The PIA management also asked them to point out corruption cases in the organisation so they could take proper legal action against anyone held responsible. However, the associations present during the discussion advised the management to defer the committee till the new elections to allow freshly-elected representatives to be part of the committee.
Regarding the two leased Boeing 747 aircraft, the spokesperson said they were acquired to supplement the fleet during the national carrier’s Hajj operations to ensure regular scheduled flights.
The two aircraft will cost $7.1 million. Although, so far, PIA has already earned through $6.5 million in revenue through the aircraft, and is expected to earn another$6.5 million, taking its total revenue up to $13 million till the finalisation of the lease period – which is December 15, 2011 for both planes.
PIA issued an international tender for engaging a fuel hedging consultant of international repute, however, only one person from Canada responded to the advertisement. PIA invited the respondent for a presentation on fuel hedging, to which the Canadian replied that he was preoccupied, the spokesperson concluded.
Published in The Express Tribune, November 20th, 2011.
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PIA lost Rs 8 billion in 3rd quater that is from July to September 2011 (reference PIA website). This means that the airline is losing Rs 2.67 billion per month, Rs 88 million per day, Rs 3.6 million per hour, Rs 150,000 per minute or Rs 6,250 per second.
With every quater its performance turns out to be worse than the previous one. For example in the first quater of the year the airline lost Rs. 4.7 billion, followed by a loss of about Rs 6 billion in the 2nd quater and Rs 8 billion in the 3rd quater of the year. Follwing this trend its losses in the last quarter should exceed Rs 10 billion. Hence the total losses for the year 2011 could reach Rs 30 billion.
I wish the general public could know and understand the damage being done by this organization to the poorest of the poor people of this country. People who can not read and write and languish in poverty and ignorance. People who are dying of hunger and disease.
All government corporations ought to privatised sooner than later to minimize the damage.
I recommend the MD to appoint existing GM Finance as the point person to solicit quotes on fuel derivatives from the major banks in New York and London on the day they intend to purchase a hedge. Then the quotes could be compared and the least expensive hedge could be bought. Quotes will fluctuate based on Aviation Fuel supplies in the market for that particular date and time. Its a moving index. I say this because I did fuel hedges for the US Aviation Industry on Wall Street. There is no point in hiring a dedicated consultant, unless this is a political appointment, in which case whatever any professional says is not worth two cents. PIA management should learn to save money by using existing resources and not by adding Head Count.