October 18, 2018 / 7:51 AM / a month ago

Pakistan's PIA delays salaries as monthly losses hit $15 mln -paper

KARACHI, Pakistan, Oct 18 (Reuters) - Troubled national carrier Pakistan International Airlines (PIA) is suffering operational losses of 2 billion rupees ($15 million) each month and has had trouble paying employees this month, the Dawn newspaper said on Thursday.

The losses were aggravated by a fuel price hike and a depreciation of more than 20 percent in the rupee currency within a year, Aviation Secretary Mohammad Saqib Aziz told a Senate committee on Wednesday, it added.

Hemorrhaging money and losing market share to Gulf-based rivals such as Etihad and Emirates, PIA has suffered management turmoil in recent years and a 2016 plane crash that led to 47 deaths.

The operational losses were in addition to the airline’s liabilities of 400 billion rupees, including bank loans, Aziz added.

The new government of Prime Minister Imran Khan last week appointed a serving vice marshal of the country’s air force as airline chairman after the Supreme Court ordered the removal of the previous chairman.

Also last week, the Pakistan Stock Exchange put PIA on warning for not submitting its audit report and convening annual general meetings.

One cause of the financial woes was overstaffing, Aziz said, adding that PIA has 13,500 regular employees and some 3,500 of daily wages, for about 450 workers for each aircraft.

Five of PIA’s fleet of 33 aircraft have been grounded for maintenance, he added.

A PIA spokesman on Thursday said October staff salaries were paid after a delay because of financial constraints.

“Salaries were delayed this month, more than half of the employees got salaries by the 6th or 7th,” the spokesman told Reuters. “The senior staff have also been paid,”

The previous government’s attempt to privatise the national carrier stalled in 2016 after staff protests disrupted operations and parliament passed a law that effectively made privatisation impossible. (Reporting by Syed Raza Hassan; Editing by Kay Johnson and Clarence Fernandez)

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