ISLAMABAD – The National Assembly Standing Committee on Defence was told Monday that the Pakistan International Airlines (PIA) needs Rs 58 billion bailout package which included Rs 45 billion for debt services while Rs 13 billion for immediate liabilities payment. PIA’s Director Finance Faisal Malik and Secretary Defense Lieutenant General (Retd) Syed Athar Ali were briefing the standing committee.
Athar Ali told the committee that the government had decided not to sell two PIA owned hotels, Roosevelt Hotel in New York and Hotel Scribe in Paris, despite Finance Minister Hafeez Shaikh’s stance that the government was seeking to sell the said hotels on priority basis.
Earlier, the sub-committee of the standing committee on PIA submitted its report recommending that the PIA should be given equity injection, despite incurring heavy losses, to turn it into a profitable organisation instead of privatising it.
The committee also recommended that the Ministry of Defense should support and renew the guarantee against already approved loans. The committee said that the Finance Division should provide support in restructuring of short-term loans into long-term loans worth Rs 7.55 billion through National Bank of Pakistan on soft terms and there should be regular evaluation of the PIA as well on quarterly basis. The committee said that the financial crisis of the airline had increased because of certain inefficient managing directors and all of them must be held accountable for financial irregularities.
The committee also recommended that all kinds of recruitments should be banned in the PIA and salaries of the officials frozen at the current level for a certain period to curtail the expenses. The committee also suggested that the PIA’s kitchen system should be leased out. The sub-committee observed that the PIA owed Rs 145 billion by 31-12-2009 to different financial institutions, which included fleet and non-fleet loans. It also pointed out that main obstacle for the PIA in re-scheduling of loans was its credibility as it failed to deliver despite getting financial assistance four times in last ten years.
Later, the standing committee expressed serious concerns that a large number of teachers teaching in the Garrison and Cantonment Schools for the last 15 or 20 years had not been regularised. The Director Garrison and Cantonment Schools said that there was a system whereby the teachers on permanent basis were hired. The committee, however, stressed their regularisation. The Secretary Defense at that point said that his ministry had sent a summary in this regard twice to the prime minister but it was returned. He said he would resend the summary with the committee’s endorsement this time round.
