PIA raises employees’ salary by 45 percent

The Ministry of Defence and the Pakistan International Airline (PIA) management have approved 45 percent salary raise for airline’s employees, increasing the burden on PIA’s tight budget, Pakistan Today has learnt.
Sources said that the raise only required a nod from the directors and had been approved by the ministry. The non-officer cadre CBA group 1 to 4 employees will get the benefit effective from January 1, 2012, while pilots, aircraft engineers and flight engineers will get it effective from January 1, 2013, sources said, adding that officers in group 5 and above were expected to get a 30 to 35 percent raise.
The decision has shocked many experts who said that it did not make sense as the national carrier was already cash-strapped. According to details, the total loss of the airline until the third quarter (September) of 2012 was Rs 141.3 billion, while its total liabilities exceed its total assets by Rs 120 billion.
According to a report, the PIA has already been declared for having the highest employee-to-aircraft ratio in the world, while the management recently hired 3,000 more employees.
The revenue projections and actual receipts of previous few years clearly show a constant decline in projected and corresponding receipts. The projected revenue target in 2011 was Rs 122 billion, while only Rs 116 billion was achieved. In 2012, the revenue targets were set at Rs 116 billion, while actual revenue receipts were Rs 98 billion. In 2013 the revenue targets have fallen to Rs 99 billion. Sources further revealed that 65 percent of the PIA’s revenues were generated in hard currency and domestic fares had been raised in accordance with the rupee devaluation, and hence the projected revenue targets should have been raised this year. However, only 28 of the 42 aircrafts are working which necessarily means that the targets could not be achieved.
“Although if you compare this with South West Airline in the US, which has 46,000 employees for a fleet of 690 aircrafts, the PIA has more than 22,000 employees excluding contract and daily wagers,” the source said, adding that the major reason for the constant loss other than surplus staff was the higher administration costs of the PIA. The national flag carrier also gave traffic rights to other airlines in violation of all bilateral agreements.
General Manager (Public Affairs) Sultan Hassan told Pakistan Today that he was not aware of any increase in wages and would have to confirm.