Money to save MAS can be used to benefit the public, says veteran journo
The latest revamp to revive troubled Malaysia Airlines (MAS) has been likened to a bottomless pit, said a former journalist, pointing out that the RM1.6 billion payout to retrench 6,000 staff can be used for a host of activities to benefit the public.
While newspapers had hailed the turnaround plan announced by state sovereign fund Khazanah Nasional Berhad yesterday, Datuk A. Kadir Jasin (pic) said the proposed restructuring and retrenchment cost for 30% of the national carrier's 20,000 employees is not new and cannot be considered a world-class proposal.
He said when the flag carrier was privatised between 1994 and 2002, there were plans to reduce its staff by 5,000 to 8,000 but this was rejected by Putrajaya.
"Just retrenching staff is going to cost RM1.6 billion. What about other costs? The RM1.6 billion is nearly enough to upgrade MUDA water irrigation system in Kedah and Perlis which covers more than 100,000 households or other public facilities which benefit the people.
"Saving MAS numerous times is akin to filling up bottomless wells. It is a bottomless pit," the former editor-in-chief of New Straits Times wrote on his blog.
MAS's majority shareholder Khazanah had unveiled a 12-point plan which it hopes to turn the flag carrier around and record profitability earliest by 2017.
The plan will see the setting up of a new company to house the flag carrier once it completes it delisting exercise by the end of this year, rationalise routes, renegotiate current contracts, cut 30% of the 20,000-strong workforce and move its operations from Subang to Kuala Lumpur International Airport (KLIA).
The move to revive MAS will see a capital injection of RM6 billion, which both Prime Minister Datuk Seri Najib Razak and majority shareholder Khazanah had denied as "bailout".
Of the total RM6 billion, RM1.4 billion will be spent to delist MAS, which is expected to be completed by end of this year, after Khazanah's announcement early this month that it plan to buy out shares it does not own at 27 sen for each MAS share.
Another RM1.6 billion will be spent on restructuring and retrenchment costs, while RM3 billion will be injected progressively into the new company.
Kadir said the move makes MAS to be 100% government owned and since it is theoretically "bankrupt", more radical moves had to be taken to save the national carrier.
He reiterated his previous stand to save the airline, saying that it should either be liquidated, sold to private companies, privatised without burdening the country's finances, hiring proven international management and eradicate adverse government intervention.
The carrier had been in trouble for years and had undergone three restructuring exercises since 2007 which had failed to yield any results due to a bloated workforce, changing market demand, stiff competition and high overhead costs.
Over the last ten years, Khazanah had pumped RM7 billion into the ailing airline, with RM5.7 billion alone in the last five years through three rights issues.
MAS announced its second quarter results two days ago which recorded a net loss of RM307 million, which brings the total loss to RM750 million for the first six months of this year.
MAS ailing condition was further affected by two major aviation disasters this year. Flight MH370 from Kuala Lumpur to Beijing vanished in March with 239 people on board, while flight MH17 from Amsterdam was shot down over Ukrainian air space on July 17, killing all 298 people on board. – August 30, 2014.
