COPE tells SriLankan Airlines to submit business plan within a month

Committee on Public Enterprises (COPE) Chairman MP Charitha Herath yesterday directed SriLankan Airlines Chairman Ashok Pathirage to submit a complete business plan within a month to make the National Carrier profitable.

The Committee also recommended to the Secretary to the Ministry of Tourism to study the current situation and submit a report at Ministerial level within a month.

The Committee further recommended that an expert committee be appointed to conduct a comprehensive study and submit a report as early as possible.

It was revealed at the COPE meeting that the loss of SriLankan Airlines Ltd. as of 31 March 2021 from the day it was taken over by the Government was Rs. 372,015 million.

The total loss of the company following taxes in the year 2020/21 was Rs. 45,674 million and the operating loss has also increased, COPE Chairman Herath said.

This was due to the impact of the prevailing COVID-19 situation, as well as rising costs of jet fuel, aircraft operating leasing costs and other operating leasing costs.

The Committee observed that the adverse capital conditions of the company had reached a critical level by 31 March 2021 and was therefore facing a problematic situation regarding its operations without the assistance of the Treasury.

The Committee observed that the Cabinet had approved for an additional investment of $ 500 million by 2020, of which $ 240 million had already been released to the company. The Committee also paid special attention to the manner in which the money was used.

The Committee also observed that a senior management officer serving at SriLankan Airlines as of 31 March 2021 receives a monthly salary of Rs. 3.1 million; 82 pilots receive a monthly salary of over Rs. 2 million; and another 142 pilots, 12 aeronautical engineers, nine engineering managers and three top management officers of SriLankan Airlines receive a monthly salary of between Rs. 1 million and Rs. 2 million.

The Chairman also pointed out the need to maintain this service as a national airline.

The Committee also revealed that SriLankan Airlines’ daily loss was Rs. 84 million and that a systematic plan was needed to make the company profitable.

The Committee commended SriLankan Airlines for reducing its cost by $ 66.9 million in 2019/20 and 2020/21.

Minister Mahinda Amaraweera, State Ministers Ajith Nivard Cabraal, D.V. Chanaka and Indika Anuruddha, MPs Rauff Hakeem, Patali Champika Ranawaka, Eran Wickramaratne, Harsha de Silva, S.M. Marikkar, Jagath Pushpa Kumara, Jayantha Samaraweera, Premnath C. Dolawatta, S.M. Marikkar and S. Rasamanikkam were present at this meeting.

(Source: Daily FT)