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The Air Jamaica screw-up
Columns
Howard Chin  
February 16, 2010

The Air Jamaica screw-up

‘THERE’S been a lot of talk recently about Air Jamaica being sold to the Trinidadians, who, it is said, are really reluctant to take this on, having been hit like everyone else by the global recession. If the Trinidadian government actually buys Air Jamaica, it looks like they would be minus a lot of votes at the next elections.

A lot of Jamaicans are as mad as hell about the way the sale is being run and about the way the Jamaican government is acting. Prime Minister Bruce Golding said a few days ago that the government might have to sell the airline minus the mountain of debt. After all this, the government has been from last year desperately trying to unload the only two aircraft that Air Jamaica actually owns, at a time when a whole pile of airlines are downsizing or going out of business, and selling a ton load of aeroplanes or putting them into storage in the desert. The government must be nuts! No way are they going to get their asking price!

Then to top it off, there’s the hundreds of millions of US dollars the government has to cough up to pay the redundancy payments to the then ex-workers.

Basically, we the Jamaican public would have to foot the debt and the redundancy payment, then end up with Caribbean Airlines flying to places we might not like.

This is a big problem! It requires some “out of the box” thinking. So let’s see what’s been in the news recently.

We see the UK Privy Council’s final, un-appealable ruling that the current government must pay Mr Ezroy Millwood’s transport company $1.85b + interest for high-handed, screwed-up handling of the transport system by the previous government. Basically, that means, we pay. Mind you, the chance of Mr Millwood getting the cash in his hand in a year or two is about the chance of a snowball in hell. Most likely, the government would like to say, “How about us paying you a few million dollars per year for the next 30 years?”

What else?

We see the current government may be doing a super-duper, high-handed (almost Finsac-class) job with Air Jamaica. We must be mushrooms; keep us in the dark and feed us crap. Remember, the national airline is owned by the government. That’s supposed to be us, not them. I tried, with the assistance of Jamaicans for Justice, through the Access to Information Act starting back in September 2008 (Ministry of Finance Reference # 626/019, Acc # 230) to find out some pretty basic stuff; like, “Detailed income and expenditure statements of operations of Air Jamaica from 2006 to the level of location (gateways) job titles, cost of accommodation by city, fines incurred, etc.”

To date, this has not been forthcoming. I was offered the 2006 financial statements, which I bought for $320 (receipt # NR6103107). Ha! Ha! Pretty useless.

Now, if Air Jamaica was being run properly, monthly income and expenditure statements by gateway would be readily at hand for planning the operations of an airline. We hear that Mr Bruce Nobles has been making the airline profitable.

Then why dump it? Dump it now, under the conditions as we hear, and we’re guaranteed a monstrous bill and little to show for it. A profitable airline based here would give the government a nice source of taxes.

I see that Air Jamaica sponsors a jazz festival and I suppose, a number of other tourism-related things. Why? Sponsorship is a flow of money out of the company. If these are profitable ventures, as people say, why wasn’t it on a profit-sharing basis, or at least, Air Jamaica fronting some money for the venture and getting back at minimum what they put in? This should have been a policy. Up front, and get back. At a profit would be nice, instead of bleeding money.

Many politicians, I hear, got to ride for free. My opinion is that no politician should ever have been given a free seat, and if they buy tickets to fly, it should be only coach. If an uppity politician wants to go first-class he or she had better pay for the upgrade out of pocket. Not us. The prime minister should set the example and go coach only, and get “jooked” by elbows like everybody else. Getting an earful from a fellow passenger might be informative too. I have seen it reported in the press that government officials go first class. Nice eh?

What more?

The IMF of course! The IMF must think they’re talking to the walking dead. They surely believe that Jamaica is bankrupt, but out of politeness must pretend we’re not. We owe money till our descendants for generations to come will be bankrupt.

What on earth could we do to extricate ourselves from this pit the politicians have put us in, and are even now digging it deeper and squandering any goodwill we ever had for them? I think we are stuck with the Air Jamaica debt and the redundancy payments to staff anyway, but what next?

Perhaps we should say:The Privy Council ruling + The Air Jamaica problem + The IMF = What?

We owe Mr Millwood et al a couple of billion-plus dollars, thanks to the politicians. Mr Millwood is in the transport business. Most Jamaicans don’t like the idea of selling Air Jamaica to the Trinidadians and really can’t see what they might want to do with it – anything that we might like. The current crop of politicians seems dead set on doing what they like regardless of what we think. (Talk about squandering the goodwill we had for them.) They won’t even look at the pilots’ association (JALPA) bid. They said so, in our faces. The pilots’ association seems a little short of cash. I’m sure the IMF wouldn’t mind seeing the big chunk of money that is Mr Millwood’s Privy Council award vanish off the debt of the country, and see Air Jamaica vanish off the list of loss-making things owned by the government.

So, why not make everybody happy?

Millwood, realising the snowball’s chance in hell of being immediately paid the Privy Council award, and being in the transport business, may be seeing an investment opportunity, invests in Air Jamaica with the pilots’ association by saying, “Give me a part of Air Jamaica’s value (at realistic current prices of course, not like the selling prices for the two aeroplanes they’re hallucinating about) in lieu of the government coughing up the couple billion dollars (which they, meaning us, don’t have) for the Privy Council’s award, and we’ll call it quits.” The pilots’ association (JALPA), who seem to have the idea that they can run Air Jamaica at a profit get a chance to put up or shut up. The IMF sees, with glee, Mr Millwood’s award vanish off the public debt, and Air Jamaica vanishes off the government’s loss-making asset list. The current set of politicians gets our goodwill back (and they hope, our votes too, next time), and we get to fly our “little piece of Jamaica” with our tons of luggage the other airlines won’t let us carry.

Who says we can’t all be happy?

Howard Chin is a professional engineer (mechanical) and a member of the Jamaica Institution of Engineers.

hmc14@cwjamaica.com

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