CAL FACES PETROTRIN-STYLE COLLAPSE

TAXPAYER-OWNED Caribbean Airlines Ltd. (CAL) is collapsing on the weight of maladministration, like Petrotrin, the fallen energy giant.

Five years after the lights went out at Petrotrin’s Pointe-a-Pierre refinery, the future of the national airline is endangered as a result of financial losses, demoralised staff, and health and safety concerns.

CAL, which was bailed out to the value of $2 billion during the Covid-19 epidemic, is not in sight of a financial turnaround despite sending home 600 of its 1,600 workers and shaving its spending.

The airline lost heavily in the aftermath of the medical crisis and is servicing loans to a consortium of local financial institutions.

Along with the recent pilot sick-out (which, according to CAL, cost $15 million), the state enterprise is dealing with a disgruntled workforce, with claims of inept management.

Worker morale is low, and there is speculation that more protests may be looming.

According to employees, there are hazardous working conditions and fears that safety standards could be compromised.

The airline’s management has been accused of poor decision-making, lack of transparency, and inadequate communications.

Employees allege that some senior and experienced pilots were among the workers who were sent home during the Covid-19 emergency.

Apart from the questionable termination of pilots, workers have a litany of “costly mistakes, missed opportunities, and shattered careers.”

Workers also claim there are attempts at union-busting, along with poor negotiating practice and “plain disregard for our professions.”

The 2016-2018 collective agreement with Trinidad and Tobago Airline Pilots’ Association (TTALPA) is still outstanding, and CAL is pleading inability to pay salary increases.

Pilots are also upset that 79 were retrenched during the Covid-19 period even after accepting a 57 per cent pay cut.

In his 2022-2023 national budget, Finance Minister Colm Imbert noted the previous $2 billion support and said it was for a three-year period.

There are indications that the Government would be hard-pressed to rescue the airline again.

CAL’s low-profile Chairman Shameer Ronnie Mohammed – whose family owns the Nutrimix flour and feed company – has been accused of weak policy-making.

But more criticism has been directed at CEO Garvin Medera for the overall state of administration, including worker dissatisfaction, loss of key employees, and dubious executive decisions.

A group of workers, in an unsigned letter, accused Medera and Roger Berkeley, Vice President of Human Resources, of running a “most toxic and repulsive management regime.”

Critical issues being faced by the national airline – especially disputed big-ticket business decisions – are similar to those that existed before Petrotrin was mothballed on November 30, 2018.

The energy company’s executive management, led by the favoured Malcolm Jones, caused a loss of some $3 billon in the collapsed World Gas-To-Liquids (WGTL) project.

There were 33 cost overruns.

Jones undertook the suspect venture in spite of repeated and strong advice from senior management officials about major risks, especially with the ill-equipped business partner.

The Kamla Persad-Bissessar Government took legal action against Jones and his executive team, but the litigation was quietly withdrawn by the administration of Dr. Keith Rowley.

In addition, the price tag for the gas optimisation plant skyrocketed from $2.45 billion to $12.6 billion.

The cost of the ultra-low sulphur diesel project zoomed from the budgeted $791 million to $2.89 billion.

Some $70 million was spent on an incomplete head office.

The company had a huge crisis with project management.

At the time of the closure, Imbert estimated Petrotrin’s debt burden at $12 billion and said the company was “tottering on the brink.”

CAL was launched in September 2006 as a successor to BWIA, which flew the skies for 66 continuous years.

BWIA was shut down after losses of more than $1 million a month, to add to a loan of $250 million given in July 2005 by the Government, which owned 97.2 per cent shareholding.

As with CAL today, BWIA had cut staff and reduced spending to stay in the air.

Unable to carry the debt-ridden airline anymore, the Government removed BWIA from the blue skies.

CAL’s financial situation is barely better and there is little prospect of a foreseeable improvement.

There are 55 wholly-owned state enterprises, with CAL and Petrotrin among the largest.

The shutdown of Petrotrin negatively impacted thousands of service providers.