Probe into what went wrong with airlines

EUROCYPRIA workers were told yesterday they will be paid next Thursday for any outstanding hours worked before the airline went bankrupt.
Speaking at the House, Finance Minister Charilaos Stavrakis said their compensation packages would be estimated with the same formula as that used for state carrier Cyprus Airways (CY) back in 2004, when the airline was restructured. The only difference is, lower-earning employees will receive more and higher-ranking less.
Stavrakis also said the government will launch an investigation into what went wrong with the state’s airlines in a bid to bring those responsible to justice.
There wasn’t much to encourage Eurocypria staff hoping to make a sideways move to CY. “First of all we must all ensure that CY will survive. This will mean drastic reductions in staff and the way it operates; this includes new terms of employment and less benefits,” Stavrakis said.
Once all that has been taken into account, he added, Eurocypria workers will take first priority in any further employments.
Asked how the CY staff had taken the news, Stavrakis added: “Judging by initial reactions, I think the workers may not have completely got the message.”
“If we are honest with ourselves, the problems have been transferred to Cyprus Airways,” said Stavrakis. “But Cyprus Airways has a future and prospects, provided that the management and workers agree on a realistic restructuring plan, which will reduce the millions in losses to zero.”
The minister admitted it wouldn’t be easy, considering most of CY’s expenses are fixed, such as plane rentals and fuel. “The only thing that can be changed is increasing the productivity of the staff in a way that would increase income.”
Meanwhile, the Finance Ministry has suggested to the President to launch an in-depth investigation into the bad dealings that have taken place in the past 15 years in the state’s airlines.
The minister said years of mistakes and bad decisions had led the state’s airlines to where they are today. One example, he added, was the creation of CY subsidiary airline HellasJet in 2004, which he said lost the state over €70 million.
Stavrakis reasoned that if Eurocypria and CY had that money now, the situation would be very different, and he attributed the costly mistake to the lack of sufficient surveys and planning from the government at the time.
“The investigation will also examine the methods used by various governments and CY Boards to rent planes, so we can assure Cypriots that all procedures were followed transparently,” said Stavrakis. “We are optimistic that the truth will shine through and very useful information will emerge,” he added.
Asked to comment on claims made during the joint parliamentary session between the House Watchdog, Finance and European Affairs Committees that previous CY chairmen and board members – as well as MPs – had applied pressure to have their friends, relatives or acquaintances employed in the airline, Stavrakis said: “the constant arrangements for acquaintances of all the previous governments to be employed at CY has intensified the problem, we can’t deny that”.
Watchdog Committee Chairman, DISY’s George Georgiou, called for an independent investigation by the Auditor-general into what happened at Eurocypria. Specifically, he explained that his committee wanted to know the exact reasons behind the government’s decision to mislead MPs into approving €35 million to boost Eurocypria in February.