Fresh operating changes for new LIAT

The Antigua and Barbuda government says every territory to which the cash-strapped regional airline LIAT flies will be asked to purchase shares in the new company as efforts continue to revitalise the embattled airline.

A statement issued following the weekly Cabinet meeting, noted that three officials from the LIAT’s administrative office held discussions with ministers on the future role and expansion plans for the airline.

“In the proposed new LIAT, the salaries, wages and other emoluments will take up a smaller part of its cost of operations. Currently three aircraft are being utilized, as opposed to 10 aircraft before the collapse of LIAT,” the statement noted.

It said that the schedule plan for the new LIAT is intended to reflect the commercial needs and fulfillment of the territories and that “any destination requiring more flights than has been deemed necessary, would make a special payment to realize its ambition.

“A minimum revenue guarantee (MRG) would be applied in order to determine what that cost would be. Every territory to which LIAT flies will be asked to purchase shares, so that the burdens and the benefits can be equitably shared.”

The statement said that the revenue earned by LIAT over these past 20 months “shows a small operating profit”.

The airline entered into court-appointed administration in July last year after a High Court  judge granted a petition for the airline’s reorganisation. The Guyana-born chairman of BDO Antigua and Barbuda, Cleveland Seaforth, was appointed LIAT’s administrator for the duration of proceedings.

The airline is owned by the governments of Antigua and Barbuda, Barbados, Dominica and St Vincent and the Grenadines (SVG). Antigua and Barbuda Prime Minister Gaston Browne said previously that a decision had been taken that would allow Barbados and SVG to turn over their shares in LIAT to St. John’s for one EC dollar (One EC dollar=US$0.37 cents) .

Last year, St. John’s had put the cost of restructuring LIAT at EC$108 million of which 50 per cent will come from the Antiguan government with the remainder expected to come via other shareholder governments or even private investors.

Earlier this year, Prime Minister Browne appealed to Caribbean trade unions to re-think their positions regarding the latest offer made to laid-off workers of the airline.

The Antigua and Barbuda government said it was providing $2 million dollars “to meet partial satisfaction of the cash component of the compassionate pay-out” to former local employees of the regional airline.

Late last month, the Leeward Islands Airlines Pilots Association (LIALPA) said that terminated workers have been on the breadline since April 2020 and are in dire straits.

The pilots said they hoped the shareholder governments would emulate the “commendable responsible leadership” of the St. Lucia Prime Minister Phillip J. Pierre, who announced that his administration would be honouring the debt of the St Lucian workers of LIAT.

Meanwhile, Antigua’s Information Minister Melford Nicholas is defending the policy to seek financial assistance from countries wanting LIAT’s services.

“In the past, many states would have required and demanded certain flight schedules that made it uneconomic. I think, in this new arrangement, they will be proposing a minimal number of flight operations.

“And where member states would want to go beyond that, then they will be asked to supplement that operation with minimum rates guaranteed – much like the North American carriers would have done in the Caribbean,” Nicholas told reporters in Antigua.

“I think, based on those discussions, we are satisfied that LIAT 2020 has a very good potential of rising from the ashes of LIAT 1974 Ltd, meeting and going beyond the expectations that currently exist for intra-regional travel,” Nicholas said. (BT/CMC)