Political interference, lack of professional leadership behind PIA's chronic losses: audit report

Published October 2, 2018
The 500-page audit report says the PIA has been run like a non-business entity. — File
The 500-page audit report says the PIA has been run like a non-business entity. — File

A 10-year special audit report of the Pakistan International Airlines (PIA) presented in the Supreme Court on Tuesday attributed the national carrier's chronic losses to a lack of "professional and experienced leadership".

Prepared by the Auditor General of Pakistan (AGP), the 500-page report identified the last decade's worth of losses incurred by the PIA, and also ascertained the reasons leading to it.

The carrier's accumulated losses in 2009, according to the audit report, were Rs73bn, which had snowballed into Rs 360.39bn by 2017.

The audit report gives a break-up of all the factors that contribute to the PIA's annual losses and poor financial performance such as inefficient fuel management, unnecessary expenses on crew, performance of subsidiaries, poor supply chain and contract management, inefficient engineering and maintenance department among others.

However, the report holds the carrier's top leadership as the main reason for the company's troubles, stating: "PIAC has been run like a non-business entity, governed by the non-professional BoDs, managed by CEO lacking industry specific experience."

To improve the airline's performance, the audit report made several recommendations, chiefly among those were the appointment of CEOs and MDs on merit and putting an end to "unnecessary interference from government".

The report further advised that the "National Aviation policy, ASAs with Gulf and Turkish Airline be reviewed" and "efficient and dynamic BoD be constituted to turnaround the airline".

The top court asked PIA to submit a reply on the report within a month.

The audit reported was submitted in the apex court following it's June 2018 directives to do so during the hearing of the PIA corruption case.

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