ISLAMABAD: Finance Minister Ishaq Dar on Tuesday told Prime Minister Nawaz Sharif that no Pakistan International Airlines (PIA) employee will be laid off as the national flag carrier undergoes privatisation, Radio Pakistan reported.

Calling on Nawaz in Islamabad, Dar said the PIA company law partnership will offer job protection to PIA employees and insulate the national flag carrier from bureaucratic control, allowing it to operate as an autonomous corporation along the same lines as the Oil and Gas Development Corporation Limited.

Pakistan International Airlines Corporation (PIAC) was converted from a statutory corporation into a company governed by the Companies Ordinance, 1984, by means of a presidential ordinance No XVII dated Dec 4, 2015. The new entity is called Pakistan International Airlines Corporation Limited (PIACL), PIA Chairman Nasser N. S. Jaffer confirmed on Sunday.

During his meeting with Nawaz, the finance minister assured the PM that the government is focused on rehabilitation of Temporarily Displaced Persons (TDPs), who he said had made sacrifices for Operation Zarb-i-Azb.

The prime minister directed that all resources be made available for the prompt and honourable rehabilitation of displaced people.

Dar also informed the PM that of the Rs40 billion revenue generated through regulatory duty on luxury items, Rs27bn will be allocated to provinces.

Privatisation of PIA

The PIA chairman in a statement released Sunday said that through the ordinance, the PIACL had succeeded to all the assets, liabilities, duties and obligations of PIAC and is now entitled to the benefit of all notifications, licences, permissions, sanctions, authorisations, concessions, decrees, international air service authorisations, agreements, orders and benefits issued or granted to PIAC.

He said all lenders (foreign, local, fleet and non fleet) and other creditors of PIAC shall continue to enjoy from PIACL the same contractual benefits and protections that they earlier enjoyed.

All guarantees given by the federal government to secure PIAC’s obligations will now continue so as to secure the obligations of PIACL.

He said the shareholders of PIACL shall own and hold the same number of shares with the same privileges as they owned and held in PIAC immediately prior to the conversion.

Opposition parties on Monday rejected the presidential ordinance alleging that the PML-N government had bypassed parliament because they had already decided to sell the national flag carrier to a wealthy family from the Gulf.

Chairman of the Senate Standing Committee on Finance and Revenue Saleem Mandviwalla in statement on Monday warned "The motive behind the ordinance is to sell PIA to the sheikhs of Abu Dhabi," alleging that the deal had been brokered by Chaudhry Muneer, a relative of PM Nawaz Sharif and his assistant on aviation, Shujaat Azeem.

Pakistan Tehreek-i-Insaf leader Shah Mehmood Qureshi in the National Assembly (NA) on Monday said the promulgation of the ordinance was apparently meant to prepare the ground for the sale of PIA. "Firstly, the government should have created a consensus for this, and secondly, [I don’t think that] in its current state, the privatisation of the national carrier will fetch a good price."

Coming to the government’s defence in Monday's NA session, Finance Minister Ishaq Dar had claimed the ordinance was only meant to make PIA a corporate entity, allowing it independence and autonomy so that it could be run at par with international airlines. As a corporation, the minister explained, joint secretary-level officials could create lots of problems in its smooth functioning.

"I am saying it on the floor of the house, there is absolutely no difference in the overall service structure of PIA employees or its assets and liabilities. Whenever it is privatised, it will be done in consultation with other political parties."

But the minister couldn’t explain why the government had to promulgate the ordinance in such a hurry. He only said that time was of the essence and that if a decision had been taken with good intentions, nobody should fault it.