ISLAMABAD: The Supreme Court on Saturday ordered a comprehensive audit of the ailing national flag carrier — the Pakistan International Airlines (PIA) — in 10 weeks by the auditor general of Pakistan and restrained the airline from changing its livery with a picture of markhor.

A two-judge bench headed by Chief Justice Mian Saqib Nisar had taken up a case regarding replacement of the Pakistani flag at the tail of PIA aircraft with the picture of markhor, the national animal of the country.

The PIA management had been insisting that rebranding of the airline with markhor was a commercial decision and the new look was an integral part of the transformation and turn-around strategy of the airline.

The top court was concerned about reports that the PIA had accumulated losses of Rs356 billion ($3.56 billion) till 2017 and its total liabilities amounted to Rs406bn against assets of Rs111bn. The chief justice regretted that the airline could not sustain on the government’s annual bail-out package of Rs13bn.

Auditor General Javed Jahangir presented before the court the terms of reference under which a review would be made about appointments made in the PIA Corporation over the years, financial management, sales revenue, flight operations, running cost, expenditures including deals to obtain aircraft on lease and commercial routes.

Bars airline from replacing national flag with markhor’s picture on aircraft’s livery

Former aviation adviser Sardar Mehtab Abbasi objected to the audit, saying that a professional auditor would do a better forensic audit than the auditor general due to his lack of experience in airline auditing.

The court inquired from the former adviser how he came to know that the auditor general would not be able to conduct the audit of the airline and also asked about his qualification in the field of aviation.

“You are a politician having experience in the construction business,” the chief justice told the adviser who retorted that he had the experience of administration as he had worked as a chief minister and a federal minister. “I know how appointments are made in government departments,” he said.

The chief justice said that ‘political appointments’ were made in government departments, adding that Mr Abbasi was appointed adviser after being removed as governor besides “he has not been awarded party ticket (for election) and now he is leaving his (political) party”.

Mr Abbasi responded that he was not removed from the governorship, rather he himself resigned from the post and was appointed adviser after a year.

Justice Muneeb Akhtar, a member of the bench, regretted that 14,000 people had been employed in the PIA against 34 aircraft and asked the adviser how many employees he had removed during his tenure.

The court also allowed removal of the name of former adviser on aviation Shujaat Azeem from the Exit Control List but with the condition that he would appear before the auditor general and the court whenever called. Otherwise, his property would be seized.

Advocate Mirza Mehmood, who was representing Mr Azeem, told the court that he had furnished financial acco­unts of the last eight years but the court said he had not been ordered to deposit the same.

“Your only purpose is to improve your image among the people,” the court observed but the counsel said that the only purpose of submitting the documents was to assist the court in reaching a right decision. However, the court did not allow the counsel to speak.

In its report, the PIA management has conceded that the poor or corrupt decisions by previous managements continue to drain the airline of cash through commercially unviable contracts with no exit clauses, and that such decisions should be subjected to forensic audit by a reputable and credible firm of auditors.

The business class revenue heavily contributes to an airline’s profitability but in the PIA’s case it has been a lost opportunity as the business class service and condition of the cabins have deteriorated over the years and utilisation of business class seats has declined to extremely low level of just 40 per cent, the report says.

The PIA is heavily burdened with unions and associations and over the years, the unions and the associations have been negatively impacting its daily operations by influencing em­­ployees to “go-slow” when they wish to apply pressure on the management, the report says.

Published in Dawn, July 1st, 2018