Sky-high waste

A Parliament committee has heard details of arrangements which raise many questions. And questions which we hope are answered.

Acting CEO, Capt Jagmohan Singh, said CAL is still paying part of the lease for two Boeing 767 aircraft which CAL was using for its Port-of-Spain to London route.

That route was discontinued on October 6, 2015, almost one month after the People’s National Movement (PNM) won the September 7, 2015, general election.

CAL officials explained that the figure of US$270,000 a month equated to a cost of US$135,000 a month for each of the Boeing 767 planes which the State-owned airline no longer has.

The officials said the agreement to dry lease these planes ends in August.

The two Boeing 767 aircraft are currently in Canada and do not appear to be in use by CAL.

Whether these contract arrangements are standard will be a matter the Parliament’s State Enterprises Joint Select Committee will have to examine. If the terms were not standard, then the circumstances of the arrangements being entered into must be examined.

Either way, the arrangements represent a waste which may have been avoidable with a more coherent system of planning at CAL.

A key issue behind this is to note the timeline involved. It seems crucial decisions were made during a period of transition after a general election. Is this yet another example of why these transition periods — which are inevitable — are dangerous to taxpayers’ interests? How can risks be mitigated? Should crucial decisions to enter or end arrangements be made during such windows? Another matter is whether the State’s multi-tiered system, involving ministerial oversight, public service bureaucracy, and State enterprise procedure, is effective.

Do all these layers really insulate the Treasury or do they open the door to inefficiency and things that are more nefarious? CAL provides a fundamental service, not only to Trinidad and Tobago but to the Caribbean. It has over the last few decades, in its various incarnations, helped bring the diaspora closer together, be it New York or across the pond in the United Kingdom.

Questions will be asked as to why the London route was unprofitable and whether or not it could have been rehabilitated.

Did CAL have the capacity to do this? If not, why? There is also the question of the morale of the staff, seeing one of its premier routes cut and cut painfully.

All of this points to the perennial problem of CAL’s continued levels of losses. When BWIA — CAL’s precursor — was closed down and its unionised workers shed, the rationale of the State then was that it was setting up a company that could be more profitable. That seems to have never occurred. And CAL is still 100 per cent State-owned.

Additionally, CAL benefits from State subsidies, without which the picture is more dire.

We hope the Parliament committee considers the latest revelations not only in terms of a discrete development but also as a part of a more profound examination of how our State enterprises are working. Sadly, it is likely that CAL is not flying solo on all of the issues raised.