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Govt to ensure Air India pays wages

Govt to ensure Air India pays wages
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First Published: Wed, Aug 03 2011. 01 36 PM IST
Updated: Wed, Aug 03 2011. 01 36 PM IST
New Delhi: Prime Minister Manmohan Singh told Parliament on Wednesday that the government will ensure that wages of state-run Air India’s employees are paid.
Singh, who intervened during question hour in the Lok Sabha, said this will be done irrespective of the final outcome of the group of ministers’ report on Air India’s restructuring.
Singh was responding to concerns raised by several Members of Parliament (MPs) over the current status of the airline.
The Prime Minister said it’s an open secret that Air India is in “serious difficulty”.
Singh said the salaries for June and July and productivity-linked incentive for employees would be paid at the earliest.
Minister of state in Prime Minister Office (PMO) V Narayanasamy, who replied to questions on behalf of ailing civil aviation minister Vayalar Ravi, said the “turnaround plan and financial restructuring plan” of Air India are presently being looked into by a group of officers appointed by GoM.
As per provisional estimates, Air India’s loss before tax during 2010-11 is expected to be Rs6,994 crore, Narayanasamy said, adding the total accumulated losses of the state carrier would be Rs13,326.86 crore as on March 2010.
The turnaround plan submitted by Air India envisages substantial equity support and the same is being examined by the government.
He said the main reasons for the huge losses were decline in passengers, increased financial cost, entry of low-cost carrier and interest outgo on loans taken for purchasing new aircraft among others.
(PTI also contributed to this story)
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First Published: Wed, Aug 03 2011. 01 36 PM IST