Pakistan International Airlines (PIA) has reportedly decided to reduce 3500 employees, through the Voluntary Separation Scheme (VSS).
Sources within the Ministry for Aviation have revealed that the officials have finalized the employees ‘retrenchment plan’ that will be submitted to the Economic Coordination Committee (ECC) for approval.
Briefing the ECC, the Aviation Division referred to a meeting held on December 30, 2017, where it was decided that the government of Pakistan will pay the mark-up on the debt of PIACL directly to the lenders for five years.
In this regard, the Finance Division had allocated Rs. 24.5 billion in the budget of the financial year 2019-20 for payment of mark-up on GoP guaranteed loans.
It also mentioned that a shortfall of Rs. 3.2 billion existed in the budgetary allocations for PIACL meant for mark-up payments on GoP-guaranteed loans.
The division also requested the cabinet’s economic committee for an additional grant of Rs. 3.2 billion for repayment GoP guaranteed loans.
According to sources, Aviation Division also referred to a summary submitted with the ECC regarding the mark-up and VSS on July 9, 2019. The ECC had deferred a decision on it until the end of Hajj operations 2019.
It also mentioned PIA’s plans to offer a golden handshake to its 3500 employees with an estimated cost of Rs. 9.7 billion.
More details in this regard are being finalized in consultation with a legal expert, which his likely to be completed by June 30, 2020. After finalization, the plan would be tabled before the ECC for approval.