NPP Govt. abandons plan to privatize SriLankan Airlines

30 September 2024 08:07 am Views - {{hitsCtrl.values.hits}} 72 Bookmark

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* Says it should remain with state for tourism promotion

* Plans for new management improvement

Colombo, September 30 (Daily Mirror) - The National People’s Power (NPP) government led by President Anura Kumara Dissanayake is to abandon initial plans by the previous rule to sell off or divest the cash-strapped SriLankan Airlines, an official said.

The previous government initially planned the sale process of the national carrier through the State-Owned Enterprises Restructuring Unit . After that the former Cabinet said it abandoned the sale process and decided to look at an alternate model to divest the airline.

However, the Chairman of the NPP Economic Council Prof. Anil Jayantha said the government believes that the national career should remain with the state given its significance for the development of tourism. He said the airline would not be sold off or divested as a result.

He said a new model for the improvement of its management would be considered instead.

The previous Cabinet agreed to take over debts of US $ 510 million debts of the national carrier in a move to attract a private investor. It originally decided to sell at least 51 per cent of the state-owned carrier.

Comments - 72

Ranga Monday, 30 September 2024 08:19 AM

I am not sure if this the right move specailly given its 5500 staff for 24 leased planes Gov should at least list it on CSE

5 65

Mandayan Monday, 30 September 2024 11:48 AM

The government should investigate the episodes of Mahinda’s brother in law and Mihin Air affairs of Vas to dig out how much money they pilfered.

0 5

Hadam Monday, 30 September 2024 12:31 PM

It not the right move. Its a big mistake and first NPP mistake.

3 6

SM Monday, 30 September 2024 12:40 PM

…and so the inevitable communist rot started in the Emerald Isle. After a few useful but easy changes like opening a couple of roads in the country, and stripping a few political perks such as vehicle, which helped the debt situation by 0.06%, the communist ideology of hyper unionism and atrociously inefficient State Omned Enterprises put the final nail in the coffin of Sri Lanka’s nascent recovery from the worst financial crisis ever. Soon after Sri Lankan Airlines privatisation was scrapped, others such as CEB, CPC, etc. followed. Once again the people were plunged back into hunger and darkness… and much worse unspeakable things soon befell the people.

5 6

prageeth Monday, 30 September 2024 08:23 AM

I'm ok not selling SLA, but NPP must get into some agreement with smart airline operators such as Singapore airline to come to a partnership to operate it and get some profit share and taxes, that's the smart way to manage this loss-making airline, giving it to local company or government trying to run it further a recipe for disaster, I support NPP and hope they make the right decision on this.

9 55

Watch my word Monday, 30 September 2024 10:29 AM

Singapore airlines will never come to an agreement with a Marxist government.

50 44

My My.La Tony Monday, 30 September 2024 10:52 AM

The first Prime Minister was said to have been a Communist, though he followed a capitalist economy.

1 5

Mina Monday, 30 September 2024 11:00 AM

What a stupid statement, looks this boy still lives in 70 s

1 5

Marx Monday, 30 September 2024 11:47 AM

bro, Marx has nothing to do with this deal. If the deal makes sense the counterparty would agree regardless if Marx is still alive or not

1 9

Liberal One Monday, 30 September 2024 11:06 AM

Won't happen. Singapore always considered Sri Lanka as a competitor and will never help us in transportation sectors.

0 4

Hisham Hussain Monday, 30 September 2024 08:25 AM

Previous govenment took in $510 ?

7 8

wickrama Wijayasiri Monday, 30 September 2024 08:29 AM

When Singapore Airlines trained and managed it, it was a very good airline. Then came CBK and political involvements, even to the level of selecting staff. The rest is history. Good luck for reviving it to the past glory. Anything could be done , of course, if we can break the mold. Involvement of Emirates started the decline.

9 35

R A R A Ranasinghe Monday, 30 September 2024 10:35 AM

Yes indeed, under CBK's government the glorified company turned into a co-operative outlet by Union leaders who said English is not required for the official duties. That was the start of the downfall of the company.

6 30

QRT Monday, 30 September 2024 11:37 AM

The decline started when the R family terminated the agreement with Emirates when Emirates refused to fly the R family for free

0 8

SLankan under Emirates Was Doing Fine Monday, 30 September 2024 11:57 AM

@ wickrama W - I thought Emirates was running well until MR came along and wanted to run the airline as his personal property!

0 9

Bandara Gamaga Monday, 30 September 2024 08:33 AM

Bad decision. Poor tax payers, paying for incompetence of mangers.

6 52

Libtard Monday, 30 September 2024 11:09 AM

Did you expect a leftist government to privatise state assets on election day?

4 4

ADN Monday, 30 September 2024 11:22 AM

Agree with you. If we go ahead with this decision it will be another disaster for the nation. In fact tax payers cannot bear the such huge losses repayment and maintenance of such high salaries. I don't think we can save country this way. Hope AKD government has to preview and expidite the there decision again.

1 0

Good citizen with NPP Monday, 30 September 2024 11:24 AM

This is very true. when I fly recently I saw lot of crew in one flight in different colors and I think most of them are mangers without doing any work in the flight but just seated. only very few were actualy working. lots of money is wasted here.

1 0

Mandayan Monday, 30 September 2024 12:11 PM

@Bandara: No buyers, that’s the fact!!

1 1

Nimal Monday, 30 September 2024 08:36 AM

The first logic is correct. If Sri Lanka is to be a competitive tourist designation today a National Carrier is a must. However, Govt interferences on anything to do with operating or managing the airline has to stop completely. How to balance this act and pull this debt ridden, cash bleeding airline out is a different challenge. Finally, the Govt must ensure legitimate accountability and charges are pinned on those who were directly responsible for this wreck; not ignored or swept under the carpet.

5 30

Nimal Monday, 30 September 2024 08:46 AM

They couldn't even take control back of country's one and only airline from downfall for many years by many leaderships. It clearly shows that how our govt were so brilliant...No wonder that economy of the country is easily being collapsed

4 16

Vihan Monday, 30 September 2024 08:50 AM

Not a good decision. The government needs to get out of the business of doing business an focus on policy formulation. Just wait and see the cronyism will continue even without the blessing of the ruling powers. Simply get rid of the thing.

7 35

Christo255 Monday, 30 September 2024 08:56 AM

Good Move but Richard Nuttall deserves to stay. He has done something for the airline and at least stabilised it.

10 14

amaran Monday, 30 September 2024 08:57 AM

Very poor decision. This state-owned entity alone made the country poor. Very poorly managed entity as it required expert knowledge to manage and non-governmental interference in the management affairs. The given reason to retain is not acceptable. Do not think our "tourism" is slimier to India which has a big market.

9 36

Will Be Challenging To Run It In A Bankrupt Climate Monday, 30 September 2024 09:06 AM

Seriously study the impact of managing this airline in this terrible situation. If possible, have your professional team to check if those flights taken by the leaders of previous regimes were paid for. Maybe from there, some payments can be collected or prosecution can be carried out accordingly if no payments were done. Anyways, will be challenge to maintain the airline in this Bankrupt climate. Hope the team involved to study the feasibility gives a time line and action plan to ensure it’s ideal for the government to run the airline.

3 10

L Jaya Monday, 30 September 2024 09:07 AM

Government should maintain majority shares 51% and allow private parties to own 49% and giving management. If you own 100% this highly inefficient and low productivity organisation, if Government decides a stupid move.

4 14

Namal Monday, 30 September 2024 09:07 AM

Communism’s working

11 27

M Fernando Monday, 30 September 2024 11:35 AM

Do you seriously believe Mr. Bean would have sold it either ? Like his many plans for this, that or the other (in the future), it would never have happened. Also, do you believe that locally assembled cars are being churned out of RW's recently opened "car factory" ?

2 3

This is reality Monday, 30 September 2024 09:19 AM

Agreed that the national airlines should be an asset of the State but the liability factor should be given priority consideration. Better not make hasty decisions but sleep on it until something realistic is formulated.

6 13

Lakshman maddumahewa Monday, 30 September 2024 09:24 AM

Imf staff agreement clearly highlighted this white element to be restructuried with out state interference. If moving out ,it will be imf agreement will be grounded

8 17

My2Cents Monday, 30 September 2024 09:33 AM

Leaving politics aside ....is this really wise? The gov doesn't have money to invest on the airlines... no matter how you change the management, without money to invest on any sort of expansion how will SL recover?

5 23

Economist Monday, 30 September 2024 09:43 AM

The airliner does not need to sell, but it should manage as a private company. This means, it must manage with efficiently and productively. Excess staff has to be redundant or be absorbed by other state organisations where lack of staff. Procurements must strictly be done at market prices. I think it would be better to get some experienced foreign staff to work with our local staff. This will help local staff to learn more skills.

5 16

Sriyani Monday, 30 September 2024 11:00 AM

It is clearly obvious from your comment that you are no Economist! It is doubtful that you even have a higher education.

2 1

Gamini Monday, 30 September 2024 09:43 AM

The previous Chairman abused his position by diverting stranded/canceled/delayed passengers all the way to his own hotel in Colombo, instead of the usual practice of housing such passengers in the close vicinity of the airport or in Negombo, incurring considerable additional cost for transport to and form Kollupitiya and paying highway toll

3 10

Sunil Monday, 30 September 2024 11:41 AM

Are you 100 % sure. It is then a conflict of interest. It should be stated in the audited financial statements. If so, the Chairman should be charged and fired if convicted.

0 2

Tissa Fernando Monday, 30 September 2024 09:45 AM

Decision not to sell was alreafy tsken ss no one gave a proper offer. It is good to keep this within the state but I am not sure how it could come out of debts and still improve . I don't understand what the ownership of the sirline got to fo with 'Tourism promotion '. That creates some doubt about the objective.

6 10

Charlie Hebdo Monday, 30 September 2024 09:51 AM

Everything, the economic recovery Ranil achieved, will be destroyed. The downfall has began!

26 30

Ravi Monday, 30 September 2024 09:51 AM

So are you guys going to continue to use our tax money to maintain a failing company?

11 31

Cecil Hedwige Monday, 30 September 2024 09:54 AM

They should appoint Super Management if it is to improve the profitability of the airline and not appoint political favourite"s to run the airline to the ground. The new Managment should be given a free hand and targets to run the airline efficiently.

2 15

Here we go again Monday, 30 September 2024 10:05 AM

Subsidizing, subsidizing, subsidizing and bankrupting the government.

12 23

Dilakshan Seneviratne Monday, 30 September 2024 10:09 AM

Good decision, just as promised by AKD before the elections. The carrier is mandatory for bringing tourists to SL without stopovers from places like London, Frankfurt, Melbourne, Japan. Employing a good management team and no political interference will make this company a profitable one.

20 20

Ranga Monday, 30 September 2024 10:25 AM

He never said that Hadunnetti said they may look for someone like Paliyapitiya but Paliyapitiya isn't stupid out his money in a company that's way overstaffed for 24 planes which is tiny by any comparison If they don't want to privatisatise then at least list it on CSE and stop wasting tax payers money You don't need a government run airline to bring tourist you just need the airport to lower landing and handling fees so low cost carriers can operate

1 14

C Fernando Monday, 30 September 2024 10:32 AM

Tourists can still come to Sri Lanka without stopovers even if the airline is privately owned! If they really want to, the government can structure it so that they have a "golden share" which gives them certain rights over ordinary shareholders under certain circumstances. The fact is a private investor will want a return on their money so will ensure that they run the airline efficiently and will also ensure that they bringing in the maximum possible passengers. So tourism in this country will not suffer if the airline is privatised.

0 10

A Supporter of Ministers who demand Commissions Monday, 30 September 2024 10:18 AM

Oh My God; What about the Commissions for Mr. Commissioner alias Minister alias N.S. de Siva? Please recruit him to be in charge of reversing Privatization.

5 7

Yoga Monday, 30 September 2024 10:22 AM

The first step going back to 70s era!

6 18

sachith Monday, 30 September 2024 10:23 AM

I think truth is that, no on wants to buy it. No bidders for earlier calls (2 times if I remember right)

1 8

Citizen Monday, 30 September 2024 10:25 AM

Government can set up a similar model like Slintec, where 50% is owned by gvt and the rest is with big conglomerates like MAS, Brandix, Haycarb , Browns...etc. Same way the top players in tourism can join together to manage Sri Lankan Airlines as a PPP model.

2 4

A Supporter of Mr. Commissioner Monday, 30 September 2024 10:26 AM

What is wrong with you NPP guys; New President AKD and Ministers; Don't you want to earn massive commissions by privatizing Sri Lankan Airlines? If you are unsure, ask Sri Lanka's Mr. Commissioner. who has become a former Minister after the dissolution of the Parliament.

11 9

If For a good future Sri Lankan Monday, 30 September 2024 10:28 AM

It’s a stupid decision If tourism is the only reason to keep within state. As someone already pointed, make unnecessary staff redundant and get the maximum out of staff thereafter, means get them to do their job. This should apply to all areas and all levels. Introduce KPIs to evaluate year end performance. Low performance should be addressed

1 14

Poor Taxpayer Monday, 30 September 2024 10:30 AM

Poor Taxpayer

2 19

Out of the box Monday, 30 September 2024 11:11 AM

Tax payers can benefit from this if we can make it a competitive, profitable airline. Singapore, Emirates, Qatar does it.

0 3

BuffaloaCitizen Monday, 30 September 2024 10:36 AM

This kind of Enterprises will never be successful under Government. We know all government entities work at less than 50% efficiency and worse riddled with corruption. The NPP like Anura Kumara himself stated, cannot do magic. This entity has burdened the public for too long. The money lost in this airline could be utilized to build more Universities, Hospitals and Schools. If this airline cannot be sold to a Private entity, then we need to at least close it down permanently to stop the loss, without playing games.

1 0

Kasun Dissanayake Monday, 30 September 2024 10:40 AM

OMG is this the same people who heavily criticized SLA as a white elephant? Is it suddenly turned black?

0 0

Rishan Monday, 30 September 2024 10:42 AM

Must stop all free tickets given to airline staff and recover the cost of the trip by removing the profit margin. What is the annual cost for the free tickets provided to 5000 active staff and also to pensioners?

0 0

Gabriella Monday, 30 September 2024 10:45 AM

Excellent decision !!! Give Mr Nuttal a "free-hand" and we will have a world class airline. I fly with the airline at least twice a year. The first time in 1974 when it was an acknowledged world class; award winning airline. The reason for the decline of the airline is known to all. The transformation of the airlines' service culture by Mr Nuttall, has been nothing short of miraculous. It is now world class. I implore my fellow Sri Lankans to stop regurgitating worn out bilious rhetoric and give Mr Nuttall, and the airline a chance. Take my word for it: We have the CEO and we have the staff. We need some new planes and success is assured. It will give talented youth an opportunity to pursue careers as pilots without having to look overseas. The turnaround of the airline is not an impossible dream; it is within grasp.

1 1

Foot note Monday, 30 September 2024 11:00 AM

Come up with a solution. You may say this only until general election. If there is a practicable in house solution, implement right now and show your colours by Nov. Remember NPP has to convince more to get parliamentary majority as people indicated cleary on 21 Sep., that they are not ready to give a single party, overhelming power.

1 0

The end of wal palama Monday, 30 September 2024 11:01 AM

This is the first thing Ranil Wickremesinghe said he would do. Though he could not make it in time, and now it is the job of NPP. I think almost all candidates also agreed to selling SOEs like this. Even NPP said they would not be against selling SOEs like airlines. NPP going against their election promises within few days of taking the power is not a good sign for our country or our economy.

1 0

Upulpb Monday, 30 September 2024 11:04 AM

Appoint a chairman and a board of directors with aviation and business management skills and give them an ultimatum to turn the full operation in to a profitable venture. No more government funds

0 1

Mk Monday, 30 September 2024 11:05 AM

Hahaha. Here we go! Pathway to bankruptcy. Keep pumping tax payers money to these black holes.

1 0

Aiyoo Monday, 30 September 2024 11:19 AM

Nobody will invest in a debt ridden, poorly managed, highly unionized, overstaffed, airline that has an aged fleet with a poor maintenance record.

1 0

Damith Monday, 30 September 2024 11:28 AM

How can you reduce taxes and continue to maintain a loss making institution? Bad decision.

1 0

tilak Monday, 30 September 2024 11:30 AM

MR is primarily responsible for this mess. Sacked CEO for not accommodating his ging bang crowd of free passengers while Emirates was doing a pretty good job of making it a profitable airline and then went on to start Mihin another loss making airline which gobbled up over Rs.6 Billion annually

0 1

Jayampathi Monday, 30 September 2024 11:46 AM

It is not a stupid decision if the correct board is appointed, right CEO and management is in place and good business plans are developed and low cost funding from World Bank is obtained. There should be no political interference and the best talent should be re recruited with defined performance targets. There is lot of air traffic and we must get it and not give it to Indian budget airlines or Other regional airlines.

0 1

Hard Truth Monday, 30 September 2024 11:58 AM

Don't worry, All will be done accordingly and sue course. The issue is ploitical appointment, poor management and structure once it is sorted no need to sell.

0 1

Dee Monday, 30 September 2024 12:01 PM

Congratulations to the tax payers!

1 0

Ajith Thamboo Monday, 30 September 2024 12:10 PM

Here we go full circle again. Government doesn't need to do business. Tourists are anyway coming here all sorts of airlines from their respective destinations. If privatised, at you earn money through taxes.

1 0

Anees Ahamed Monday, 30 September 2024 12:11 PM

This is a positive step by the government, and now is the time to support them. From what I understand, they are making great progress and taking proactive measures, including various cost-cutting initiatives. This is one of the most promising signs we've seen, something that previous governments have not achieved. They've undertaken a difficult task, so let's remain optimistic and supportive.

0 1

Reformist Monday, 30 September 2024 12:13 PM

Well, abandoning the privatisation should be one done carefully. One would say the previous government already abandoned it due to the lack of buyers. Running things like an airline MUST be done in a business like manner, free from political influence with right people in the right positions without nepotism. That was the start of the downfall of this airline. This airline's on-board service etc is very good and if one can turn this airline around, that would be great. Specially it is Australian and English routes are very profitable as I observe. Lessons: Leave the government business on the hands of capable people. Stop nepotism. Introduce KPIs and remove their reliance on taxpayer funds. If NPP can show people how it tries to turn things around in all aspects of government, they will be there for the long haul. SL only has experience with rogues, corrupt and incompetent public servants.

0 1

Jeanne Monday, 30 September 2024 12:27 PM

First business mistake. Many more to come.

1 1

Yar N Monday, 30 September 2024 12:31 PM

Very good move by NPP. Why do Srilankan airlines lease aircrafts, when we can fly kites, tourist will love it. We can make kites in Sri Lanka, create more jobs, and no fuel required to fly them. Please dont sell or divest Srilankan please keep it, and fly kites. Good for tax payers too.

1 1

We will not sell Sri Lankan Airlines Monday, 30 September 2024 12:49 PM

I think we have now started a new journey, a journey that goes back to old and failed models. i.e. the government must do business. What to produce, how to produce, how much produce, who should produce and consume them decisions made by the central planners - an utter failure. Don't these new rulers understand the strain on government coffers by retaining these cash draining enterprises? The NPP has promised tax cuts and also to reduce prices of goods and services. How are they to achieve these? This is the problem. When people do not have much idea of how an economy works, dreamy statements become very attractive, and they vote for people who make such statements en masse. But when the reality sets in then it is too late. Those who come to rescue the economy are thrown out. The cycle continues. Sri Lanka will remain in this sorry state for eternity.

0 0

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