HomeBreakingCOPE is impressed with the management of SriLankan

    COPE is impressed with the management of SriLankan

    Chairman of SriLankan Ashok Pathirage tells how Srilankan ran without taking money from the treasury for 3 years

    The Chairman of the Committee on Public Enterprises (COPE) of the Parliament, Member of Parliament Prof. Ranjith Bandara said, that SriLankan President Ashok Pathirage stated very clearly that regardless of the future decision to make SriLankan Airlines public-private partnership or privatizate, how the airline should be managed until then.

    He mentioned this in the light of the explanations given when the high-level management of the company, including Mr. Ashok Pathirage, the company’s chairman, and Mr. Richard Nuttall, the chief executive officer, was called before the COPE Committee in order to get an explanation on how the company will be run as a commercial business before deciding the future of SriLankan Airlines.

    According to COPE Chairman Prof. Ranjith Bandara, the management of SriLankan Airlines has been clearly outlined by its Chairman until a future decision is made. While no major predictions can be made, the airline is being managed on a yearly basis and there is potential for profit in the upcoming year.

    COPE Chairman Prof. Ranjith Bandara – SriLankan Airlines has generated an operating profit in the past two years, signaling growth for the company. However, despite this positive trend, there has been an increase in reserve loss, which poses a challenge to SriLankan’s progress. In fact, the total loss of SriLankan Airlines amounts to approximately Rs. 32000 per person, when divided by the country’s total population. This is a significant setback for the company. The government has already made a decision regarding non-profitable organizations, but it is important to inquire about the institutions that are responsible for managing this issue.

    CEO Mr. Richard Nuttall – During the Covid pandemic, we had a delay in the repayment of the money we had to pay for the engines. Therefore, we had to pay a high interest of 18% for that. It took a considerable amount of time to reconcile. Although we came to an agreement and signed the contract, we were not able to get the engines easily from Rolls-Royce. Several A-330 type planes that needed engines can be flown again within the next 2 weeks.

    MP Mr. Charitha Herath – Now, various recommendations are being presented by the documents presented including the International Monetary Fund (IMF).

    Chairman of SriLankan, Mr. Ashok Pathirage – We did not know such facts regarding the plan for full privatization. But the government is currently in a strong position regarding the privatization of SriLankan Airlines. We feel that if we find the right partner, it is a good support for long-term sustainability. As long as the airline is owned by the government, it has had to face many political and other changes.

    MP Mr. Anura Priyadarshana Yapa – Recently, two incidents were reported. One flight faced a 30-hour delay. Also, another flight that flew to Dubai had to fly back to Katunayake due to a technical fault.

    Chairman of SriLankan, Mr. Ashok Pathirage – This is a normal occurrence for any airline. I understand that such incidents should not happen. It takes about 20 hours for us to send another plane. I think we did the best we could. And as you know we only have a limited number of aircraft.

    Secretary of the Ministry of Ports, Navigation and Aviation Services, Mr. K. D. S. Ruwan Chandra – Our opinion is that the entities owned by the airline should be administered separately. But the Cabinet decided that it should be restructured. Although proposals have been made that it is appropriate to hand over to an investor, no final decision has been reached so far.

    MP Mr. Madhura Vithanage – During the time when MP Harsha da Silva was the Chairman of the COPE, you presented a proposal on behalf of SriLankan, didn’t you? It caused a great panic situation.

    Chairman of SriLankan, Mr. Ashok Pathirage – If we had been allowed to do it at that time, we could have bought airplanes for less amount than today. The airline could have done better than this. Due to the delay, the demand for planes is high now. Have to pay more price now.

    COPE President – What is the solution you have to the current problem?

    Chairman of SriLankan, Mr. Ashok Pathirage – We will get 10 aircraft within the next 4-5 months. We do the deficient supply. Countries like China are now opening their borders. Tourists should come to this country. That is the responsibility of the national airline. We have not received any provision from the government treasury in the last two or three years. We ran our services from the revenue we generated. And we have not taken help from any state bank. Because they were not in such stability. We think this can be brought to a profitable level as long as there is peace in the country, no agitations, etc. We look forward to that.

    SriLankan Airlines is currently focused on continuing to manage operations with existing aircraft to destinations it is currently operating, even though a number of aircraft will be withdrawn from operations next year. We currently do not expect to expand operations next year. Srilankan is already benefiting from the flight operations. Debt payments are also made from those profits.

    MP Mr. Shanakkayan Rasamanikkam – Is there any possibility of starting direct flights from Switzerland to Colombo? Tamil community will be very happy if that can be done.

    Chairman of SriLankan, Mr. Ashok Pathirage – You may be aware that we have expanded our operations in the past 3 years. Because a decision was taken 5 to 7 years ago and several destinations were closed. We have expanded to a number of destinations. We have increased operations in several destinations like Moscow, Frankfurt, Paris etc. But the problem is, you know our current situation. We are restricted. Consider China, as our CEO explained. Now places like China are reopening for travel. We have a responsibility as the national airline to support the national economy. So tourists should also come. It is a certain responsibility as the national airline. Especially as the national airline. But a private airline will not do that. Because a private airline only looks at the profit of the respective airline. If we are right, 99% of the time, we should also try that. Because we also should survive.

    And I must remind you that in the last two or three years, we have not received any money from the treasury. We accomplished everything by ourselves. With the money we earn and everyone’s support. We did not depend on the Treasury. We did not take at least one dollar. We did not even take help from any government bank. Because they are not in a position to help us. So we didn’t even ask. We know what the reality is. We all know that this should be done as a commercial venture. There must be commercial viability here.

    We have to shorten some destinations. We fly to Paris during the season. But in the off season we have to reduce the number of flights. Then we have to combine Paris and Frankfurt. It is in this situation that we have to act. We also like to support passengers with direct flights to Switzerland. But we may not be able to reach that decision very soon,” he said.

    Video of the COPE Committee discussion below.

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