Speaking during the signing of a Works Council agreement with the various unions of the airline’s employees, both said that while the company was expected to face an additional Lm3 million in costs due to oil hikes, the future still looked better than before the original Air Malta Rescue Package was signed.

Both seemed particularly encouraged by the results obtained by Air Malta in its non-Malta based operations. Answering questions put by this newspaper, both said it increased Air Malta’s passenger carrying capacity and aircraft utilisation – in turn reducing costs and overheads. Both agreed that Air Malta had to become an air carrier across Europe rather than limiting itself to being a national airline.

The Works Council is being deemed as the next logical step in changing outdated and inefficient work practices at the airline.

Dr Gatt, forever functional yet jovial, said that he was very glad that all the hard work put in by all concerned had transformed into a satisfactory agreement for all. “We reached agreement at a very difficult time indeed. But the negotiations were good. And I pledge that if this goes well, the same practices will be introduced at other government companies such as Enemalta and the Water Services Corporation,” said Dr Gatt.

He said the final agreement only came after a concerted effort by all. “There is no problem that cannot be solved if you have the goodwill of all involved. Everyone sacrificed something. And that includes the unions, the management and the employees. All of them gave up something and yet their commitment to the airline is unwavering,” said the minister.

Dr Gatt said that the results, although still a bit premature were encouraging. “We have seen, since the implementation of the last agreement, that things are looking up. The results can be seen,” he said.

Asked by The Malta Independent about the new “non-Malta based” and “better aircraft utilisation routes” introduced by the airline, both Mr Zammit and Dr Gatt said they were definitely helping. (Air Malta has based aircraft in the UK to fly to other destinations apart from Malta. In addition, the company is operating on non-circular routes eg: Malta-Catania-London-Catania-Malta rather than having separate aircraft operating both to London and Catania).

Mr Zammit said the company had managed to get through the hectic summer months with less staff than ever before. “We cut out about 60,000 overtime hours and we have cut off about Lm250,000 in management benefits. We had projected targets and by March 2005, we are looking for better results than achieved this year,” he said.

Mr Zammit said the non-Malta based aircraft were definitely doing well. “They allow us to better utilise our fleet and in turn, better absorb costs and overheads.”

However, he warned of the dangers posed by the hike in oil prices. “Although we have introduced surcharges, the price increase of oil alone is expected to push Air Malta’s costs up by about Lm4.3 million. The surcharges will ensure we recoup about Lm1.3 million of that amount, but it still leaves us with a shortfall of about Lm3 million. This is a challenge and we must find a solution,” he said.

Adding to Mr Zammit’s answers to the question, Dr Gatt said the non-Malta based routes were profitable. “You have to watch them like a hawk to see where the demand is, but they are doing well,” he said.

He said that the airline was satisfied with the results and was looking not only continue with them, but also to expand. Dr Gatt explained that if Air Malta only operated to and from Malta, the airline’s market would be restricted as it could only carry people to and from our country. “People need to realise this, if we just operate to and from here, we are limiting ourselves severely. The initial results have been very positive indeed. We must continue to exploit any opportunity available.”

Asked by TMID whether Air Malta was becoming a European air carrier rather than a national airline, he replied: “Of course, that is the way forward. We must compete, and Air Malta will still be our national airline, but we must also look for pastures new.”

Speaking about the Works Council, Mr Zammit said that the agreement was reached together. “We reached agreement by all parties working together. We wanted to change the culture, the mentality and the outlook of our employees. Signing the first document was the first step. This is the second step and is part of the ongoing process to change the outlook, mentality and outlook within the company,” he said.

Mr Zammit said it was easy to impose new regulations. “But that is not what we wanted, we wanted the staff to change their mentality of them and us, we all have to work together, we depend on each other.”

He said that the company management had kept the employees, through their various unions, informed of all developments every step of the way. “We have always had intelligent and mature discussions. Of course we did not always agree but in the end, we always found a way,” he said.

Mr Zammit warned that all was not pink and rosy. “We do, of course, now have to deal with the massive impact of oil price increases. We have introduced two fuel surcharges, but it is not enough, we must continue to work to reduce the deficit of Air Malta.”

George Abela, who acted as facilitator throughout the negotiations between Air Malta, the government and the unions, said there were many ways in which employees could participate in the workings of a company. “This is novel. A first for Malta. Dr Gatt said there was not much room to manoeuvre, but there was not much need, Dr Gatt took a balanced stance right from the off. His only mission was to make Air Malta profitable again and make it an example of how a company this size should function,” he said.

Dr Abela said it was of utmost importance to keep the employees informed of what was going on at all levels. “All cards had to be on the table, no hiding and this is a pretty big table,” he joked.

He said that everything achieved so far had been achieved through mutual trust. “It all depends on the players who are on the field now, that is the management and the employees. And we know that relations are good between both parties, so we are optimistic,” said Dr Abela.