Moving an adjournment motion in Parliament on Tuesday (23) Colombo District JVP member Sunil Handunnetti said that Mihin Lanka airline started by the government with public funds had caused a loss of over 3.2 billion rupees and the airline was now grounded. Two aircraft leased from Bulgaria and Turkey were over ten years old and were not suitable for international flights,

The management of the airline was corrupt and inefficient and funds from the Employees Provident Fund, People’s Bank and Bank of Ceylon were used for starting the airline and the Chief Executive Officer who had no qualifications or experience in the management of airlines was paid a monthly salary of Rs.450,000, r Mihin Air had sold landing rights it had to a Malaysian Company and now it was grounded causing a heavy loss of public funds.

But now a cabinet paper had been submitted by the Minister of Aviation to revive the grounded airline by purchasing 6 new aircraft from China that would add to the billions of losses it had already incurred. The government should have been able to manage the budget airline without continuing to cause so much of loss of public funds and it appeared there was no one responsible for it. It was also learnt that the former CEO of Mihin Lanka had been appointed to a high position after the airline was grounded he said.

Dimuthu Bandara Abeykoon (JVP) seconded the motion.

Minister of Power and Energy Mahindananda Alutgamage said no funds from the EPF or the People’s Bank was infused to the capital of Mihin Lanka and it was totally incorrect to say it was grounded due to corruption. The details about an agreement with a Malaysian company giving landing rights to that company was totally untrue and the JVP now in cahoots with the UNP may be using some details given by the UNP member Ravi Karunanayake who swallowed the CWE in just one gulp.

However the government did not wish to deny it was mismanaged but the loss incurred was not due to corruption but inefficiency. Even the CGR, SLTB and the CEB had continued to incur losses but they were public services. Mihin Air was also stared as a budget airline to provide services to those who flew to destinations like Dubai for employment or to other places like Maldives or India on pilgrimages. Mihin Lanka had flown 215,000 passengers to six destination and it still had the landing rights to several places.

The inefficiency of the management was the sole reason for its losses and now the government wished to appoint a new management to run an efficient budget airline that could make profits.

Lakshman Kiriella (UNP) Kandy District said though the Parliament was the custodian of public funds the details of the expenditure incurred and the losses sustained by Mihin Air was not brought before Parliament. It was totally unconstitutional to start such a large public enterprise without Parliament being made aware of it.

Minister of Agriculture Hemakumara Nanayakkara said there were airlines in the world which were famous but now grounded. It was not only the Mihin Air but Swiss air, Alitalia, Itihad and several other budget airlines in many countries were grounded. It was necessary to revive Mihin Air without closing it down to provide a better service for the migrant labour, pilgrims and business community.

At this stage there was a heated exchange of words between the Minister and JVP member Chandrsena Wijesinghe. The minister said the JVP had collected millions of rupees from its grassroots members and put up a headquarters building at a cost of over ten million rupees. JVP parliamentarians were moving about in luxurious vehicles though its poor members who wore rubber slippers were collecting funds for it to keep the parliamentarians happy. The JVP was finished after the defection of Wimal Weerawansa.

UNP Kurunegala District Member Dayasiri Jayasekara said the airline had been grounded but its website said today there were ‘no flights scheduled as it was not an airline anymore. The budget airlines of the world were run by the private sector and not by governments and even India that had six airlines had reduced it to four to make them feasible.

Minister of Ports Shipping and Aviation Chamal Rajapakse responding to queries made said the proposal to revive Mihin Air will be introduced with the 2009 budget proposals and the Parliament could debate it fully. Even two months before now it was debated in Parliament at an adjournment and questions in Parliament on it were answered many times. The government proposed to revive the airline with complete transparency. Already the board had resigned and a new board will be appointed. Worldwide tenders were called to purchase six aircraft suitable for a budget airline and a Technical Evaluation Committee had scrutinized the tenders.

There was no truth in the allegation that landing rights were given to a Malaysian company but an MoU was signed with that company but it was no longer in force as it was cancelled after three months. Mihin Lanka has the landing rights to many destinations and these were valued over many billions of rupees and its goodwill also remained as assets. Therefore the revived Mihin air will cater to migrant labour to the Middle East as well as to run internal flights to destinations like Ampara, Batticaloa or

Jaffna as there was a demand for such flights, the minister noted.