By Charmaine A. Tadalan
Reporter
AIRLINES in the Philippines are asking the Congress for P8.6 billion in monthly assistance to sustain operations while strict travel restrictions are in place due to the coronavirus disease 2019 (COVID-19) outbreak.
The Air Carriers Association of the Philippines (ACAP) on Monday said the needed funds would cover P1.3 billion for wage subsidy, P500 million for payment of fees, and P6.8 billion for working capital.
“Our estimate that we have also submitted to Congress is a wage subsidy of P1.3 billion per month…, submitted and consolidated coming from the carriers; in terms of other support, we pay about P500 million to the aviation authorities monthly,” ACAP Executive Director and Vice-Chairman Robreto Lim told the Senate Committee on Public Services.
“We have requested also a working capital of P6.8 billion for the carriers. The total of that is P8.6 billion,” he added.
He noted the P500 million monthly payment to aviation authorities goes to the Manila International Airport Authority, Civil Aviation Authority of the Philippines (CAAP), Mactan-Cebu International Airport Authority and the Clark International Airport Corp., among other provincial airports.
ACAP is composed of Philippine Airlines, Inc. (PAL), Cebu Air, Inc. (Cebu Pacific), Philippines AirAsia, Inc., Air Philippines Corp. (PAL Express), and Cebgo, Inc.
The committee, led by Senator Grace S. Poe-Llamanzares, was conducting an inquiry on the resumption of public transportation, which was suspended due to the implementation of the enhanced community quarantine (ECQ).
President Rodrigo R. Duterte placed in mid-March the entire Luzon island on a lockdown, which suspended classes, work and public transportation. This was later extended by two weeks until April 30 and again until May 15.
The government also imposed a one-week suspension on inbound international flights starting May 3. CAAP later said it would relax restrictions by allowing inbound flights but with a cap of 400 passengers per day, starting May 11 to June 10.
“There’s absolutely no revenue generated by the local carriers. Any extension of the ECQ, of course, will further increase the losses,” he said.
Mr. Lim said the International Air Transport Association (IATA) estimated the industry would incur losses of $4.9 billion until the end of the year.
He added ACAP projected that the airlines would be able to resume only 20-30% of their network due to lack of consumer confidence and other issues relating to the risk assessment of local government units.
According to IATA, about 500,000 workers are at risk of displacement. This covers some 25,000 regular employees and those working for associated airline entities, including those engaged in travel and tourism, and the hospitality sector.
“Right now, there’s no large-scale lay off of employees in the aviation industries. The ACAP carriers have continued to maintain the workforce, and wage subsidy from Congress would help the airline industries to sustain it,” he said.
Senators Risa N. Hontiveros-Baraquel said she is open to the proposal considering it guarantees job security of the 500,000 employees.
“Since the labor cost is a significant part of that then I suppose the other side of it is some assurance of security of tenure for the existing employees,” Ms. Baraquel said.
Senator Ralph G. Recto asked ACAP to submit the proposal for the Senate’s consideration when it takes up the stimulus package proposal.
