Gaston Browne: LIAT shareholding governments have no ‘liability to the staff’

Antigua and Barbuda Prime Minister Gaston Browne has appealed to Caribbean trade unions to re-think their position regarding the latest offer made to laid off workers of the cash-strapped regional airline, LIAT.

Browne said what is required is the cooperation of the unions, noting that “some union leaders…are making unreasonable demands, making demands in which they have no legal basis to do.

‘As I have said to the other unions if they really think they are owed 100 per cent of their severance and staff liabilities, go to court and prove it. If they can’t prove it then the governments are giving you a compassionate payment, take it and run.”

The airline had laid off an estimated 90 per cent of its staff last year as part of a restructuring exercise and has resumed operations on a much smaller scale.

Earlier this month, President of the Dominica-based Waterfront and Allied Workers Union (WAWU), Donald Rolle, said that the regional unions are united in seeking the millions of dollars owed to the workers and have rejected the latest offer from the shareholder governments.

“The offer on table which is to pay the LIAT workers, 50 per cent of their redundancy pay and there is a component that involves compensation by issuing of lands and bonds. But the unions around the Caribbean have sort of rejected that in its entirety, but we are in negotiations with the governments. We have a position and as it is now we are at opposite ends of the table,” Rolle said.

But speaking on the Grenada Broadcasting Network’s (GBN) Beyond the News” programme on Monday night, Browne, said that a meeting was held recently with the pilots association “and they were more amenable to striking a deal with the Antiguan government, but as we said to them we have to get all the unions support.

“I mean, legally, none of the shareholding governments has any liability to the staff. As you know the shareholding of the governments would have been limited to the extent of their shareholding. The Antiguan government for example, pumped hundreds of millions of dollars into LIAT over the years and I would accept it had economic benefits, but at the end of the day we would have lost a few hundred million dollars that we pumped into LIAT over the decades.

“In terms of any legal liability, arising from the collapse of LIAT the governments do not have any such liability and it is well known that LIAT’s assets are such that if you sell them on a piece meal basis in liquidation, they may only get about five per cent of their severance liabilities,” the Antigua and Barbuda Prime Minister told television viewers here.

He said the if the Antigua and Barbuda government is ‘offering as much as 50 per cent that is an extremely lucrative deal, in the sense that it is a superior deal to liquidating (LIAT) 74 and selling off the assets on a piece meal basis”.

Browne said that even three planes now owned by the restructured LIAT “they are charged to the Caribbean Development Bank and the loans that the governments are carrying…the balance on those loans exceed the value of the planes. So there is no equity in order to pay severance”.

The airline’s shareholder

He said that in the case of Antigua and Barbuda, if the island was liable based on its 35 per cent shareholding “it would have meant that the liability would have been 35 per cent” reiterating that the latest offer to the trade unions is a lucrative one “and I don’t know why the union leaders do not recognise that they do not have a legal leg to stand, they can’t force the government to give them anything.

“We are doing this on a compassionate basis and if they take the 50 per cent from Antigua and Barbuda and the other governments chip then, then they may make it up to 100 per cent. But asking the Antigua and Barbuda government to pay 100 per cent, I mean that is neither morally or legally equitable.

“Our offer stands at 50 per cent and we are just waiting on them to come to a consensus among themselves to accept the offer,” he added.

The airline is owned by the governments of Antigua and Barbuda, Barbados, Dominica and St. Vincent and the Grenadines (SVG). Last year, Browne said that a decision had been taken that would allow Barbados and SVG to turn over their shares in LIAT to Antigua & Barbuda for one EC dollar (One EC dollar=US$0.37 cents).

During the GBN programme, Browne said that LIAT, under administration, had returned an operational profit for the months of July and August and that there is also evidence that a leaner, more efficient LIAT can be profitable.

“It has been operating on a limited schedule. The demand for air travel is still very weak at this time. However it is providing a service. LIAT is still alive, obviously not in the best of health. It appears at some point we will have to commence a new LIAT, probably a LIAT 2020, 2021 and collapse the old LIAT.

“But at the end of the day we need sustainable air transportation in order to ensure reliable connectivity within the Caribbean region and I am of the view that LIAT could be salvaged and in fact we would have proven so because during the months of July and August, LIAT…operating one plane at a time would have turned an operational profit and it has over 11 individuals employed throughout the region”.

Asked by a caller about the reluctance of some regional governments in the past to get involved in the financing of the airline, Browne said this was due to a number of factors, including insularity and a culture of free loading.

“We are of the view that we should have a policy of shared burden, shared benefits, but unfortunately with some of these regional institutions, some countries are just looking for a free ride.

‘Antigua and Barbuda has its problems too…but we need to put some form of mechanism, perhaps automaticity of payments for these institutions to sustain them, otherwise we are going to find more and more of our regional institutions failing.

“We can’t have a situation which we continue to leave a small cadre of countries with the burden of our institutions,” Browne said, making reference to the financial problems facing the University of the West Indies (UWI) which be belives all countries should have some automaticity of payments towards.

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