Vol. 5 Num 1054 Sun. May 20, 2007  
Front Page

Steps to make Biman PLC by June approved

The Council of Advisers yesterday approved some steps to turn Biman Bangladesh Airlines into a Public Limited Company (PLC) by June.

It asked the ministries concerned to prepare a phase-by-phase programme to make the huge loss-incurring national airlines into a profitable organisation.

At its weekly meeting, the council approved in principle a proposal to review Biman's possible manpower cut, audit its current financial state and sketch out alternatives to its fuel purchase arrangements with Bangladesh Petroleum Corporation (BPC).

Earlier on April 25, the caretaker government had decided to turn Biman into a PLC within June under a re-structuring plan. A high-powered committee headed by the secretary of the civil aviation ministry in March made recommendations to this effect.

The national flag carrier now has a 4,800-strong manpower.

According to the government plan, Biman will have to undergo internal reforms before it becomes a PLC with 100 percent state ownership and its shared would be offloaded to the private sector once the company becomes profitable, Chief Adviser's Press Secretary Syed Fahim Munaim told newsmen yesterday.

Meanwhile, Biman will slash its manpower under a Voluntary Retirement Scheme (VRS) and a revised organogram. It is also going to change its rules of business, highly placed Biman sources said.

As a PLC, Biman will be owned by at least seven public organisations through floating of shares.

A company board would be formed comprising these organisations that will take all decisions regarding Biman.

Biman is also planning to buy new generation aircraft as part of its re-structuring.

A private operator will be appointed to run the airlines on a commercial basis, said the source.

Talking to The Daily Star recently, Managing Director (MD) of Biman MA Momen said,

"We have 13 aircraft (seven of those now in operation) now and 4,800 staff. So, the excess manpower will have to be reduced."

He said, "Under the VRS, those who have completed 25 years of service would be asked to retire."

But Biman will try to ensure that its skilled officials and employees do not go into retirement under this scheme.

Implementation of the VRS scheme will require Tk 300 crore, and the World Bank has already given this amount to the government, sources said.

"We are trying to bring Man-Equipment Ratio (MER) [ratio of aircraft to manpower] of Biman to a reasonable level to reduce its expenses by 40 to 45 percent," said the Biman MD.

Biman's MER at present is 1:367 while the acceptable ratio is 1:200.

Singapore Airline's MER is 1:152, Malaysian Airline's MER is 1:146 and Emirates' MER is 1: 294.

About the proposed organogram and rules of business, Biman officials said working system would be made more computer oriented. "No helping hand (like personal secretary) would be provided for high officials anymore," one official said.

Biman now has Air Service Agreement (ASA) with 42 countries, of which it uses only 18.

"After becoming PLC, Biman will take all initiatives that a commercial organisation or a PLC takes," the MD said.