Task Force Formed to Solve PAL’s woes

Today
Monday, August 31, 1998

PRESIDENT Estrada has formed an interagency task force headed by Finance Secretary Edgardo Espiritu to settle once and for all the labor problems at the Philippine Airlines (PAL) and to look for "long-term solutions" on its financial woes.

Espiritu said late Friday that the task force would also try to come up with measures to protect the national flag carrier from unfair competition in the deregulated airline industry.

He said his group was given only a week by the President to finish the task. Estrada issued an administrative order creating the tax force which states that "the national interest requires that there should be a wholistic, creative and innovative approach to solve the problems of PAL."

Besides the Department of Finance, the task force includes officials from the Departments of Labor and Employment, Transportation and Communication, Foreign Affairs, and Tourism and the Securities and Exchange Commission.

In a meeting with Estrada last Friday, Espiritu said the President "was concerned that the impasse at PAL was taking too long and decided that the government should take a more active role in helping resolve the problem."

Espiritu justified the government decision to intervene in the labor-management dispute at PAL as well as in finding solutions to its financial problems, citing the equity held by government financial institutions in the airline and the negative impact that the pilots' strike and subsequent downsizing of its operations have had on the economy.

He said the task force would meet first with PAL labor unions, and then with management and finally with all the parties together, starting today to resolve problems besetting the company.

The Government Financial Institution and state-managed financial agencies with equity exposure in PAL are Philippine National Bank, Land Bank of the Philippines, Government Service and Insurance System and the Social Security System.

Control of PAL is with tycoon Lucio Tan, widely believed to be Estrada's biggest financial supporter for his Presidential campaign last May. E. de la Cruz