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‘Pilot greed’ a reminder of why Cyprus Airways collapsed, Georgiades says

Cyprus Airways

Criticisms surrounding the liquidation process of now defunct Cyprus Airways are a staunch reminder of the mismanagement that ruled the company for years and eventually led to its demise, Finance Minister Harris Georgiades said on Thursday.

He was commenting on accusations by former Cyprus Airways employees a day after the liquidation process came to an end, leaving some quarters disgruntled.

On Wednesday, 98.6 per cent of 325 former employees of the defunct air carrier, voted in favour of a settlement plan outlining how €11m would be disbursed to creditors.

The liquidator Avgoustinos Papathomas said €6.4m would go the state and €4.6m to former employees who were subject to pay-cuts during their tenure at Cyprus Airways. The settlement plan will be submitted to Nicosia district court on January 19 for ratification where any objections can be filed.

Responding to criticisms on Thursday, Georgiades said the state had paid former employees “significant compensation when it had to because they were losing their jobs.”

The carrier did not have the funds to compensate the former employees as it already owed millions it couldn’t pay back and thus the government stepped in to give the money to those who lost their jobs to help them out and was now receiving the money back as part of the liquidation process.

A former pilot of defunct Cyprus Airways Chrysanthos Hadjichrysanthou speaking on Cybc’s morning show however called it “unethical” and said “I don’t know anyone that gives compensation and asks for it back,” while at the same time, President Nicos Anastasiades wrote off a €20m debt football clubs owed to the state.

He argued that the €6.4m the state would be receiving as part of the liquidation should instead go to the former staffers.

Pilots, who had a separate fund from that of all other former employees “were sorted out just fine” Georgiades said.

Their reasoning is that they would have preferred the state had not stepped in to compensate the former employees so that during the liquidation process, the pilots could have received more money, the finance minister added.

This was unacceptable and listening to the pilot was reminiscent of the mismanagement that ruled Cyprus Airways for years, Georgiades said.

“Thankfully, the closing down of Cyprus Airways caused no problems to our economy. On the contrary, air connectivity has improved, fares have decreased, new airlines began operating and new jobs have been created.”

Georgiades also said he was glad that most of the former employees had found jobs in their respective fields.

The liquidator had amassed €21.6m in income since the liquidation process began in early 2015. Divestment came to €8m with an additional €2.5 expenses leaving just over €11m to distribute amongst creditors.

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