Public Accounts Committee examines airport woes – $205m write-off for CAL

The content originally appeared on: Trinidad and Tobago Newsday

The Piarco International Airport – File photo

WRITE-OFFS, lack of staff, infrastructural woes and promises to improve local culture were some issues raised on Wednesday at the Public Accounts Committee (PAC) meeting in Parliament.

The purpose of the meeting was to examine the audited financial statements of the Airports Authority of Trinidad and Tobago (AATT) for the financial years 2013-2019 and to follow up on the implementation of the recommendations in the committee’s 18th report to the 11th Parliament.

Members also look at the challenges the authority faces in implementing the recommendations and try to find solutions. The hearing included representatives from the AATT, the Works and Transport Ministry and the Auditor General’s Department.

Oropouche West MP Davendranath Tancoo chaired the meeting and Jearlean John was the vice chairman.

Referring to the AATT’s submissions, they noted that the authority has significant receivables dating back to 2013.

Tancoo added that there were substantial debt write-offs and asked for details.

Caribbean Airlines (CAL) had the major write-off.

Financial comptroller Carmela Wallace-Shanklin explained that the Cabinet had approved a write-off for CAL of $205 million, representing debt to the authority from 2007-2019.

“That was basically for the rent of their hangar space and head office. Currently, our debt is approximately $72 million. Of that, 50 per cent (over $35 million) of it is collectable from CAL,” Wallace-Shanklin said.

“Our debtor days are currently 72, and our relationship with CAL has severely improved over the past couple of months in terms of their debt repayment. We expect that our $72 million in debt will be collected.”

The meeting was streamed live on the Parliament’s social media sites, including its YouTube channel (ParlView).

Tancoo asked about the authority’s compliance with the Public Procurement and Disposal of Public Property Act. He also asked about its strategic planning and risk management in the industry.

AATT general manager Hayden Newton responded it is fully compliant with the Office of Procurement Regulation provisions and the public procurement legislation.

The authority developed its “special guidelines” and is in the process of ensuring that it receives the necessary approvals.

He quoted from AATT’s submission that the cost of developing its strategic plan for 2014-2017 and 2018-2022 was about $500,000 and asked for a breakdown of each component.

Newton replied he did not have the breakdown.

Tancoo asked about the authority’s track plan for 2023 into 2024.

Newton said the 2018-2022 plan has been rolled over to 2023, owing to the pandemic and several unmet targets. It is working on a 2024-2029 plan.

“We have done internal work in terms of preparing, and we are at the stage where we would have done sufficient work to get an international facilitator to assist us in finalising that plan,” Newton said.

He promised to facilitate the committee with details on the targets which were rolled over.

Tancoo quoted the authority’s submission that cyber security is critical, cyber risks are changing, and that the authority must keep up with the newest security reinforcements and lessons from previous hacks.

He then asked if the authority had experienced any cyber issues, to which Newton responded it had not.

AATT deputy general manager (security) Col Albert Griffith assured preventative measures were in place, adding it has established a cyber security governance committee.

John also referred to AATT’s document, which said it has several vacancies.

She also enquired about the possible impact on operations.

Newton replied that the authority was trying to fill the vacancies.

She asked about the availability of spaces for rent at the airports.

He said there are spaces, and recently, the authority put out a request for proposal.

He added some of the spaces were new, while others were because tenants had moved out.

AATT deputy chairman James Philbert said the strategic civic significance of the two airports goes beyond mere transportation stations. He added the airports are multipurpose commercial centres, vital engines that stimulate national economic growth, facilitate trade and promote global engagement. The airports are catalysts for tourism, trade, and investments and play a pivotal role in the nation’s progress.

He cited the covid19 pandemic, saying it posed unprecedented challenges like the borders’ closure, which caused a decline in aeronautical and non-aeronautical revenue.

Philbert said: “The agility and resilience of the organisation enable us to respond positively and ensure continuous operations.

“We lost more than 95 per cent of all revenue. Today, we are on a new route to robust recovery. Passenger throughput is back up to 90 per cent of pre-covid figures.”

The authority’s strategic focus, he said, is to improve infrastructure, ensure operational efficiency, facilitate and attract new business, and maximise aeronautical and non-aeronautical revenue through superior business processes, systems, tools and people.

“At the end of fiscal 2023, the authority ended with a surplus (operating) of $2.8 million, before interest, taxes, depreciation and amortisation, which represented a significant achievement given the severe deficits in three prior years,” Philbert said.

Committee member Hazel Thompson recalled a recent trip and praised airport staff, saying they were efficient.

But Tancoo shared an opposite perspective, saying clearing immigration and customs and excise officers was lengthy.

Newton said both responses were valid as there have been some inconsistencies, and the authority is working with both agencies.

“It has been a situation where we have been trying to use moral suasion and try to assist even with respect to personnel. Sometimes we are told, ‘None of your business’.”

“The fact is that it is a challenge for us that we, as the providers of the key service in the airports, have a problem with the inconsistency in terms of what happens at the border control, with both immigration and customs.”

Newton was also asked about activities to promote local culture and generate revenue at airports.

Newton responded that the authority has a plan for 2024 to have artists exhibit their works in the Piarco airport.

Committee member Ayanna Webster-Roy commented that many products sold at the airports are not locally produced but made in China.

She also raised concerns about the toilets’ state and called for improvements.