KUALA LUMPUR (Nov 4): Malindo Air has denied pocketing Socso benefits as alleged by certain quarters and clarified that whatever sums it received from the Social Security Organisation (Socso) were fully disbursed to its employees.
In a statement today, Malindor Air said that under the Employment Retention Programme (ERP), it received a total of RM1.27 million for April 2020, which was credited in mid-May 2020 from Socso and disbursed to 2,112 staff.
It said another RM1.49 million was received in late June 2020 and credited to 2,478 staff accordingly.
The airline said that subsequently when Socso discontinued the ERP and replaced it with the Wage Subsidy Programme (PSU scheme), only 196 staff benefitted from the same.
Malindo Air said a total of RM235,200 was received for the months of June and July 2020, which Socso only disbursed in late August and September 2020 respectively.
“Nonetheless, Malindo Air has ensured that the staff who benefitted from both the schemes were retained for more than three months as per their governing rules,” it said.
Malindo Air said prior to the Covid-19 pandemic, its average monthly revenue was RM200 million.
It said this supported a payroll of 5,000 personnel amounting to RM40 million a month.
Malindo Air chief executive officer (CEO) Capt Mushafiz Mustafa Bakri said the pandemic, which resulted in the grounding of almost all of its fleet since March, has had a crippling effect on finances with current average revenue being just 7.5% of pre-pandemic levels.
“How do you continue to maintain the status quo eight months and still counting, when there is barely any revenue or meaningful support of any kind?” he said.
Malindo Air said given the huge erosion of its cash flows due to the Covid-19 pandemic, the airline had to undertake a massive cost-cutting exercise in order to remain afloat.
Malindo Air downsized its fleet by 50% by transferring out 20 aircraft.
It said this resulted in monthly savings of about RM20 million.
The airline said that it had sought deferments and renegotiated contracts with a vast number of service providers, including aircraft lessors and airports.
Malindo Air stressed that despite having taken numerous steps such as a a voluntary separation scheme (VSS) for 349 of its staff and a long-term unpaid (LTU) scheme for 439 of its pilots and cabin crew, with no immediate prospect of restarting its regular operations, the airline now has to resort to retrenching 1,861 staff in order to remain in operations.