Financial problems could be the reason behind the cancellation of two Pelangi Airways flights last Saturday which left 60 passengers stranded at the Sultan Abdul Aziz Shah Airport in Subang.

Pelangi Airways business development manager, Tengku Mohd Affandi Tengku Abdullah when contacted today conceded that the company is facing financial problems.

"Airline companies, even Malaysian Airlines, are facing financial difficulties after the economic crisis (in 1998)," he told malaysiakini .

According to Mohd Affandi, the US dollar appreciation (from RM2.50 to RM3.80 per US dollar) and the hike in oil prices have increased the operating cost of the company.

"Our revenue is mostly in ringgit or in rupiah (Indonesian currency)," he added.

He explained that the company has to pay for the aircrafts' maintenance, spare parts and fuel in US dollars.

"Unlike Malaysian Airlines which is backed by the government, private airlines like Pelangi, have to find their own solutions," he lamented.

On Sunday, The Sun reported that the flights were cancelled because its pilots are holding a 'silent strike' against the management.

However, Mohd Affandi denied there was a strike saying that one flight was cancelled because the pilot was on medical leave and while the other cancellation was due to insufficient cabin crew.

Employee grouses

Meanwhile, asked to comment on employee morale in the wake of this 'financial crisis', Mohd Affandi said, "The airline has the best staff who have been supportive and helpful to the company since the economic downturn."

An employee of the company, however, painted a different picture and accused the company of "breaching labour laws by delaying and not paying salaries to the staff".

The source who declined to be named claimed the airlines had not contributed to the Employee Provident Fund since late 1997 and has not paid overtime and allowances since June this year.

"Some of the staff cannot even afford to buy food for their families," he complained.

A complaint was filed with the labour department but no action has been taken so far, he added.

The employee also claimed that the management was lying in denying there was a 'silent strike'.

"They're lying. They know why everyone is on medical leave," he said.

The staff agreed not to stop working when the management decided to pay half of last month's basic salaries and June's allowances by the end of this week.

"The problem is not solved. Anytime there can be a silent strike," he said, adding that tension among the staff is now "very high".

'Affected differently'

Commenting on these claims, Mohd Affandi replied, "Different people are affected differently by the situation. We'll solve one by one."

Pelangi Airways has between 200 to 300 employees including pilots, flight crews and administrative staffs. Unlike the employees in Malaysia Airlines, there is no in-house union representing them.

A Berita Harian report yesterday said the biggest shareholder in the company is Yayasan Islam Terengganu with 31 percent stake.

Other shareholders are Naluri Berhad (20.65 percent), Perbadanan Kemajuan Negeri Selangor (20.44 per cent), Mambang Di Awan Sdn Bhd (8.23 percent), Perbadanan Kemajuan Negeri Perak (6.95 per cent), Syarikat Kemajuan Negeri Melaka (6.07 percent) and TDM Berhad (6.07 percent).