ON May 22, an Airbus belonging to PIA met with a fatal crash in Karachi. This incident started a national debate on PIA’s flight safety standards and the Civil Aviation Authority’s (CAA) ability to regulate the civil aviation sector in Pakistan.
Even the safest airline can have a plane crash under the supervision of the most competent regulator. However, PIA has a history of crashes and near misses. Before the fatal crash in May, in January and March 2020, two mid-air collisions were narrowly avoided in Pakistan’s airspace.
PIA’s precarious financial position is nothing new, and we have now become accustomed to seeing the government administer large financial injections to PIA each year to keep it afloat. But it is a huge embarrassment for Pakistan when foreign law-enforcement agencies regularly recover drugs from PIA employees or aircraft around the world. In 2013, a PIA pilot was imprisoned for nine months in the UK for consuming alcohol beyond legally permissible limits before flying.
This writer does not claim to be an aviation expert but has attempted to critically examine Pakistani civil aviation’s legal regime in the light of certain basic principles of administrative law and some generally recognised concepts of corporate governance. This piece argues that the legal regime of civil aviation in Pakistan is inherently defective, and any meaningful improvements in PIA and the CAA are impossible unless substantive changes are implemented in the underlying legal regime.
Are these not major debacles that call for accountability of the directors on the boards of the CAA and PIA?
Under the rules of business, the aviation division is, inter alia, responsible for the development of civil aviation, safety of air transport and PIA. The CAA is the regulator of the civil aviation sector in Pakistan under the Pakistan Civil Aviation Authority Ordinance, 1982. PIA is a limited liability company and a licensee of the CAA.
Independence is the hallmark of an effective regulator. A regulator should be independent of the government and the industry that it regulates. This, unfortunately, is not the case with the CAA. Under the CAA Ordinance, the federal government has the authority to issue binding policy directives to the CAA.
The secretary, aviation division, acts as the chairman of the CAA’s board. Four federal secretaries, the sitting vice chief of the air staff, and PIA’s managing director sit on the CAA board. To further solidify control, as of 2018, the secretaries, aviation division, are also holding the additional charge of acting director general of the CAA. It should, therefore, not surprise anyone if the CAA’s performance is not up to the mark as the regulator has not even had a full-time DG since 2018 and works under a board which solely consists of the civil and air force bureaucracy. Neither the acting DG nor any of the CAA’s board members is an expert in civil aviation — being an expert in civil aviation is not even a requirement for holding these positions under the CAA Ordinance.
The most powerful man in Pakistan’s aviation sector is Mr Hassan Nasir Jamy. He is the secretary, aviation division, chairman of the CAA board, acting DG of the CAA since December 2019 and a director on the CAA and PIA boards. He is from the Pakistan Administrative Service (PAS) with an MBA, an MA in rural development, and a fellowship from the US in public policy. Before the aviation division, he worked in the climate change, petroleum and water & power divisions. He was secretary, local government, in Punjab. What is the relevance, if any, of Mr Jamy’s education and experience to the posts he is currently holding? A board of directors is appointed for a reason. Every important issue facing the entity must come before the board. The directors are deemed the trustees of the entity’s assets. Above all, the directors should be clear of all conflicts of interest. In the case of a dereliction of duty, a director can be held personally liable.
The four federal secretaries on the CAA board represent the federal government, which has its own political considerations and pressures. Would they safeguard the interests of the federal government that appointed them or the interests of the CAA? Again, whose interests will the MD/ CEO of PIA be watching? Clearly not those of the CAA!
A disaster in a company gets attributed to its board, which is responsible for all important matters. This responsibility and the corresponding legal liability oblige the directors to act responsibly in performing their duties. The PIA crash in May and the banning of PIA in Europe, initially for six months, by the European Union Aviation Safety Agency (EASA) — are these not major debacles that call for accountability of the directors on the boards of the CAA and PIA?
The federal government has the authority to order an inquiry. Can the CAA conduct a free, fair and transparent inquiry when the secretary, aviation, is its acting DG, chairman of the board and a director of the CAA and PIA? A dereliction of duty may also be ascribed to the other directors on the CAA board. There is indeed accountability in the armed forces of Pakistan but no federal secretary belonging to the PAS has ever been charged and convicted so the chances of accountability at the required level in the CAA and PIA are next to none.
The EASA’s most damaging letter concludes by stating, “EASA therefore no longer has confidence that Pakistan, as the state of operator, can effectively ensure that operators certified in Pakistan comply at all times with the applicable requirements for crew qualification …”
Pakistan is paying a heavy price for the incompetence of those at the helm of affairs in civil aviation. The banning of PIA in Europe is just one example. How long will we continue to humiliate ourselves only to keep a few happy?
The writer is an advocate of the Supreme Court of Pakistan.
Published in Dawn, July 6th, 2020