By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Bahamasair's chairman yesterday said that while there had been no formal discussions with government on staff salary deferrals, "nothing is off the table" as the airline seeks to drastically cut costs.

Tommy Turnquest confirmed to Tribune Business that the government had yet to raise the matter with it, adding of the prime minister's comments in the House of Assembly: "I heard it just like you."

The national flag carrier's chief responded after Dr Hubert Minnis suggested that Bahamasair may have to defer salary payments to some or all of its roughly 700-strong staff after it lost its US and Freeport routes due to the latest lockdown restrictions imposed by the government.

"As government we have some very difficult decisions to make," the prime minister said during the debate about extending the existing state of emergency until September 30. "Around the world as airlines are parked, not flying, airlines are filing for bankruptcy. Bahamasair is supported by the Government and the people of The Bahamas, yet its staff are fully paid yet (there is) no work.

"I spoke to my colleagues this morning in the Caribbean, and at some point in time we will have to make a decision, and I'm not saying we're doing that now, but at some point in time (we will have to make a decision about) whether Bahamasair staff who are sitting there and the aircrafts who are sitting there, should we pay them a percentage of their pay? Let's say 70 percent and defer the other 30 until things have changed."

Dr Minnis continued: "Barbados was successful in issuing what they call compulsory bonds and keeping everyone employed. I don't believe in laying off, but (Barbados) is reducing their salary by a higher percentage and that bond is paid back to them over an 18-month span, but with the compulsory bond they are guaranteed their salary. At some point in time we will have to make that decision.

"Whether we follow what is happening around the world with mass lay-offs, which causes serious problems -- so I have issues with that -- as opposed to reducing individuals' salary, deferring a potion of their salary, but they're guaranteed it until our pandemic is resolved and our economy starts to grow.

"The nation must always come first. Politicians would be afraid to make such decisions because of possible outcomes, but sometimes as politicians we must make difficult decisions in the interest of the nation or we all drown. At least give the nation an opportunity, the future generation an opportunity to swim and become best swimmers of the world."

Salary deferrals would mean Bahamasair staff would only receive a portion of their regular pay cheque, with the balance deferred to a later date when border restrictions are removed and the airline resumes a full flight schedule. But implementing any deferrals will likely run into significant opposition from both workers and their trade unions.

Mr Turnquest confirmed, though, that the national flag carrier has little choice but to implement cost-cutting measures after all its US routes - as well as services into Freeport - were shut down earlier this week to help the Government get a grip on COVID-19.

"Nothing is off the table. By that I mean we have to look at everything," he told Tribune Business. "I'm going to tell you we have to look at everything."

Mr Turnquest, though, declined to detail the measures Bahamasair may be exploring, adding: "I'll have discussions with the Government, discussions at Board level, discussions with the management, and then they'll have discussions with the union. I don't want to pre-empt any of that. He indicated, though, that there were no plans for terminations or staff downsizing.

Tracy Cooper, the national flag carrier's managing director, told Tribune Business that Bahamasair's jet fleet had been grounded by the suspension of the Florida routes. "We've lost the whole of the last financial year," he added, referring to COVID-19 and Hurricane Dorian. "It's been devastating for the airline.

"Obviously we're going to have to make some adjustments. We're looking to see what measures we will have to take. There will have to be some material measures. What those are, we're discussing internally to take into consideration the further reduction in revenues."

Bahamasair previously estimated that it lost $10.5m as a result of its near-three month COVID-19 shutdown earlier in the year, as it was forced to cover staff salaries and other overheads on zero revenue income. That, together with an $8m loss from Dorian, translates into a total $18.5m hit that will be felt in the results for its just-closed 2020 financial year.

"In the financial year ending on June 2019, our revenues were $92m," Mr Turnquest told Tribune Business earlier this week. "This year it's going to be around $70m." The latest lockdown, coming just three weeks into the airline's new financial year, means the COVID-19 direct impact will also be felt in its 2021 financial results for at least the first quarter.

With taxpayers already pumping an eight-figure sum annually into Bahamasair to keep it flying prior to COVID-19, Mr Turnquest said "you don't have to be a rocket scientist" to realise that a further cash call on the Public Treasury beyond the $19m provided in the 2020-2021 budget will be forthcoming.