After months of persistent grumbling and appeals to Government, former employees of the now defunct national airline, Ghana Airways, can now heave a sigh of relief as Parliament has approved a $5million commercial loan agreement between the Government of Ghana and Merchant Bank Limited to facilitate payment of severance awards and long service benefits, among other things.
Under the loan agreement, the bank will provide the aforementioned amount of money to be used by the government to pursue the liquidation of Ghana Airways, a lingering problem since its collapse in 2004.
The motion to approve the loan was moved by the Vice Chairman of the Parliamentary Select Committee on Finance and Member for Fanteakwa, Kwadwo Agyei-Addo, after he submitted the committee's report on the loan intended to facilitate the liquidation process of the airline.
Moving the motion for the loan"s approval, he said the committee was informed that part of the amount will be applied to the payment of severance awards to former employees who have been battling with authorities continuously over unpaid salaries and other benefits.
Although the loan has a one year tenure, it is subject to rollover which will prove immensely beneficial towards the resolution of the liquidation problems facing the airline.
When the loan agreement was laid before the House on November 8 2006, Anthony Akoto Osei, Deputy Minister of Finance and Economic Planning told Parliament that the defunct Ghana Airways Corporation owed its creditors $200m, $30m of which had been provided for in the government's 2007 budget to offset part of the debt. Meanwhile, total assets of the liquidated corporation were valued at between $7 and $8 million.
Negotiations between Ghana Airways and its former employees have been dragging on at snail's pace for years. The airline was established on 4 July 1958 and started operations on 15 July 1958, taking over the domestic and international services of West African Airways.
In late 2003, it suffered from DC-10 aircraft becoming inoperable due to maintenance obligations and as a result was forced to cancel a large segment of its long-range flights until it purchased two ex-Hawaiian Airlines DC-10 aircraft. On 28 July 2004, Ghana Airways was barred from flying to and from the United States for safety reasons. On 13 August 2004, members of the board of Ghana Airways were given their walking papers and tickets were no longer sold. The airline ceased all operations and has since been replaced by Ghana International Airlines, a private-public partnership, as the national carrier of Ghana.