Cathay Dragon Traffic Rights Are Up In The Air: Govt

The government made it clear on Monday that Cathay Pacific won't necessarily be given the traffic rights previously held by its now-defunct subsidiary Cathay Dragon.

The Legislative Council held a special meeting to discuss the aftermath of the flag carrier's massive restructuring programme announced last month, which included the axing of Cathay Dragon and 5,300 locally-based jobs.

Finance sector lawmaker Chan Chun-ying asked officials to address speculation that the traffic rights freed up, including the mainland routes that Cathay Dragon operated, would be handed to the flag carrier.

A deputy secretary for transport and housing, Wallace Lau, pointed out that any Hong Kong-registered airline could apply for the routes through his bureau.

"Our main considerations include whether [our decisions] can promote healthy competition, whether it's beneficial to Hong Kong's status as an international aviation hub, a well as the overall development of the local aviation sector," said Lau.

Lawmaker Jeremy Tam said he expects Cathay will not get back all of the routes it used to operate through its Dragon brand.

"I think all the airlines will apply for some of the routes that's for sure," said the Civic Party member.

Tam also noted that the government is in no hurry to release those rights because of all the travel restrictions forced by the Covid-19 pandemic.

"Technically, the government can hold on to those rights and leave it until next year," he said

"And maybe wait for the Greater Bay Airlines to establish and some of the rights go to them," Tam added, referring to mainland tycoon Bill Wong's earlier remark that he plans to fight for Cathay Dragon's routes if his new carrier receives approval to operate in Hong Kong.

Tam urged the government to factor in whether airlines applying for the rights would give priority to Hong Kong people when recruiting staff.

He moved a motion during the meeting calling for this, and it was backed by more than half of the lawmakers present.

Cathay Pacific's treatment of its staff also came under the spotlight during the Legco meeting, with lawmakers criticising the government and carrier over the handling of those who managed to keep their jobs.

More than 90 percent of pilots and cabin crew have agreed to new contracts that come with significant cuts to pay and benefits, after their unions unsuccessfully attempted to push back a 14-day deadline for signing.

"The conditions of service that the staff have signed on to themselves will not be reviewed, the conditions of service are a framework of a contract which will remain in place," said Cathay Pacific chairman Patrick Healy, after lawmaker Wong Ting-kwong asked if there are plans to improve pay and benefits when the airline's business picks up.

But he added that the contracts also include variable factors that can mean more pay when flights resume.

"The more people fly, the more they will earn," he said.