Showing posts with label business. Show all posts
Showing posts with label business. Show all posts

Friday, July 3, 2009

Are our Friendly Skies ... Safe?

UPDATE: ST Aerospace President Tay Kok Khiang has responded to my query on the legitmacy of the claims. Here is his response (emphasis are mine):

Thank you for your interest and feedback.

You are assured that the allegations being made by the wfaa are untrue. We have the highest regard for safety of our products and would notcompromise that. Our customers are also fully aware of our exacting qualitystandards and are with us.

Have a good day.


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In lieu of the tragic Air France and Yemeni air crashes, aircraft safety is very much in the foreground of our thoughts as we embark on holidays or send love ones of at the terminal.

When I spoke of my concerns to a relative that was flying off to London, she confidently replied that if iwas scared I should just pay more and fly SQ. I felt reassured then, but now I am not so sure.

In an age of globalisation, the only thing that spreads across national borders faster than information and goods, is greed and incompetence.

I saw the article attached below in the 3in1kopitiam Forum and needless to say i was dissappointed. In a nut shell, aircraft mechanics, yes the ones supposed to do the safety checks, were being 'imported' into the US by companies that are subsidiaries or direct entities of ST Aerospace, a company of ST Engineering. And in order to cut costs and maximize margins, their qualifications, such as their ability to read the english instruction manuals, are being overstated.

I am not well informed enough to known the level of direct involvement of ST Aerospace in this hiring policy, but I do think they have a responsibility to respond and clarify their position.

I will be sending this post to the ST Engg management, Our Labour Chief and to The Press

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Aircraft repair jobs sold to foreign workers, resumes not important
02:12 PM CDT on Wednesday, July 1, 2009
By BYRON HARRIS / WFAA-TV

A News 8 investigation found that hundreds of aircraft mechanics have been brought into the United States to work at aircraft repair facilities.

Insiders say the companies that are importing the mechanics are so eager to save money, they’re overstating their qualifications. The result may be a threat to safety, abetted by lax enforcement of immigration law.

At daybreak any morning at San Antonio Aerospace, hundreds of workers amble through the gates for the day shift. They repair big jets like Airbuses, Boeing 757s and MD-11s. But, despite the fact that it's a huge facility in the middle of the San Antonio International Airport, a large number of the mechanics are only temporary workers from foreign countries.

News 8 found they’re from Mexico, the Philippines and Chile, among other places. They have been brought specifically to the United States to work for San Antonio Aerospace (SAA). News 8 followed a special bus San Antonio Aerospace, used to pick up foreign workers every morning. Workers riding on the bus were from the Philippines. The workers, who wouldn’t say how much money they make, are part of a stream of imported mechanics brought to this country at cut-rate wages, according to several sources familiar with the business.

Jada Williams used to work for one of the contracting companies, Aircraft Workers Worldwide (AWW), based in Daphne, Alabama. AWW supplied workers for two facilities, Mobile Aerospace Engineering (MAE) in Mobile, Alabama and San Antonio Aerospace, which are both controlled by ST Aerospace. San Antonio Aerospace is a division of ST Aerospace, the largest aircraft repair company in world.

"They’ve employed over 200 since I left,” said Williams, who said she was unfairly fired by the contractor last fall. "And I know we had over a hundred when I was in there, just in Mobile.”
She said in San Antonio, AWW supplied 600 workers. The workers stay in the United States and come from various countries because of the different kinds of visas available in those places.

San Antonio Aerospace uses several contracting companies to supply it with workers. It can be a high-profit business for the contractors. They can make $3 to $12 an hour for every worker hired by SAA, contractors say.

The drive for profits is so big, Williams and other insiders said, that the contractors often falsify the qualifications of the imports.

"We had two,” she said. “One of them was a female. She was about 16. It was a brother and a sister. One guy was a grocery bagger, one was a security guard in Puerto Rico. Their ages were between 18 and 22.”

Their ages are important because it takes years of experience or schooling to learn how to repair a big jet, experience they couldn’t have had.

"There had been padded resumes at SAA before,” said an administrator at another contractor. “That’s why another contract house was kicked out (of SAA).”

One former SAA mechanic, who spent years learning his trade before being laid off, said foreign workers got their training on the job from the Americans they worked with.

"The more experienced mechanics, we would get paired up with either one or two of these guys,” he says. “And they would watch us for a month or so. And that’s how they would get their training.”

Williams is suing her former boss, Daniel Harding, for unlawful termination and racial discrimination. She has a computer full of company documents that were acquired accidentally when AWW got new computers for its office and gave her an old one. Spreadsheets, resumes and payrolls revealed many company practices, from interviews, to trips to the U.S. Embassy in Mexico City for visas, charts marked the progress of Mexican workers to the United States. Documents also showed workers were charged $3,500 each by AWW to get into the United States.

Williams also has an e-mail trail from AWW president Harding to Moh Loong Loh, the President of San Antonio Aerospace. He described one candidate as having “ 25 percent English skills.” Workers need English to communicate with their supervisors and to read repair manuals, so this is a key safety issue. American SAA workers said many imports cannot speak English at all.

In another e-mail, Harding described a group of imported workers from Mexico, just like a commodity.
“I hope to be able to bring increments no larger than ten at a time,” he wrote to Loh.
While this was happening, SAA former wokers said they got laid off.

WFAA-TV The companies involved may face serious questions, said a former judge.
“I feel like we are being betrayed in our own country,” said one who was terminated. “And I feel it is not right.”

“These big layoffs of 20 to 30 people would go out,” said the contract administrator. “The very next Monday, 30 or 40 [imports] would be coming in.”

Williams said in Mobile the numbers were even bigger. She said she picked up a group of 60 people from Puerto Rico at Mobile Regional Airport last February. Since Puerto Rico is a U.S. territory, its residents are U.S citizens. For the contractors, this is a bonus because they can pay the Puerto Ricans low wages without having to deal with foreign immigration requirements.
When the FAA came to inspect San Antonio Aerospace, the company got a one-hour warning, said a former employee.
“And a lot of guys who were not able to read English, they would hide those guys or send them home for the evening," the former employee said.

News 8 submitted written questions to both SAA in San Antonio and MAE in Mobile. The questions asked how many foreign workers they employ and what they are paid. The response from each said “we are an equal opportunity employer.” Another question was whether AWW is owned by ST Aerospace. The terse answer was no, “AWW is an independent contractor.”
AWW did not respond to questions. An attorney retained by the company and Daniel Hardin said “Mr. Hardin is a responsible businessman who has greatly benefitted his community and his country.”

In Dallas, former judge David Finn, now in private practice, told News 8 that all the companies involved may face serious questions.

“Federal prosecutors would probably look at making false statements, material false statements," he said. "That’s a federal offense, a felony ... Mail fraud, wire fraud, there are any number of statues on the books that would apply to a situation like that.”

Wednesday, November 19, 2008

MAS and Stat Boards invest in credit-linked notes as well

The ST article below highlights comments by Finance Minister Tharman regarding stat board investment exposure to credit-linked notes.

He did not reveal the identity of the 5th stat board, except to admit after questioning from NMP Siew Kum Hong that, "a fifth unnamed statutory board had financial products linked to CDOs and CDS, aside from credit-linked notes"

I think everyone would also like to know the name of that 5th stat board. Whats there to hide afterall? Because of this secrecy, I am left to speculate its either the CPF board, Public Transport Council, HDB or People's Association.

Thats the real problem with this whole crisis; too much secrecy.

Yes, yes, the 4 stat boards invested in credit-linked notes but these were not the ones that have experienced a "credit event". Should I be happy for them?

Just because they have yet to experience a "credit event" does not make them sound investments in the first place, as recent history suggests. But rather then to nitpick on investment choices and say "you should have known better", I have a feeling that everyone who is directly or indirectly affected by bad decisions and advice are more upset over the overall secrecy shrouding the issue.


Nov 19, 2008
5 stat boards' investments
http://www.straitstimes.com/Breaking%2BNews/Singapore/Story/STIStory_304115.html

THE Monetary Authority of Singapore (MAS) - Singapore's central bank and financial regulator - was among five statutory boards that invested in complicated credit-linked notes.

But none of the statutory boards - including the MAS - invested in notes that have now become worthless, such as DBS High Notes 5 and Merrill Lynch Jubilee Series 3 LinkEarner Notes.

The central bank had invested only 0.1 per cent of its portfolio in such investments, which in fact made a net gain over the past year.

A Ministry of Finance (MOF) spokesman, who revealed this to The Straits Times yesterday, did not give the actual size of the investment.

He was responding to queries after Finance Minister Tharman Shanmugaratnam told Parliament that five statutory boards had invested in credit-linked notes, but only named four: Singapore Civil Service College, Singapore Land Authority (SLA), Infocomm Development Authority of Singapore (IDA) and Professional Engineers Board.

Mr Tharman had emphasised in Parliament that the four boards had invested in credit-linked notes, but not the ones which have gone into default or suffered credit events that have caused their value to plummet to zero and triggered early redemption.

The notes that have suffered this fate include Lehman Minibonds, Merrill Lynch Jubilee Series 3 LinkEarner Notes, DBS High Notes 5 and Morgan Stanley Pinnacle Series 9 and 10 Notes.

Although he did not provide the actual amount invested by each of the four named statutory boards, he said that the exposure as a percentage of their total combined investment portfolio was only about 0.05 per cent.

These investments are currently suffering paper losses of about 14 per cent over the past year, he added.

'On a mark-to-market basis, these credit-linked notes held by the four statutory boards have not performed very differently from the performance of global markets generally this year,' he said.

'The four statutory boards are nevertheless monitoring the situation on all their investments, and will take the necessary steps to minimise any losses in these investments.'

MOF later told The Straits Times that the four statutory boards have had positive returns on their overall investment portfolios this year, averaging about 2 per cent.

And for the past three years, the average annual return on their investment portfolios had averaged 3 per cent.

Mr Tharman was responding in Parliament yesterday to questions from Non-Constituency MP Sylvia Lim, who asked whether statutory boards had invested in risky structured products which were linked to bankrupt United States investment bank Lehman Brothers.

Nominated MP Siew Kum Hong also wanted to know if those investments were linked to collateralised debt obligations (CDO) or credit default swaps (CDS), which are both complex investment products at the centre of the global credit crunch.

It was in response to Mr Siew's question that Mr Tharman revealed a fifth unnamed statutory board had financial products linked to CDOs and CDS, aside from credit-linked notes.


'These products comprise around 0.1 per cent of the statutory board's portfolio, and have in fact made a net gain over the year,' he added.

On how and why these statutory boards invest, Mr Tharman explained that all of them keep some surpluses for 'future capital expenditures and as a buffer against unanticipated spending needs or budget shortfalls'.

'They manage and invest these funds in financial assets to earn an appropriate return within acceptable risk limits, after taking into account their cashflow and liquidity needs,' he added.

According to Mr Tharman, statutory boards also have to ensure they have appropriate investment management structures for proper oversight of its financial investments with prudent risk management.

Wednesday, October 8, 2008

Changi Airport Corporatisation: from the hand that swipes the ass to the hand that digs the nose

It was recently announced that Changi Airport will be ‘corporatised’ by July next year in a bid to boost its status as a leading aviation hub. In this move, “a new company will undertake the operational functions of managing Singapore's airport, including its emergency services and investments in foreign airports.”

These functions are currently handled by entities that are wholly-owned subsidiaries of the Civil Aviation Authority of Singapore (CAAS). CAAS, the regulator of the aviation industry, is a statutory board under the Ministry of Transport.

In this ‘corporatisation’, we will see the creation of two entities – a regulator and an airport operations company.

Notice I keep using air quotes for the term corporatisation. I do this because this development seems more like governmental restructuring rather than corporatisation as is generally understood (the transfer of the running of state apparatuses to the private sector). I say this because:

a) This “new company” is in fact a segment of the business that has changed ownership from a statboard (CAAS) to a sovereign wealth fund (Temasek) whose sole shareholder is the Minister for Finance.

b) Soon, the company that manages the airport and invests in foreign airports will be fully owned by a company (Temasek) that is the parent company of Singapore Airlines.

c) The current chairman of CAAS (Mr Liew Mun Leong ) will move across to helm this “new company”.

d) Taking his place will at CAAS will be Mr Lee Hsien Yang (brother of our Prime Minister who recently stepped down from his post at Singtel). He is also the brother-in-law of Temasek head, Ho Ching, who now owns the company that has split from the regulator.

e) The Government assures all that these steps are not part of a cost-cutting measure. “Instead of lay-offs, the combined entities will be hiring more staff. Furthermore, one key reason for corporatisation is to allow the company greater flexibility in paying its top talents more.”

So all-in-all what really has changed?

The company was moved from the left to the right hand of the government. Perhaps there are more conflicts of interests now, not to mention nepotism rearing its ugly head again. Oh and of course, potentially million dollar salaries for these million dollar talents.

Can someone tell me how are these moves going to improve our status as a leading aviation hub?