PIA incurs Rs9bn losses from free, discounted tickets, says audit

ISLAMABAD: The Pakistan International Airlines Corporation Limited (PIACL) suffered revenue losses of more than Rs9 billion between 2008 and 2017 due to the unchecked distribution of free and heavily discounted tickets during the tenures of the Pakistan People’s Party (PPP) and Pakistan Muslim League-Nawaz (PML-N) governments.

According to a report by the Auditor General of Pakistan (AGP), 258,990 passengers travelled on “zero fare” tickets between 2011 and 2016, resulting in losses of Rs5.55 billion to the national flag carrier.

The majority of these beneficiaries were non-employees, who violated internal policies at a time when the airline was already under severe financial strain.

In addition, 190,724 passengers were allowed to travel on tickets issued with unauthorised discounts.

“Of these, 116,273 passengers received as much as a 95 per cent discount leading to additional losses of Rs2.91 billion. Overall, discounted ticketing caused losses of Rs3.49 billion,” the audit report said

The report highlighted a breakdown of internal controls and oversight mechanisms within PIA during this period.

It noted that any ticket concession worth more than Rs100,000 was supposed to be approved by the PIACL chairman. However, the audit team found no documentation of such approvals, raising serious questions about compliance with the airline’s own “Schedule of Powers.” Instead, massive discounts were issued without following procedures.

Despite the scale of losses, the audit report said, the PIA management repeatedly avoided cooperating with the audit team. The issue was first raised in 2018, but DAC meetings were delayed for years and nine formal reminders from the audit team were ignored.

When a DAC meeting was finally held in 2021, the matter was reportedly downplayed, and the official minutes were not shared with auditors.

The audit recommended the complete withdrawal of the free-ticket policy, strict enforcement of approval rules, and the establishment of a transparent, Board-approved concession framework.

With the national flag carrier now facing privatisation and burdened by heavy liabilities, the free and discounted tickets scandal has reignited calls for accountability and reforms.

The audit observed that unless those responsible are identified and held to account, such financial mismanagement is likely to persist.

HUM News English approached the PIA spokesperson for comment, but no reply was received till the filing of this report.

The PIA operated 1,118 domestic and international flights from Islamabad between 2021 and 2023 with only one or two passengers on board, according to a report by the AGP.