Finance minister Clyde Caruana on Tuesday refused to rule out the possibility that Air Malta could be replaced by another flag carrier, but he insisted that the airline's restructuring programme is on track.

Speaking at a press conference, he repeatedly told reporters that plans announced in January are being followed and nothing out of the ordinary was impeding the process to restructure the loss-making airline.

But when specifically asked whether he was considering dismantling the airline, Caruana said he would not comment until talks with the European Commission are over.

The government is asking the commission to authorise state aid for the airline. The talks have been ongoing for months. 

Caruana dismissed rumours that he had ignored calls to meet with trade unions, saying that he would be meeting the unions of pilots and cabin crew later this week.

"The meetings are not about whether the airline will close but about reforms of work practices, among other things," he said.

He also explained the airline had to recruit some 50 new workers after more than the required number of workers decided to leave.

He said recruits started at lower wages, and not on equal and higher wages than those who were already employed, as reported by certain quarters.

Air Malta is currently shedding workers in a last-ditch attempt to cut costs and remain solvent. It has been transferring workers to the public service and is also offering generous early retirement schemes. The aim is to cut the airline’s workforce by half, in a bid to save around €15 million annually.

The airline is also hiving off baggage and ground handling services and dropping unprofitable routes.

574 Air Malta employees will be transferred in the 'coming weeks and months' Caruana said.  

Last week, Prime Minister Robert Abela said Malta will continue to have a national airline, but kept his choice of words vague, and stopped short of saying Air Malta itself would survive its restructuring plans.

He said the government would look after the livelihood of Air Malta workers, who would not be the ones to pay the price of reforming the struggling carrier.

Malta would also continue to have a national carrier, he said, noting that the Labour Party’s electoral manifesto had explicitly promised that.