Saturday, July 13, 2013

Fliers may be charged up to Rs 10 for every ticket purchased to fund new aviation regulator

New Delhi: The government is preparing to charge air passengers up to Rs 10 for every ticket purchased to create a new regulator for civil aviation, including the salary of staff, in an unusual instance of consumers having to directly pay for the running of a government authority.
Civil aviation secretary KN Srivastava said the cost of creating and running the new regulator, Civil Aviation Authority (CAA), is estimated to be around Rs 112 crore a year and one of the sources of its funding will be passengers. "We could charge Rs 5 to Rs 10, which are nominal amounts, but will add up to at least Rs 50 crore a year," he told ET.
The Cabinet cleared the proposal to replace the current regulator, Directorate General of Civil Aviation (DGCA), which has been hobbled by a serious staff shortage, with the CAA on Thursday. The draft legislation will be presented in the monsoon session of Parliament.
Unlike the DGCA, the CAA will have full operational and financial autonomy, according to the draft legislation. In other words, the CAA can recruit and fix remuneration by itself, without turning to the government for money.
Passengers apart, funding for the new authority will be generated from the fees for air navigation services and licence fee charged from airports, pilots and other aviation stakeholders. "One percent of the total collections from air navigation service fees, which will total Rs 18 crore a year, and Rs 50 crore a year from licence fees will be collected for the CAA," said Srivastava.
12/07/13 Binoy Prabhakar/Economic Times