Proposed airline fee hike still a proposal: DCA

The Department of Civil Aviation's (DCA) proposed review of fees and charges for the aviation industry is still a proposal and further discussions will be held with industry players tomorrow, DCA director-general Datuk Seri Azharuddin Abdul Rahman said.

He said the meeting will enable airline operators to present their case, with some of them having already submitted counter proposals.

"The (DCA's) proposal is not cast in stone," he told a media briefing on the proposed fee hike here today, adding that the DCA and Transport Ministry would definitely listen to what industry players have to say.

He said the reported 10-fold increase in the fees and charges has yet to be approved, with Transport Minister Datuk Seri Liow Tiong Lai expected to announce the final decision on the matter this Friday.

Azharuddin said fees and charges have not been reviewed for the past 40 years, and the proposed hike would include the usage of air space, air traffic facilities as well as the pilot’s flight licence.

Under the proposal, air navigation flight charges (ANFC) will rise from the current five sen per nautical mile to 50 sen for lightweight aircraft not exceeding 2,500 kg.

For larger aircraft such as the Airbus A320/A330 and Boeing B737/B777, the cost will rise to RM1-RM2.50 per nautical mile from the current 10-25 sen, while for planes exceeding 135,000 kg, the rate will increase from 30 sen to RM3 per nautical mile.

Azharuddin said higher fees and charges are necessary to improve the DCA's capability as an aviation authority, noting the government has approved a plan to transform the DCA into an authority, requiring it to be financially self-sustainable.

He said the department is also in the midst of upgrading its systems, including its air traffic control technology and safety inspection control on aircraft and airports.

"We need better equipment and if we don't do this, we will lag behind. At the same time, we will be audited by the ICAO (International Civil Aviation Organisation) in May.

"(With the system upgrade), we will be able to manage our airspace safely, efficiently and seamlessly," he said, adding that the KL International Airport (KLIA) currently records an average of 1,000 flight movements daily, comprising 500 take-offs and 500 landings.

He said the DCA spends around RM250 million annually to regulate Malaysian airspace, but only makes an average of RM50 million in revenue, leaving a deficit of RM200 million, which requires the department to seek additional funding from the government.

Azharuddin said the proposed new rates are still lower than in a few Southeast Asian countries, including Thailand and Vietnam.

Asked whether the increase would affect ticket prices, he said: "It's up to the airline operators on how they want to deal with the increase, whether they want to absorb it or pass it (to customers)."