The Cost Of Privatization


NAV CANADA Hikes Service Charges…FONT>

Canadian pilots will find themselves shelling out a few more bucks every time they fly, thanks to a hike in air-navigation service charges. On Monday, NAV CANADA announced the decision to proceed with a planned 6.9-percent increase following a mandatory 60-day consultation period. The company says the charges will be on average only 4 percent higher than when they were first introduced in March 1999. Furthermore, NAV CANADA claims this increase was required to “deal with a revenue shortfall due to the continuing downturn in air traffic.” The new charges will come into effect August 1, 2003, with annual and quarterly charges to be implemented on March 1, 2004. So, how much can flyers expect to cough up? On a per-passenger basis, the increase amounts to 65 cents more per one-way ticket for a flight from Toronto to Ottawa. GA operators should visit NAV CANADA’s homepage for specific information on the increases. NAV CANADA officials claim the company has undertaken an aggressive cost-cutting plan over the last two years, saving about $75 million. This amount is in addition to the $100 million in annual cost savings and staff reductions already achieved through previous restructuring.

…While U.S. ATC Privatization Battles Looms

While Canadians prepare to dish out extra money for their airborne needs, those living in the U.S. continue to fight against the proposition of privatizing ATC. As AVweb reported last month, the White House and Congress are at odds over the upcoming FAA Reauthorization Bill. The administration has threatened to veto the bill if the final version contains language that would outlaw the privatization of air traffic controllers and possibly flight services and technical personnel in the system. In addition, the legislative process itself is stirring controversy and heating up the debate. Stan Soloway, president of the Professional Services Council, a trade group in Arlington, Va., told Washington Technology, “most senators voting for the FAA authorization amendment thought they were voting to restrict privatization of air-traffic control, when they were actually voting to restrict competition for the infrastructure that supports air-traffic control.” “It was never debated in committee, there was a brief discussion, and boom — it passes. That’s not a good way to make public policy,” he told the paper. Legislators’ efforts through A-76 — the revised U.S. Office of Management and Budget circular on public-private competition of government jobs, federal unions and lawmakers — to halt job competitions are “devastating to the agencies,” said Soloway, whose group is working to educate members of Congress about the revised A-76 process.