TRANSPORT CANADA IS to contribute an additional C$75 million ($55.7 million) to the Canadian Automated Air Traffic System (CAATS) under an amended contract with Hughes Aircraft of Canada.
The additional money pushes the project's total budget to C$734 million. An independent report by Intermetrics of McLean, Virginia, suggests, however, that the figure under-states the true cost of the CAATS project, which is now two years behind schedule.
The study, commissioned by Transport Canada, concludes that the project remains "technically sound", but warns that its life-cycle maintenance costs could be much higher than expected.
Transport Canada hopes to sell the entire air-traffic-control (ATC) service, including the CAATS, by April 1996 to Nav Canada, a non-profit-making corporation run by user groups, including airlines and air-traffic controllers.
Nav Canada will earn revenues by billing airlines for the provision of ATC services over Canada. The organisation says that it intends to examine the amended CAATS contract carefully before making any offer which means accepting responsibility for future lease payments, which will easily top C$30 million a year.
Transport Canada has now agreed to lease the computer equipment, rather than buy it, when it starts operations in 1998.
Source: Flight International
