THE CANADIAN Government is to introduce overflight charges to airlines using its airspace, as part of a restructuring in advance of the privatisation of its Air Navigation System (ANS).
The Government confirms that it will privatise its C$800 million ($575 million)-a-year ANS when it releases its plans for the 1996 budget on 27 February.
The Government says that it will introduce legislation late this year to convert the ANS to a non-profit making corporation. The new unit will employ more than 6,000 people now employed by the Department of Transport and will be run by a board of directors with representatives from unions, Government and airlines.
The Government expects to receive about C$1.3 billion when it sells ANS assets to the new corporation. The latter will raise funds by levying fees on airlines and other users.
The first effect of the move will see the transport department start charging airlines a fee during fiscal year 1996, which begins on 1 April, for overflying Canadian territory - something the Government has not previously done.
This will help to close the C$200 million gap between the cost of running the ANS and the revenues it earns from Canada's air-transportation tax, which is levied on air travellers. As the new corporation begins charging airlines for its services, the tax will be phased out.
Source: Flight International
