Australia’s air navigation service provider will reduce charges to airlines for the first time after a major and sometimes controversial cost-cutting campaign shaved $A170m off its bottom line.
Airservices Australia froze aviation charges in 2015 ahead of a major restructuring the following year that saw widespread redundancies among non-operational staff.
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It said aviation charges would be cut by two percent from July 1 as a result of the “headroom” created by the restructuring, which was designed to avoid cuts to frontline air traffic controllers and firefighters.
Airservices manages about 11 percent of the world’s airspace and the ANSP estimates the price cut will “result in multi-million dollar savings for Australia’s airlines and aviation industry”.
“We are passing on these savings to the aviation sector while not compromising operational safety and continuing to improve service delivery and invest in new technology to help the industry grow,” Airservices chief executive Jason Harfield said in a statement.
“Without the prize freeze and changes introduced under our efficiency program, customers were facing price increases of 15 percent from 2016, costing the aviation sector an extra $380 million over the period to 2020.
“I am very proud of the fact that Airservices is in a position to support the aviation sector in Australia, both through operational excellence and now through lower costs.”
Transport Minister Michael McCormack said the price reductions would go some way to keeping down the cost of operating aircraft in Australian airspace.
“Air travel for millions of Australians is not optional and the Liberal and Nationals government is committed to doing its part to keep aviation costs down,” he said.
However, the restructure has not been plain sailing and unions last year threatened industrial action over moves to cut entitlements.
There have also been claims by air traffic controllers that the system is stretched too thinly with high levels of overtime at Sydney threatening safety.
