Canada’s civil air navigation service provider (ANSP) NAV CANADA is to revise the charges for its services by temporarily reducing its rate for one year, as well as revising its base rates.
The charges for all services will be reduced during NAV CANADA’s next fiscal year, from 1 September 2016 to 31 August 2017.
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NAV CANADA president and CEO Neil Wilson said: "The purpose of the one-year temporary rate reduction is to return this additional $50m to customers.
"Under the ANS Act, NAV CANADA is obligated to ensure that our service charges are set at the levels necessary to meet the financial requirements of providing civil air navigation services.
"Strong cost controls coupled with a growth in air traffic have resulted in a forecast surplus for 2017, putting us in a position to make this proposal consistent with our cost recovery mandate."
On average, the adjustment will reduce the ANSP’s current base rates by 3.7%.
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By GlobalDataFor general aviation charges, the rate reduction will be applied from 1 March 2017 to 28 February 2018.
For the present fiscal year, ending 31 August 2016, the company expects the balance in its rate stabilisation account to be $150m, surpassing the target balance of $100m.
NAV CANADA also intends to revise its base rates to ensure they are in line with company costs.
On an ongoing basis, the base rate revision will enable an average reduction of 3.9% from existing rates.
The rate adjustments are to address an imbalance that occurred due to a significant growth in overflight traffic.
During fiscal year 2017, NAV CANADA’s service charges will be reduced compared to the current charges by an average of 7.6%.
Wilson said: "Customers expect and deserve safe and efficient air navigation services at a reasonable cost.
"We are pleased to be able to deliver on these expectations through this rate proposal, while continuing to ensure appropriate compensation and a professional and fulfilling workplace for employees."
Customer savings for the next fiscal year are estimated at nearly $100m, and about $50m for fiscal 2018.
