Windfalls for Nav Canada?
NWT air space expected to brings company millions -- Erasmus
NNSL (Sep 11/98) - An anticipated increase in the number of flights over NWT airspace may mean big bucks for Nav Canada.
According to Yellowknife North MLA Roy Erasmus, the opening of Russian polar routes for international flights will see Nav Canada earn an estimated $225 million annually, $140 million from NWT air space collected through en route charges.
"Nobody seems to be aware of this and they're not considering it in the fees that they're charging us," said Erasmus on Tuesday.
This "windfall," he added, should result in a reduction in proposed user fees expected to go into effect early next year.
Nav Canada, a non-profit organization responsible for the country's air navigation systems, intends to increase fees charged to Northern aviation operators by up to 10 per cent because of higher operating costs in the NWT.
"When these routes open up, the links between North America and Asia will be much better so they will probably be well used, increasing the air traffic in Canada's airspace," said Erasmus.
"Much of that increase, approximately 62 per cent, will occur in the airspace over the NWT."
The International Air Transport Association announced that as early as 1999, previously restricted Russian airspace will be opened thereby allowing non-stop flights between any point in North America and Asia.
"Now they're going to be able to fly over the North Pole, right over us. Everyone of those flights will go over our space and Nav Canada will be charging them fees per kilometre," said Erasmus.
The Yellowknife MLA has sent letters to Federal Transportation Minister David Collenette asking him to engage a section of the Civil Air Navigation Services Commercialization Act. The section would reduce user fees in the North to a level comparable to what Northerners paid before the system was operated by Nav Canada.
Nav Canada's director of rates and revenues Arthur Andreassen said an initiative is under way within Nav Canada to look at the viability and development of polar routes.
"I think it's quite premature to talk about when that might come to fruition," said Andreassen yesterday.
"Regardless of that, what would happen is there are no profits generated by Nav Canada from this. Our general fee structure is a national one which benefits the smaller locations. Whatever impacts these things may have on fees, it would be felt nationally."
Preference would not be given to specific regions like the NWT when user fees are calculated, he added.
Test flights have been made over the polar regions in recent months but Andreassen said airlines are far from using the routes regularly even though it would be less expensive for airlines to fly over the North.
"I don't think that there is even a date set for when it maybe be in operation," he said.
Nav Canada's fees are intended to make up for the elimination of the Air Transportation Tax which was charged to passengers when they purchased their tickets.
By Nav Canada calculations, Northerners will pay $7.5 million more a year and above what they used to pay under the air tax.