The Tribune

By NATARIO MCKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

A well-known Bahamian airline executive has questioned whether the government was effectively trying to put domestic carriers out of business by allowing what he labelled as an “underground aviation sector” to exist.

Sky Bahamas CEO Randy Butler said in an interview with Tribune Business: “You have the legitimate operators now who have gotten kicked out or have gone out of business. The government is now creating an underground aviation sector where if you go to general aviation you have people with their planes taking people off, asking them if they are going to this and that place. They don’t have to pay all of the fees, do all of the training or be as qualified. You go out there right now, you could jump on a plane and pay by the seat. They are charging the same money or more than any legitimate commercial airline who has to cover insurance, maintenance, NIB and nothing is being done.”

Mr Butler added: “The fact that the government knows that it exists and allows it says that they are encouraging it. I don’t know if that is the expectation to put legitimate carriers out of business. You just have to look at the amount of fees and taxes the government is levying either directly or indirectly. You have had business licenses go up, Customs fees go up, overtime go up and now we are now paying and environmental levy on tires.”

Mr Butler also recently warned that fee increases being proposed by the Nassau Airport Development Company (NAD) NAD is proposing that the landing fees, terminal fees, aircraft loading bridge fees and aircraft parking fees increase three per cent - or $0.13 cents - per passenger from February 15, 2015. NAD noted that other airports in the Caribbean may be increasing their fees in 2015 and 2016 as well, stating that the costs “are based on a Boeing 737-700 with a 75 per cent load factor (passenger count of 102) with a 90-minute turnaround time, including usage of a jet aircraft loading bridge”.

“Excluding government taxes LPIA’s costs are presently $51.21 per passenger, and with the recommended February 2015 a 3 per cent Aeronautical Fees increase of $0.13 per passenger, becomes $51.34 per passenger and is competitive. NAD rates are exactly where predicted when the project began and this is consistent with the projected government Project Definition Report approval. LPIA is brand new and has three sectors of service. These are dimensions that do not exist at peer comparison airports, but do exist at Miami, Orlando and Fort Lauderdale.

LPIA plans only nominal Airport Fees increases (CPI type) on Aeronautical Rates going forward,” said NAD.