MORE than 20 million travellers stand to benefit from the lower passenger service charge (PSC) expected to take effect on January 1 next year, said the Malaysian Aviation Commission (Mavcom) today.

The lower rates are expected to come into force following the introduction of the regulatory asset base (RAB) framework.

Among the airports expected to charge the lower rates are Langkawi, Penang, Kota Kinabalu, Kuching, Miri, Sibu, Tawau, Lahad Datu, Kota Baru and Alor Star.

In a statement yesterday, Mavcom said it is in the final stages of completing the RAB framework, which forms the basis for funding and developing the country’s airport network.

The commission expects the finalised framework to reduce PSC at almost all commercial airports in Malaysia, and ensure the country’s airport charges are among the lowest in the region.

The RAB framework will also allow for different PSC rates at airports, depending on their services and infrastructure.

Additionally, Mavcom is due to announce new aircraft landing and parking fees, and the total planned development spending for the next regulatory period, from 2020 to 2022.

Executive chairman Dr Nungsari Radhi said the commission estimates that the government would incur RM300 million in subsidies per annum if PSC is not properly set and under-investment in airports continues.

“With the RAB framework, the government will be able to allocate its resources for the country’s other pressing needs.”

Mavcom has been conducting a comprehensive study on the framework since 2017, engaging more than 80 stakeholder groups, including the Transport, Finance and Economic Affairs Ministries, airlines, airport operators, international aviation bodies and investors.

It has presented the framework with four airport tiers for PSC to policymakers, including Prime Minister Dr Mahathir Mohamad.

“Mavcom is deeply appreciative of the prime minister’s feedback on the RAB framework,” said Nungsari.

“The commission has briefed the prime minister on the work it has undertaken for the benefit of travellers, and how a clear, transparent funding mechanism is required to ensure enough investments in Malaysia’s airports, especially the major ones that require major upgrades.

“The RAB framework can achieve this without imposing a fiscal burden on the government. In fact, the government will get to enjoy returns in the form of user fees paid by airport operators.” – October 24, 2019.