MAVCOM - CAAM merger will benefit tourism – MATTA

KUALA LUMPUR – January 8, 2020: The merger of Malaysian Aviation Commission (MAVCOM) and the Civil Aviation Authority of Malaysia (CAAM) will benefit the tourism industry, says Malaysian Association of Tour and Travel Agents (MATTA).

MATTA president Datuk Tan Kok Liang told The Mole today that such mergers usually will lead to commercial benefits.

“For two government bodies to merge, it should increase efficiency and reduce overlaps and costs,” he said.

The government had on December 11 last year announced that it will dissolve MAVCOM and transfer its functions to CAAM to empower the latter and strengthen its financial position.

The move came after the US Federal Aviation Administration downgraded Malaysia’s air safety rating from Category 1 to Category 2.

Liang said the MAVCOM-CAAM merger is likely lead to a final cost reduction for consumers, which directly benefit the tourism industry.

“One noticeable impact is the Passenger Service Charge (PSC). It was MAVCOM that allowed the PSC of international flights to be increased from RM50 to RM73, the same rate being applied at the full-service KLIA (Kuala Lumpur International Airport) terminal.

“It was a preposterous decision by MAVCOM to equalise Passenger Service Charge (PSC) rates for KLIA and KLIA2 since these two terminals at Sepang play different roles with the latter being a low-cost terminal for budget airlines.

“Passengers are prepared to pay for services that they want but no one will take kindly to unfair charges. It is wise to remove the one-ringgit service charge on passengers departing from Malaysian airports immediately instead of six months down the road after the merger,” said Liang.

The charge that Liang mentioned is the Regulatory Service Charge (RSC) of RM1 for airlines is to allow Mavcom to independently continue with its consumer initiatives.

Transport Minister Anthony Loke yesterday said that the decision on whether to continue with the RM1 RSC will only be made after the MAVCOM-CAAM merger.

The service charge issue has become controversial with several industry players claiming it was an unnecessary burden for passengers despite others considered it to be justified as MAVCOM was no longer funded by the government.

Liang also believes that the merger would make the Malaysian airline industry more efficient, as it should be easier for airlines to engage with a single regulatory entity rather than two.