Cabinet to discuss bill on formation of new aviation regulator this month

NEW DELHI: The Cabinet will consider later this month a draft legislation to set up a more powerful and passenger-friendly civil aviation regulator.

The proposed Civil Aviation Authority (CAA), which will replace the existing regulator, the Directorate General of Civil Aviation (DGCA), will have financial and administrative autonomy to ensure that airlines adhere to international standards of safety and fares. The process of setting up the CAA was fast-tracked after the 2010 Mangalore plane crash that killed 158 people aboard.

"The CAA note is supposed to go to the Cabinet by the end of the month," a senior civil aviation ministry official said, adding, "The formation of the CAA is a part of the prime minister's thrust area and, hopefully, the Bill will be able to make it to Parliament this year itself."

It has been proposed that the CAA will charge 12 per departing passenger and use 1% of air navigation service charges to meet its funding requirements. The annual budget of the CAA will be twice that of the DGCA at about 160 crore.

The aviation ministry has mooted appointment of regional ombudsman, powers for airfare regulation and appellate authority status for the CAA to give it more teeth than the DGCA.

The CAA will be able to recruit staff directly, unlike the DGCA, which has to go through the department of personnel and training and the Union Public Service Commission. The DGCA currently has 130 employees and needs 500 more. Manpower shortage was cited as one of the reasons for the fake pilots scam unearthed last year.

The CAA will also ensure that airlines adhere to international standards of setting airfares and have a mechanism to prevent cartelisation.

The regional ombudsman will help resolve issues between stakeholders, namely airlines, airport operators, passengers and various government and non-government agencies. Experts say regional ombudsmen will play an important role in an expanding aviation market like India, as they do in other big aviation markets.

"Empowering regional offices is a welcome step, as it would enable speedier action in a country with a fast-growing aviation industry," said Amber Dubey, director (aviation) at consultancy firm KPMG.

"USA's FAA has around nine regional offices providing regulatory oversight for the same reason," he added.

The draft Bill has also recommended setting up of a separate body to look into air crashes so that the investigative and regulatory functions of CAA do not conflict with each other. At present, the DGCA does safety audits, grants licences and also investigates air crashes.

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