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THE MINISTRY of Transportation said it had no plans to revise Law no. 1/2009 concerning Aviation relating to the airline association’s proposal to eliminate upper limit rates for airplane tickets.
According to spokesperson for the Ministry of Transportation, Adita Irawati, explained that the provisions regarding upper limit and lower limit rates for airplane tickets had been mandated in Law no. 1/2009 concerning Aviation. The Ministry of Transportation had no plans to propose revisions to the statutory regulations.
“Currently there are no plans [to revise Law no. 1/2009. As for the abolition of upper limit tariff, that is a statutory regulation so it cannot be decided only through the executive, it must also go through the legislature,” said Adita at the Ministry of Transportation Office, Jakarta on Monday (11/13), 2023.
Adita explained that the regulations regarding upper limit rates and lower limit rates for airline tickets are stated in the law to protect two parties, namely the airline and the public. This is in line with the Ministry of Transportation’s duties as a regulator to safeguard the interests of all stakeholders in the aviation sector.
He explained that plane ticket rates that are too low will be detrimental to airlines. On the other hand, plane ticket rates that are too high will burden the costs incurred by the public as consumers.
“Our job is to maintain industrial balance, affordability for the public and how airlines can continue to serve and meet safety standards. Well, if it really wants to be removed Upper Limit Rates and Lower Limit Rates, we must first discuss how to protect both parties in the future,” continued Adita.
Previously, the Indonesian National Air Carrier Association (INACA) recommended the government to eliminate the upper limit tariff provisions for airline tickets in line with increasing operational costs triggered by movements in aviation fuel prices and weakening currency exchange rates.
Meanwhile, INACA General Chair Denon Prawiraatmadja said that the recommendation to eliminate the upper limit rate for airline tickets was taken considering the trend of increasing airline operational costs after the COVID-19 pandemic.
One of the reasons for the increase in operational costs was the increase in the price of aircraft fuel or aviation fuel. This is also coupled with the trend of weakening of the rupiah exchange rate against the US dollar which has approached around IDR16,000 per US$.
“One of our (INACA) proposals is to eliminate the upper limit tariff, so that the ticket price will be handed over to market mechanisms,” explained Denon. [sources/photo special]
