Govt says 'no' to airfare hike

The government on Friday rejected the distance-based fare slabs proposed by domestic airlines even as it warned them of action if the last-minute ticket prices are higher than the average ahead of the Christmas-New Year break.

“There was an extraordinary hike in fares during the Diwali vacation. We do not want that to be repeated during Christmas,”  Union Minister for Civil Aviation Praful Patel told newspersons here after a meeting with airlines’ representatives.

Patel said the ministry received complaints that some of the domestic airlines had exorbitantly hiked the prices taking advantage of the year-end rush.

He said the kilometre-based fare slabs “do not merit any consideration. It must be sector-wise, category-wise and period-wise so that there is transparency and a level-playing field for both passengers and the industry.”

Advisory Council

The government has also decided to set up a Civil Aviation Economic Advisory Council, on the lines of the Safety Advisory Council set up after the Mangalore crash, the minister said.

The council will advise the Directorate-General of Civil Aviation (DGCA) on all economic and financial issues relating to the aviation sector, including safeguarding consumers’ interests.

To be headed by Civil Aviation Secretary Nasim Zaidi, the council will have members from the DGCA and the Ministry, CEOs of airlines, representatives of IATA, consumer bodies and industry organisations like Ficci and the CII. The council will meet on December 10.
As immediate corrective steps, the ministry has called for a meeting for Saturday to seek explanation from airlines about the arbitrary fare hike.

The minister said the DGCA would exercise its powers under Rule 135 of Aircraft Rules 1937 in taking action against airlines if they raised fares substantially without reason.

Unless the airlines ensure transparency in fixing of airfares, the government will involve Competition Commission of India to deal with the errant airlines, if the situation required, he said. As per the proposals submitted by the airlines, the airfares were quoted for four distance slabs of less than 750 km, 750- 1,000 km, 1,000-1,400 km and beyond 1,400 km.

A passenger buying an economy class ticket closer to the travel date may have to shell
out Rs 10,500 for a Delhi-Chandigarh or Chennai-Coimbatore flight and anything up to Rs 40,000 on the Delhi-Bangalore or the Delhi-Kolkata route.

The airlines have “bucket fares” which mean there are certain number of seats reserved in each flight at low fares that can be booked much in advance. As soon as these numbers of seats are filled, the fares grow progressively to a higher bucket closer to the date of travel.