AERA hikes user fee for passengers at KIA

AERA hikes user fee for passengers at KIA

7.7 pc rise for domestic, 29 pc for international travellers

AERA hikes user fee for passengers at KIA

The User Development Fee (UDF) for domestic and international passengers departing from the Kempegowda International Airport (KIA) here has been hiked from July 1, 2014.


However, since a component of the Passenger Service Fee (PSF) has been merged with the new UDF, the effective burden (UDF + PSF) on air travellers will increase only by 7.7 per cent for domestic and 29 per cent for international passengers.   

The revision is the first since the airport opened in May 2008. The new UDF would have been much higher had the Airports Economic Regulatory Authority (AERA) agreed to the fee hike sought by the Kempegowda International Airport Limited (KIAL). 

AERA has revised the fees after months of consultation with various stake-holders including KIAL, the airlines and the State Government. 

Departing domestic passengers will now have to shell out Rs. 342 plus taxes as UDF (inclusive of Rs 77, the facilitation component of PSF) and Rs 130 as PSF. 

The existing UDF is Rs  231.40 plus taxes and PSF of Rs 207. Airlines collect the PSF from passengers and pay to KIAL for use of terminal, runway, emergency services and security facilities.  

For international passengers, the new UDF is Rs 1,368 plus taxes and PSF of Rs 130. This amounts to a 29 per cent increase over the current burden for the passengers (UDF of Rs 952.30 before taxes and PSF of Rs 207). 

These fares are effective only till March 31, 2015. New UDF rates will come into force from April 1, 2015 till March 31, 2016. 

AERA has exempted crew on duty and infants less than two years of age from paying UDF applicable to both domestic and international sectors. 

In its final order on the new UDF and other charges, AERA ruled that the airport operator cannot recover its charges incurred in the last 30 months from future passengers and airlines. 

“This approach is unacceptable as it would increase the operational expenditure of the airlines and rendering its operations economically unviable. ... Future consumers cannot be burdened with additional costs...,” the Authority observed. 

No losses since Sept 2009

AERA also noted that the airport operators had not posted any losses in its profit since September 1, 2009, when the Authority was notified. 

Hence, there was no question of considering any pre-control period shortfall in revenue generation, to determine the new tariff, it said. 

The new UDF and other charges have been calculated based on ARA’s control period of the airport from April 1, 2011 to March 31, 2016. 

No respite from UDF

Bangaloreans heading out of the country will have no such respite from UDF as those flying out from Hyderabad’s Rajiv Gandhi International Airport (RGIA). AERA had completely scrapped UDF at RGIA from April 1, 2014 till March 31, 2016. 

The 29 per cent combined hike in UDF and PSF will add to the burden of international passengers. Domestic passengers too are denied the UDF waiver, although they have been spared a hefty hike. On its part, the state government, with a 13 per cent stake in KIA, had given its nod last month for the UDF hike.