Parliamentary Committee wants fixing of upper cap on airfares

The Standing Committee on Transport, Tourism and Culture rejected as a "faulty premise" the Ministry's stand that tariffs are fixed as per the global practices and asked it to regulate ticket and baggage charges in a way that benefits the travellers.

"The Committee notes that around festivals and for bookings made closer to the date of travel, some airlines are charging more than 10 times of the advance booking fare. The Committee observes that this is arbitrary," said a report tabled in the Rajya Sabha.

It underlined that a deregulatory environment does not mean unlimited freedom of exploitation and that windfall profits cannot be taken from the hapless passengers, especially from those working class passengers who are travelling in the Gulf sector, the report said.

"The Committee strongly feels that an upper cap of airfare in each sector is the need of the hour to discourage the airlines from predatory pricing of air tickets," the report said.

The Committee said the Civil Aviation Ministry has a social responsibility towards its citizens and economic viability cannot be the only criteria for decision-making.

"The Ministry of Civil Aviation, though aware of the rampant exploitation, is not showing any proactive role in regulating the airfares. The Committee, therefore, recommends the Ministry of Civil Aviation to consider fixing an upper limit of the air tickets for every sector," said the report tabled recently.

The Ministry, while responding to the Committee's concerns, told it that with the repeal of Air Corporations Act in March 1994, the airfare approval was dispensed with by the government.

"At present, airfares are neither controlled nor approved by the government," the ministry said, adding the airlines are free to fix the "responsible" tariff under the Aircraft Rules 1937, "having regard to all relevant factors, including the cost of operation, characteristics of service, reasonable profit and the generally prevailing tariff."

The ministry told the committee that "the airline pricing system runs in multiple levels (buckets or RBDs) which are in line with practice being followed globally."

Unhappy with the government's response, the Committee said, "the reply does not reflect the seriousness of the efforts made by the Ministry in containing the surge in airfares and the resultant profiteering by different airlines."

The report added, "the Committee desires that concerted efforts shall be consistently made by the Ministry to prevail upon different airlines not only to make available more and more low-fare bucket seats, but also to keep the airfares at minimum affordable level for the benefit of common man."

The Committee said the Ministry has taken "refuge in global practices in fixing the luggage charges and uncontrolled airfares" and that it is a "faulty premise".

It said the Indian conditions and needs of the people should be given due consideration while regulating the airfares and luggage charges.

"The Committee recommends that the Ministry of Civil Aviation and DGCA (Directorate General of Civil Aviation) should come forward to regulate baggage charges and airfares in such a way to facilitate and benefit the air passengers," the report said.