CEBU Gov. Gwendolyn Garcia has questioned the proposed P50 increase in both the domestic and international passenger service charges (PSCs) during the Mactan-Cebu International Airport Authority (MCIAA) board meeting on Thursday, Aug. 29, 2019.
The MCIAA board, which has Garcia as a member, deferred the approval of the proposal. It asked for enough time before approving the increase based on the shares of the GMR-Megawide Cebu Airport Corp. (GMCAC), a private concessionaire that operates the Mactan-Cebu International Airport (MCIA).
Under the agreement, GMCAC is allowed to increase by 10 percent its PSC shares for every milestone, or for every five contract years (contract year 1, 6, 11, 16 and so on). The next contract year will start on Nov. 1, 2019, and it will end in November 2020.
The same contract also lays down the procedures, including the formula and timelines, and any other factors affecting the adjustments on domestic and international PSCs, parking fees and tracking fees.
In another development, the international PSC, otherwise known as international terminal fee, shall be incorporated into airline tickets at point of sale for all international flights issued or reissued out of the MCIA on Sept. 1.
As to GMCAC’s PSC shares, if its shares increase, the MCIAA’s PSC share would decrease.
Of the current P300 PSC per domestic flight, P222.50 goes to GMCAC; if the 10 percent increase is granted, the company would receive P244.75. The MCIAA’s share would reduce to P12.61.
MCIAA business development specialist Roland Gabby presented the proposal of P50 adjustment in the PSCs; this was questioned by the governor, who said the passengers would carry the burden if it will push through.
Although the MCIAA board would not defer the GMCAC’s 10-percent increase in its PSC shares, Garcia said she still have to review the figures on the percentage increase.
She also asked how the MCIAA board came up with the P50 PSC adjustment.
Based on Gabby’s presentation, increasing both the domestic and international PSCs could bolster the airport’s security through the procurement of security systems, aircraft firefighting equipment, aircraft retrieval systems, and state-of-the art surveillance system.
The increased PSCs could also help the MCIAA prepare funds for burgeoning land claims.
He said there was no increase since the start of the MCIAA-GMCAC partnership in 2014, and it is time to augment the domestic PSCs with the newly renovated domestic terminal. (WBS)