NCAA Denies Increasing Fees To Make Profit

By:Mauricia Koopman
The Namibia Civil Aviation Authority (NCAA) has rejected allegations that it was increasing fees to make a profit.
In compliance with Namibia Civil Aviation Regulations (NAMCARs), the NCAA hosted a stakeholder consultation hybrid meeting in Windhoek on Tuesday, where the Authority’s Finance Manager Maria Haipinge said the increase is not for the organisation to make a profit.
Haipinge pointed out that the NCAA audited annual financial statements since inception indicate a position of no profit and the Namibia Civil Aviation Act of 2016 classifies the NCAA as an entity for no gain.
“Specifically section 24 (1) of the same act requires that NCAA must utilise the funds received to refry expenses of the Authority. The reason for the increase is not for the NCAA to make a profit,”she claimed.
This comes after the Aircraft Owners and Pilots Association (AOPA) stated in a letter dated 23 February 2023 that the NCAA’s proposed new costs and blanket increase to existing rates under the revised part 187 regulations are expensive when compared to the present legally promulgated charges.
The NCAA proposed hikes to all existing fees ranging from 30% to 55%, with Haipinge emphasising that the NCAA’s proposed fees are lower than what other aviation industries charge.
AOPA Namibia and its members, however, rejected the planned fee increase in a letter sent through its interim Chief Executive Officer Matthew Totten.
Haipinge also stated that government assistance varies and that the NCAA’s financial statements reflect a loss.
She went on to say that the reason for the increase is not to eliminate general aviation, but to train inspectors so that they can provide quality services to aviation participants, and that the government will continue to support the NCAA’s operations.
At the meeting on Tuesday, Haipinge indicated that the hike was motivated by curative inflation between 2017 and 2023.
She went on to say that regulatory training is expensive, especially when compared to other types of training.
Haipinge also revealed that the government contribution to overall cost expenses for 2022 amounted to N$109 million, but the government gave N$69 million, which she said is less than half of the total cost.
“We are not close to breaking even, as in 2021, during Covid-19 amounted to N$156 million and the revenue reported amounted to N$45 million,” she said.
She went on to say that by 2022 companies would be recovering, and that when income and expenses were compared, expenses made up 88% of the revenue incurred, with the government contribution falling year by year.
Haipinge stated that the updated document, which was released on 13 February 2023, will be evaluated, and that adjustments have been made in response to public feedback.
She agreed that the hourly rate is a normal practice in the aviation industry since the NCAA put systems in place to ensure that no unnecessary hours are paid within this rate.
The NCAA, she said, has the lowest fees when compared to other civil aviation authorities.
“NCAA has announced an increase of passengers in Namibia international and regional,” she said.
In this regard, AOPA stated that the NCAA must recognise that the general aviation industry, which is still reeling from the economic ramifications of the Covid-19 pandemic, cannot be expected to make up for the NCAA’s fiscal and budgetary shortfalls through a sudden and unsustainable increase in existing user fees.
AOPA interim CEO stated that the majority of the additional fees being suggested had no legal basis for inclusion in civil aviation laws.
The association had also stated that the proposed new fees and existing fee increases do not commensurate with the value of service being delivered by the NCAA.
Furthermore, Totten stated in the letter that the present and planned laws do not include any key performance indicators (KPIs) for the NCAA and its Executive Director to be held accountable for the performance and expansion of the aviation business.