Tugade prefers fuel subsidy for aviation sector over higher surcharge

CEBU —Transportation Secretary Arthur Tugade prefers to subsidize portions of airlines’ fuel costs than to approve a higher fuel surcharge, which would be passed on to the air traveling public, amid the skyrocketing petroleum prices.

“Kung maari lumihis tayo diyan kasi ‘pag mag-fuel surcharge ipapasa sa pasahero ‘yan, mapapataas na naman ang cost of travel,” Tugade told reporters on the sidelines of Cebu Pacific’s 26th anniversary celebration at Mactan Cebu International Airport.

(As much as possible let us avoid increasing the fuel surcharge because it will be passed on to passengers, which then will increase cost of travel.)

Even before Russia's invasion of Ukraine, the Civil Aeronautics Board (CAB) had upgraded the fuel surcharge rate for March 1 to April 30, 2022 period to Level 4, after it considered that the price of jet fuel averaged $95.35 per barrel for December 2021 to January 2022.

Under Level 4 of the Fuel Surcharge Matrix, airlines may collect a fuel surcharge of P108 to P411 for domestic flights and P543 to P5,026 for international flights.

However, another upgrade of the fuel surcharge can be triggered as jet fuel price already reached $161 per barrel as of March 25, 2022, up 141.5% year-on-year, based on the data from the International Air Transport Association.

Tugade, however, said that “sa akin, ang posisyon ko, maintain mo ‘yung cost of travel at a minimum, wala munang fuel surcharge [my position is to maintain the cost of travel at a minimum, no fuel surcharge].”

The Transportation chief said that the government will look into the possibility of providing subsidies for the aviation sector.

“Titingnan rin kung baka pwede magbigay ng subsidiya kagaya ng subsidiya pinaabot sa road sector,” Tugade said.

(We will look into the possibility of providing fuel subsidy similar to what has been given to the road sector.)

The Department of Transportation, through the Land Transportation Franchising and Regulatory Board, is giving out fuel cash cards to public utility vehicle drivers and operators amounting to P6,500 for March and another P6,500 for April.

“Anything that will help in addressing the [rising] fuel cost without necessarily passing the cost to the riding public or to the passenger, I look at it with favor,” he said.

Tugade said the DOTr will request the Congress to approve a budget for fuel subsidy for the aviation sector.

“Kagaya ng siste at proseso ng fuel subsidy at service contracting susundin namin sa ibang sector ng transportasyon,” he said.

(Similar to the system and process that the fuel subsidy and service contracting for the road sector have undergone, we will follow a similar track for fuel subsidy in other sectors of transportation.)

In the meantime, the Transportation chief said that the government will continue to waive aviation fees such as landing and take off as well as concession fees to help in minimizing the cost of air travel. — BM, GMA News