Passenger Security Charges Reduced Further

A re-forecast of the Aviation Security Service’s costs and higher-than-expected revenue means that passenger security charges can be reduced further over the next two years, says Transport Minister Steven Joyce.

Charges will decrease from $10.22 to $8.00 (GST inclusive) per departing international passenger, and from $4.45 to $3.70 per departing domestic passenger.

These decreases come on top of reductions made last year. Over the two years international charges have dropped by a total of $7.00 and domestic charges by just under $1.00.

The reductions will eliminate a forecast $27 million of accumulated surpluses (GST exclusive), while leaving in place a reserve of $7.5 million to meet any unexpected costs from significant incidents or new overseas requirements.

“This is another example of government moving to contain costs and ensure value for money across a range of services,” says Mr Joyce. “It is important that government agencies run efficiently and minimise the costs they place on business and the public.”

“I expect the changes to help to contain the cost of air travel over time,” says Mr Joyce.

The forecast accumulated surpluses result largely from a reduction in the Aviation Security Service’s budgeted costs and some additional revenue generated by slightly higher-than-expected passenger numbers.

Charges will likely need to be increased again from 2013/14 once the accumulated surpluses have been eliminated.

Mr Joyce says he expects the reductions will also provide an incentive for the Aviation Security Service to keep future costs low so that any future increases can be kept to a minimum

“I would also make it clear that the reduced charges do not reduce the level of security provided at airports. These changes are about ensuring value for money from security services.”

The new charges will take effect from 1 July this year. They will be reviewed again in 2012/3.