Govt aims to empower CAAM financially through merger with Mavcom

In the long run, the aviation authority can hire and pay at a better rate, says Loke

by DASHVEENJIT KAUR/ pic by MUHD AMIN NAHARUL

THE US Federal Aviation Administration’s (FAA) decision to downgrade Malaysia’s air safety rating from Category 1 to Category 2 were among the reasons for the move to disband the Malaysian Aviation Commission (Mavcom) and have its key roles absorbed by the Civil Aviation Authority of Malaysia (CAAM).

Transport Minister Anthony Loke (picture) said the merger would empower CAAM, as well as to strengthen its financial position.

“One of the issues which led to the downgrade by the FAA was that CAAM does not have the financial capability to hire the best qualified technical personnel.

“This move will then empower CAAM financially and get it back to Category 1 from the previous downgrade,” he said after the launch of #JOMTEKSI last Friday.

Through the merger, Loke said CAAM would be empowered financially, granting them more power in terms of setting the fees. “In the long run, they can hire and pay at a better rate,” he said.

The government’s decision also sparked a debate over the necessity of having an independent economic regulatory body to avoid a reversion back to the service quality of when the industry was served by the Department of Civil Aviation, the predecessor of CAAM.

Loke, however, reiterated that the decision came after studying civil aviation authority regulatory models in various different countries.

“In any country, aviation authority lies in the civil aviation authority of that particular country, because you need a technical regulator for the aviation industry.

“We look at various models. The technical regulator also regulates economic activities, so they are the sole authority in terms of providing the licences. In other countries, there is no separate authority,” he explained.

The decision to merge both entities was a mandate from the Cabinet, Loke said, and his ministry would be working on the formalities in the next few months including bringing the amendment to the Parliament.

“The regulatory body of the Malaysian aviation industry will be rationalised and placed under one entity. We will then have a number of legislative amendments — including the repeal of the Malaysian Aviation Commission Act 2015 (Act 771) and amendments to the CAAM Act 2017 (Act 788).

“The repeal of Act 771 will allow Mavcom’s functions to be transferred to CAAM and most positions at Mavcom involving expertise in certain area will be transferred to CAAM,” he said.

Currently, Mavcom regulates commercial and economic matters in the Malaysian aviation sector and CAAM oversees technical issues in the sector.

Last week, the Transport Ministry announced that Mavcom is to be disbanded, to optimise resources and increase management efficiency, as well as paving the way for increased competitiveness.

“The rationalisation initiative of a civil aviation regulatory body to be placed under one entity would not only optimise existing human and financial resources, but will enhance the efficiency of governance and the quality of service delivery,” according to a statement by the ministry.