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NAV CANADA to keep rates low for third consecutive year

June 12, 2008, Ottawa - NAV CANADA today announced a proposal to maintain a one per cent reduction in its service charges that was implemented on a temporary basis on August 1, 2007 and was set to expire on August 31, 2008.


June 12, 2008
By Carey Fredericks

June 12, 2008, Ottawa – NAV CANADA today announced a proposal to maintain a one per cent reduction in its service charges that was implemented on a temporary basis on August 1, 2007 and was set to expire on August 31, 2008. The continuation of these lower rates would save customers an estimated $13 million in fiscal 2009.

This would be the third consecutive year that NAV CANADA has offered reduced rates for the air navigation services it provides to customers. 

Charges were reduced by 1.8 per cent on average on September 1, 2006, and by another 3 per cent on August 1, 2007, in addition to the temporary reduction of one per cent for the period August 1, 2007 to August 31, 2008, which would now be made permanent.

“Continued focus on cost control and productivity improvements, coupled with strong growth in traffic, has allowed us to reduce our rates and save our customers money over the last two years,” said John Crichton, President and CEO. “We anticipate extending these rates into the 2009 fiscal year, including making permanent the temporary rate decrease that was set to expire.”

Overall, NAV CANADA charges have grown only five per cent since they were fully implemented in 1999 – an estimated 17 percentage points below the growth in inflation.

The Company is also proposing a revision to its rates related to the implementation of Phase 2 of adjustments to the weight exponent for its Terminal Service Charge and the terminal component of its Daily Charge as originally announced in April 2006. Phase 1 of the adjustment was implemented on May 1, 2006. 

This change will reduce the weight exponent from 0.85 to 0.8. This will reduce the charges for larger aircraft and increase charges for smaller aircraft, including the Daily charge. This change in methodology is revenue-neutral to NAV CANADA.

These proposals are subject to the mandatory notice and consultation period required by legislation. Input received during the consultation period will then be reviewed by the Company’s Board of Directors.

Details of NAV CANADA's proposed revised service charges are available on NAV CANADA’s web site at www.navcanada.ca .

NAV CANADA, the country's civil air navigation services provider, is a private sector, non-share capital corporation financed through publicly-traded debt. With operations coast to coast, NAV CANADA provides air traffic control, flight information, weather briefings, aeronau