Conflict of Interest Threatens Bahamian Aviation Industry

Conflict of Interest Threatens Bahamian Aviation Industry
By Neil Hartnell

The Bahamian aviation industry's "healthy development might be compromised" by its current regulatory structure, a confidential government paper has warned, undermining the sector's competitiveness due to "a serious conflict of interest" between the Civil Aviation Department's (CAD) various functions.

A draft copy of the proposed 'White Paper' National Aviation Policy, which is understood to have been discussed at a recent meeting involving government and Inter-American Development Bank (IDB) representatives, said CAD's current structure effectively left one arm regulating the activities of another.

The report, which has been obtained by Tribune Business, said a review of the aviation industry's institutional framework noted the "high degree of concentration of functions" within CAD, which had responsibility for policy making, technical regulation, operation of the Bahamas' air traffic control infrastructure and accident investigation.

The draft National Aviation Policy recommends that the CAD's responsibilities be split up, with a separate Civil Aviation Agency - also separate from government - taking over technical regulation of the industry. It was also suggested that infrastructure, airport and air traffic control services be placed under a "reformed Airport Authority". Accident investigations were proposed to go to another independent body.

Indicating that the economic competitiveness of the Bahamian aviation industry, a critical component of this nation's tourism industry, and the airlines and other players in it could be undermined by an inadequate regulatory regime, the draft White Paper said policy should be at "arm's length" from operations.

That is likely to be an oblique reference to government-owned Bahamasair, but the draft National Aviation Policy said market data indicated "the absence of protectionist policies that could restrict capacity or entry points".

Nassau was said to be connected to 22 non-stop markets in the US, Canada, Caribbean and the UK, with the US accounting for 54 per cent of markets out of Nassau and 81 per cent of international seat capacity.

Still, the draft National Aviation Policy warned that the CAD's current structure created "a serious conflict of interest on different levels", and argued that it was "essential to redesign the current framework to ensure the development of the aviation sector in a safe, transparent and efficient manner".