Mofaz to ask gov't to fund 80% of local airlines' security expenses

Move would help open Israel's skies to competition, transportation minister says.

By SHELLY PAZ
December 20, 2007 21:56
2 minute read.
mofaz, good 298

mofaz good 224 88 . (photo credit: Defense Ministry )

 
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Transportation Minister Shaul Mofaz said Thursday that within the next month he will seek government approval for the state to finance 80 percent of the security expenses of local airline companies in a further attempt to open Israel's skies and lower ticket prices for consumers. "Due to Israel's unique security constraints, the local airline companies need to carry the burden of unusual expenditure which are not familiar in the International aviation industry," said Mofaz. "These expenses constitute a heavy weight on the Israeli companies and hurt their ability to compete with the foreign aviation companies. Opening the sky for more Israeli and foreign airline companies without implementing equal ground conditions and fair basic rules for the Israeli carriers, would interfere with their chances to compete within the international market." The request will be based on conclusions of the internal public committee Mofaz appointed to implement an "open sky" policy in the Israeli aviation industry, though the committee recommended full governmental funding of the security expenses. Nowadays, the state of Israel finances 50% of the security expenses of the local airline companies. El Al Israel Airlines has dominated the local aviation market and has fought the opening of the country's skies, which would result in increased competition for the carrier. In exchange for financing the vast part of the security outlay under the current proposal many aerial destinations now under El-Al's exclusivity will be shared with other Israeli companies such as Israir and Arkia. "This decision also will increase the variety that is offered to Israeli customers and will strengthen the industry," Mofaz added, urging Arkia and Israir to begin offering regular flights instead of charters to become leading players and take advantage of the new flying destinations that soon will be offered to Israeli travelers. Mofaz met, Thursday, with El Al CEO Haim Romano and Chairman Israel (Izzy) Borovitch to alert them to his decision. "El Al blesses the decision to recommend the financing of most of the security expenditure of the Israeli airline companies. However, this step does not solve the entire problem of the aviation industry," El Al said in a written response to the decision. "The public committee the minister had appointed recommended a gradual 'opening' of the sky along with full financing of the security costs. In addition, the special expenditure and the special flying destinations require the government to take into consideration further assistance that will allow the Israeli players to participate in this highly competitive global market."

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