Civil Aviation Administration: Financial subsidy policy for domestic passenger flights will be flexibly adjusted according to market changes

Source: Visual China

Reporter Xue Bingbing

On May 26 , the Ministry of Finance and the Civil Aviation Administration issued a notice on the phased implementation of financial subsidies for domestic passenger flight operations. Financial subsidies are activated when the number of passenger flights is less than or equal to 4,500 .

According to the announcement, when domestic transport airlines fly domestic passenger flights that meet the following conditions at the same time, they will be included in the scope of financial support:

(1) Domestic passenger flights, excluding Hong Kong, Macao and Taiwan flights, flights that undertake major emergency transportation tasks, transfer flights, business jets, etc.

(2) The average daily domestic passenger flight volume in actual operation does not exceed the minimum number of flights to maintain safe operation. Stopover flights are calculated according to the departure port of each flight segment.

(3) The average passenger load factor of each flight segment per week does not exceed 75% . When multiple transport airlines fly the same flight segment, the calculation is based on the weekly average passenger load factor of the flight segment of each company.

(4) The actual flight revenue cannot cover the variable cost.

The specific subsidy standard is to subsidize the loss after deducting variable costs from the actual revenue of domestic passenger flights. The upper limit of the maximum loss subsidy standard is set at 24,000 yuan per hour. The policy implementation period is from May 21 , 2022 to July 20 , 2022 .

It is reported that the subsidy funds are jointly borne by the central and local finance. Among them, the central finance will subsidize 65% , 70% and 80% of the eastern, central and western regions respectively, and the local finances of the eastern, central and western regions will undertake 35% , 30% and 30% respectively. 20% .

Jiemian News previously learned that on the afternoon of May 16 , the Civil Aviation Administration organized a video conference for domestic airlines to deploy special support policies for domestic passenger flights.

An airline insider told Jiemian News that the general content of the policy has been determined at the meeting that day, but the Civil Aviation Administration did not give details of the subsidy policy. For example, how and when the subsidy funds are distributed.

The subsidy document released today clarifies this issue, and the subsidy funds are allocated by the financial department of the place where the flight takes off. The central financial subsidy funds are included in the transfer payment and allocated to the relevant provincial financial departments, and the method of pre-allocation and then liquidation shall be adopted.

After the implementation of the policy, 70% of the upper limit of the central financial subsidy funds will be allocated in two batches ; the remaining 30% will be liquidated according to the actual situation according to the prescribed standards after the subsidy policy expires.

Within 5 working days after the end of each week , eligible domestic transport airlines may apply to the financial department of the place where the flight departs for the previous week’s flight subsidy, and provide the flight segment, frequency, flight duration, passenger load factor, actual flight income, Variable costs and other data, and related supporting materials.

The financial department at the location of the flight departure port, together with the relevant regional administrations of civil aviation, shall, in accordance with the provisions of this notice, review the airline’s subsidy application based on the civil aviation administration’s weekly domestic passenger flight schedule and other relevant data, and promptly report the subsidy to the central and local finances. The funds are fully disbursed to the airline.

Since the beginning of this year, in response to the impact of the new crown pneumonia epidemic on the civil aviation industry, the Ministry of Finance and the Civil Aviation Administration have issued a number of fiscal and tax policies to support the safety, stability and rescue development of the civil aviation industry.

However, affected by factors such as repeated epidemics and rising oil prices , civil aviation companies are still facing some practical difficulties . In order to consolidate the foundation of civil aviation safety, with the goal of ensuring the minimum number of operating flights and ensuring safe flights, the Ministry of Finance and the Civil Aviation Administration have begun to implement periodic financial subsidies to inject real money to rescue the market.

In the subsidy notice, the Ministry of Finance and the Civil Aviation Administration stated that domestic transport airlines should start from the overall situation of ensuring aviation safety, and truly use the subsidy funds to improve their safety service capabilities and make up for the loss of flight operations.

Resolutely put an end to behaviors such as random adjustment of flights, malicious low-price competition or even fraudulent subsidy in order to obtain subsidy funds, and shall not use subsidy funds for construction projects and other expenditures that are not related to the operation of domestic passenger flights. After receiving the subsidy funds, the airline conducts accounting processing in accordance with the relevant provisions of the national accounting system.