CAAP Wants Govt Dividends for Upgrading Equipment

To gather over ₱13 billion to upgrade its facilities, the Civil Aviation Authority of the Philippines (CAAP) is planning to their remittances to the government.

Transportation Undersecretary Roberto Lim mentioned that CAAP plans on requesting dispensation from the Dividends Law or Republic Act 7656. This law mandates that all state-run firms should declare and remit over 50% of their net earnings to the government annually.

The law also states that the remittance percentage can be modified by the President upon recommendation of the Department of Finance.

Lim mentions that the government should provide time for the CAAP to make up for its financial losses since this was affected by the pandemic. By granting exemption to the CAAP from dividends, the agency can allocate funding for the upgrading of the traffic management system.

During the height of the pandemic in 2020, CAAP remitted around ₱6 billion to the government and became the 4th biggest contributor among state-run firms that year. CAAP can generate funds from the certification of airports, airlines, aircraft, and the licensing of aviation officers and personnel.

CAAP Director General Manuel Antonio Tamayo has expressed his hope that the government will be able to provide subsidies to the agency for its modernization fund.

“Our budget at CAAP  is really limited because during the pandemic the bulk of CAAP’s savings was transferred to the national treasury. In the past two years, in 2021 and in 2022, CAAP was getting subsidies from the national government,” mentioned Tamayo.

“This year, we don’t see any budget subsidies for CAAP and that is our main concern right now: to be able to maintain this vital equipment. Safety is paramount. Since safety is paramount, we have to have the tools to perform this,”

Source: Philstar