Finance Minister unveils charter flight assessment process

April 18, 2024 6:56 am

The Deputy Prime Minister and Minister for Finance says charter requests for Fiji Airways are assessed on a case-by-case basis, and in some cases, they are willing to accept payment after the charter has occurred.

Professor Biman Prasad highlighted this in parliament when questioned about Fiji Airway’s charter policies and procedures, which are followed when processing charter requests.

Prasad says a comprehensive analysis is also carried out to determine the cost of operating the charter with Fiji Airways.

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“Upon receipt of the request, the Fiji Airways charter team gathers all relevant information from the customer, including flight dates, number of passengers, special needs, items, and potential flexibility on dates and times. In the event aircraft are not available on preferred dates, an assessment is conducted to determine available resources to support the requested charter aircraft, crew, etc.”

Prasad says an assessment is carried out on the airline’s related costs for the proposed routes, such as fuel, crew costs, accommodation, catering, insurance, engineering, and the expenses that are associated with any flight.

Minister for Finance Professor Biman Prasad

He says this may also include the cost of flight consolidation, opportunity cost, or cost to cover additional risk, particularly when operating a charter to destinations Fiji Airways doesn’t normally operate.

He says when the operational cost forecast has been assessed, a profit margin is added to the cost to finalize the quote.

Prasad adds that if the customer fails to meet the payment milestones, the standard charter contract gives Fiji Airways the right in its direction to cancel the charter and retain a pre-agreed cancellation fee.

He says alternatively, it would be open to the company to accept the revised payment terms.

He adds Fiji Airways standard charter contract requires full payments to be made no later than 38 days prior to the first charter flight.

He adds that more complex charters may also require initial deposits to be made before the 30-day deadline to fund costs associated with obtaining approvals and otherwise preparing to operate a charter flight.