Tag: nav canada

Privatize the FAA

Bloomberg is reporting more bad news for the nation’s air traffic control system, which is run by the Federal Aviation Administration. The FAA is $500 million overbudget and six years behind schedule on a $2.1 billion technology upgrade project.

The FAA has a long history of mismanaged technology projects, and so the latest screw-ups are nothing new. Yet the nation needs high-tech advances in air traffic control more than ever to ease our increasingly congested airspaces.

There is a better way to run air traffic control—a private sector way, as Canada has been demonstrating. In 1996, Canada converted its government air traffic control system to a private nonprofit corporation. Nav Canada has been a smashing success, providing an excellent model for possible U.S. reforms.

A December 24 story in the Financial Post describes how Nav Canada is a world leader in efficiency, safety, and technology under private management. “A once troubled government asset, the country’s civil air traffic controller was privatized 14 years ago and is now a shining example of how to create a global technology leader out of a hulking government bureaucracy.” It really is an impressive story of pro-market reform.  

Canada’s system recently won an award from the International Air Transport Association. The IATA said that “Nav Canada is a global leader in the efficient implementation and reliable delivery of air traffic control procedures and technologies.”

We should have that type of efficient air traffic control system in this country. Privatizing the FAA should be a high priority for the next Congress.

See here for a discussion on privatizing air traffic control.

Canada’s Private ATC Wins Award

Canada’s private air traffic control system, Nav Canada, recently received its second “Eagle Award” from the International Air Transport Association. The Eagle Awards “honor air navigation service providers and airports for outstanding performance in customer satisfaction, cost efficiency, and continuous improvement.”

In naming Nav Canada “the best” ATC, the IATA said the following in its press release:

Nav Canada is a global leader in the efficient implementation and reliable delivery of air traffic control procedures and technologies. It actively engages its customers at all levels in regular and meaningful consultations. “The performance of Nav Canada has been enhanced by the right technical and operational investments following extensive cost/benefit analyses. Nav Canada’s effective management has allowed the company to reduce its charges in 2006 and 2007, and freeze them at that level ever since,” Bisignani said.

Unlike the government-run ATC system in the U.S., Nav Canada is a privately run, not-for-profit corporation. As a Cato essay on privatization explains, the U.S. system leaves a lot to be desired while the private Canadian system has been a tremendous success:

The Federal Aviation Administration has been mismanaged for decades and provides Americans with second-rate air traffic control. The FAA has struggled to expand capacity and modernize its technology, and its upgrade efforts have often fallen behind schedule and gone over budget…The GAO has had the FAA on its watch list of wasteful “high-risk” agencies for years…Canada privatized its ATC system in 1996. It set up a private, nonprofit ATC corporation, Nav Canada, which is self-supporting from charges on aviation users. The Canadian system has received high marks for sound finances, solid management, and investment in new technologies.

Critics of privatization claim that it’s “too risky” to place such activities in the hands of the private sector. Canada’s success undermines that argument. In fact, air traffic control is far too important for such government mismanagement and should therefore be privatized. In doing so, policymakers should look to our neighbors to the north as a model for how to get the job done right.

See this Cato essay for more on airports and air traffic control.