Tuesday, March 15, 2005

OTTAWA - Today, in response to the collapse of Jetsgo airline company, Democracy Watch called for the creation of an Air Passengers Organization (APO) to balance the marketplace by giving airline passengers a strong voice in airline complaint and government policy-making processes.

"The federal government has made many decisions in the past several years about airline issues without any significant input from passengers," said Duff Conacher, Coordinator of Democracy Watch. "The best thing the government can do for passengers is to require airlines to facilitate the creation of an air passengers group that will have the broad base and resources needed to hold the airlines accountable for poor service and to ensure that passengers have a strong voice in future airline policy-making."

Under Democracy Watch's proposal, the APO would be created by the method used in some U.S. states to create utility watchdog groups.  In these states, utilities have been required to enclose a flyer in their billing envelopes inviting people to join what is called a Citizen Utility Board (CUB).  About 4% of consumers usually join the CUB at a $10-15 annual membership fee.  CUBs are independent, democratically structured, broad-based watchdog groups that represent consumers’ interests in the marketplace.  For example, in Illinois the CUB has 150,000 members, a $1.5 million annual budget, and has saved consumers more than $4 billion since 1983 by opposing rate hikes by utilities.

To set up the APO, the federal government would require Canada's airlines to distribute a one-page pamphlet to passengers when they board a plane and also through frequent-flyer mailings.  The pamphlet will describe the APO and invite passengers to join at an annual membership fee of $30-40.  The government can either lend or grant to the APO the funds needed to print and distribute the first pamphlet.  After the first pamphlet, however, the APO will pay all the costs of the pamphlet.  As a result, the APO can be set up little or no cost to government or the airlines.

If only four percent of the estimated 10 million annual airline passengers in Canada join the APO, it will have 400,000 members and an $8-12 million annual budget.  A national survey has shown that a two-thirds majority of Canadians want such industry watchdog groups created using the pamphlet method.

The nation-wide Corporate Responsibility Coalition, made up of 30 citizen groups, has endorsed the creation of watchdog groups using the pamphlet method for all relevant industry sectors.