Questions and Answers About the Airline Passengers Organization (APO)

WHAT IS THE AIRLINE PASSENGER ORGANIZATION (APO)?
The Airline Passenger Organization (APO) is a proposed federally-chartered, non-profit organization designed to represent and educate consumers on financial services issues. The APO proposal is based upon Citizen Utility Boards (CUBs) which already exist in four states in the U.S. In these states, utilities have been required to enclose a one-page pamphlet in their billing envelopes inviting people to join the CUB. About four percent of consumers usually join the CUB at a $10-15 annual membership fee. CUBs are independent, broad-based watchdog groups that are run democratically by their members and 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 over $6 billion since 1983 by opposing rate hikes by utilities.

HOW WILL THE APO BE SET UP AND HOW WILL IT WORK?
To set up the APO, the federal government would require Canada's airlines to distribute periodically 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 about $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 at 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 a $16 million annual budget. With these resources and large membership base, the APO will be large and strong enough to help airline passengers and hold airlines accountable to consumer interests.

The APO will be a democratic organization, controlled by its members through the election of regional delegates and the APO's board of directors. The board will hire the APO's professional staff and determine the group's policies.

WHAT WILL THE APO DO?
The APO will hire economists, experts, organizers and attorneys to represent consumers. The APO will also educate consumers through price surveys, public forums, and shopping guides.

WHY IS THE APO NEEDED?
In the past year, Canada's two national airlines have been discussing merging and other major changes to Canada's airline industry. The airlines have received subsidies and privileges from the Canadian government in the past in terms of financing, and more recently in terms of suspension of federal competition law to allow them to discuss merging.

There have been ongoing complaints about health and safety, service quality, pricing, regulation, and public participation in policy-making about the airline industry in Canada.

Consumers are an important part of Canada's air transportation system, but their voice is not being heard in policy-making as the marketplace changes significantly. The APO will give consumers an organized voice for their interests on issues in the marketplace.

With airlines offering an increasingly broad array of inter-airline partnership and frequent-flyer deals, consumers often lack the information needed to take advantage of these deals. The APO will also provide this information, encouraging competition in the marketplace and better service for all airline passengers.