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The Jakarta Post
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Airlines to pay compensation for delays

  • The Jakarta Post

Jakarta | Wed, December 28 2011 | 08:08 am

The Transportation Ministry will require airline companies to pay Rp 300,000 (US$33) to each passenger as compensation for a delayed flight starting Jan. 1. The new rule, however, only applies to a delay of more than four hours.

Airlines will also be required to pay passengers Rp 150,000 if they reroute flights to other destinations and make all necessary arrangements to get the passengers to their original destinations.

Any flight cancellations must be made seven days prior to a flight and passengers will receive a full refund, the new regulation says. If a flight is canceled within seven days of departure, the airline must pay compensation equal to the value of the ticket on top of the full refund.

Djoko Murjatmodjo, the ministry’s acting air transportation director, said the compensation could be paid either in the form of cash or vouchers.

“The airlines can give a Rp 300,000 voucher to each passenger and it should be able to be disbursed on that day or on the following day,” Djoko told reporters on Tuesday.

However, airlines will not be required to pay compensation if the delay is due to bad weather or operational and technical problems, such as refueling delays or a damaged runway.

Transportation Minister Lt. Gen. (ret.) E.E. Mangindaan said the regulation was aimed at protecting customers and to make the airlines more disciplined in promoting safety and the smooth running of the airline business.

Mangindaan said such a penalty system was feasible with the involvement of a consortium of insurance companies.

“Each party, airlines and stakeholders, have agreed to this regulation, and currently we are preparing the insurance consortium,” he said.

He added that the new system would make it compulsory for airline companies to register with an insurance facility within the consortium or other insurance companies.

“An airline does not have to participate in the consortium for they already have their own insurance system,” he added.

The ministry regulation, No. 77/2011 on airline responsibility, was previously scheduled to go into effect on Nov. 8, three months after it was first issued on Aug. 8. Many airlines were not ready for implementation and requested that the ministry postpone the bill.

In a separate interview, the deputy chairman of the Indonesian National Air Carriers’ Association (INACA), Toto Nursatyo, endorsed the regulation.

“We support the regulation because the revised version does not force us to participate in the insurance consortium,” Toto said.

He said INACA would monitor the implementation of the new regulation.

Indonesian Consumers’ Protection Agency chairman Sudaryatmo criticized the new penalty system for failing to factor in the duration of flights in valuing the penalty amounts.

“The value should be proportional to the distance and the duration of the flight,” he said.

Even more importantly, he said, the ministry should be aware that improving the on-time performance could not be implemented immediately.

 Passengers’ safety was the most important factor to consider, he said.

National flag carrier Garuda Indonesia’s public relations senior manager, Ikhsan Rosan, said the company had adjusted its insurance budget in order to be in line with the government regulation.

The airline had a set of rules governing passenger compensation, including offering snacks, meals and accommodation.“We will provide [accommodation at] a hotel and a new flight for a longer than six-hour delay.”

Indonesia Air Asia (IAA) spokeswoman Audrey Progastama was in line with Ikhsan on the new regulation. “Air Asia is ready to follow the new regulation and we do not have any problem with that,” Audrey told the Post.

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