The Ministry of Transport (MOT) and the Civil Aviation Authority of Singapore (CAAS) announced on 28 February 2018 a new Airport Development Levy to fund the Changi Airport expansion project, or Changi East.

Factually explains why travellers have to pay the new Airport Development Levy, which goes towards funding the Changi East developments.

1.     Why must I pay for something that I am not using at the moment?

Infrastructure investments can be very lumpy, with hefty investments required upfront. The joint contribution model – by the Government, Changi Airport Group (CAG) and airport users – for the Changi East development prevents large spikes in charges that may be passed down to airport users in the future. This is not a new concept for airport infrastructure; airports in Hong Kong, Dubai and Qatar have similar models.

2.     Why can’t the Government pay for everything?

In general, airport users should bear their share for the use of airport facilities. Airport users have conventionally paid for the expansion or upgrading of airport facilities at Changi. The expansion of Terminal 1 and the construction of Terminal 4 were fully funded by aeronautical charges, such as the Passenger Service and Security Fee paid by airport users.

Due to the strategic value of Changi East, the Government will pay the majority of the costs, while CAG will contribute the next largest share. Airport users’ contributions is the smallest share of a joint contribution model. If airport users are not to be charged, then the Government - meaning taxpayers - would have to pay more.

Sources:

Joint MOT-CAAS News Release (28 February 2018)

The Straits Times - Travellers using Changi Airport to pay higher fees and charges from July 1 (28 February 2018)

This article is accurate as of March 2018. For latest updates, head over to: www.caas.gov.sg.