Question

Provide a real world example of a large government agency that has had a major impact on society from a financial perspective (either positive or negative) and why?

350 words answer.

Answer 1

The real world example of the large government agency that had suffer major losses in 2017-18 that also impacted on society in financial terms in negative sense is as follows:

Airport authority of INDIA (AII) were in losses in the last financial year , according to information released by the government Airport Authority of INDIA owns and manages 129 Airports out of which 94 Airports were running in loss in the financial year 2017-18. Out of all the airports managed by AAI, only 13 of them made profits in both 2014-15 & 2015-16. This number increased to 15 in 2016-17 and even in 2017-18, the number of profit making airports remained at 15. On the other hand, the number of loss making airports was 94 in 2014-15 which increased to 96 in 2015-16. This has now decreased to 91 in 2017-18.

Number of Airports (Bifurcation of 125 Airports)

The AAI currently manages 125 airports, which include 18 International Airports, 07 Customs Airports, 78 Domestic Airports and 26 Civil Enclaves at Defense airfields. Some of the bigger Airports like the ones in Delhi, Mumbai & Hyderabad are PPP projects and are not managed by AAI.

Society gets impacted too

Due to this major losses suffered by the Airport authority of the India (AII) the whole society impacted badly and the fares of the aero-plane tickets were increased its rates to the double to the customers and travelers were not able to pay that much amount to travel domestically and internationally so this this shows that how the citizens living India gets impacted financially.

The losses are mainly due to the low revenue generation to meet the total expenditure of 94 airports, the Civil aviation minister said this as reply to the Lok sabha and he also said that the AII has also taken the steps to enhance the revenue.

When asked about the steps being taken to make these airports financial sound, the government says it is trying to develop cargo activities, increase non-aeronautical revenue through revision of rates and award of contracts through master concessions, allowing operation of flying schools at non-operational airports, encouraging Maintenance, Repair & Overhauling activities.