Sunday, 4 May 2014

Flying into Aerial Curbs

Chinese officials will have to fly domestic airlines as much as possible now
Chinese President Xi Jinping's crackdown on corruption and excessive government spending has now moved to the airline industry.

The government has now ordered officials to buy discount tickets for business trips, with a minimum of 12 percent off the regular price.

In addition, the new rules issued by the Ministry of Finance and the Civil Administration of China says government employees must take domestic carriers wherever possible. One would have thought this would be a given!

If a domestic carrier does not have a direct flight to the overseas destination, then they should fly the domestic carrier to a nearby country and the change flights to get to the destination.

The new rules take effect on June 1 and industry experts say it's hard to tell what the immediate impact will be. It may be difficult to fully enforce due to travelling needs and availability of flights.

Or we could see some creative creative accounting where a ticket might be heavily discounted but an official only claims the minimum 12 percent discount....

It will be interesting to see if these latest rules make any if much of a dent in the airline sector. Last year the spending for official banquets, overseas trips and vehicle purchases plunged compared to 2012.

While the crackdown in lavish spending is good optics for the Chinese government, has it really resulted in more effective and efficient governing?

That's what we really want to know...

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