Four bidders vying for Nunavut’s new air travel contracts
Nunavut hopes to have new medical, duty travel contract signed by mid-2019
The Government of Nunavut is just a few months away from signing new agreements it hopes will change air travel for the better.
The GN recently closed its request for proposals for new medical and duty travel contracts .
Following both a study and public consultations, it opted to combine medical and duty travel for its new round of contracts, while allowing companies to bid on up to seven routes throughout the territory.
This new set of contracts also includes air freight for general cargo and a public travel component, which requires bidders to offer a percentage of seats to be made available to the general public at an economy-class fare.
The final register lists four applicants that have filed a total of 20 proposals: 16 from Calm Air, two from Canadian North, one from First Air and one from North Star Air, owned by the Northwest Company.
Now, Nunavut’s Department of Community and Government Services will go through those proposals, with the goal of signing new agreements by the summer.
The new contracts would come into effect on January 2020.
The request for proposals represents a major shift in how the government approaches its own air travel.
This time around, the GN is looking for airlines to bid on seven different geographical regions or routes, including Nunavut’s three main regions plus major southern connections, like Iqaluit−Ottawa and Rankin Inlet−Winnipeg.
The GN plans to award the majority of the business in each region or route to a single carrier.
That sets the territory up for another potential monopoly, as the North’s two largest airlines—First Air and Canadian North—move themselves into position to merge.
With no Nunavut stake in either of those two Nunavik- and Inuvialuit-owned airlines, the GN is hoping to use its own buying power to influence ticket prices, through the contract’s public travel component.
The new contract does not require airlines to operate as many weekly flights to Nunavut communities as the current contract does; in some cases, dropping that requirement from eight to three per week.
But the Nunavut government has said it cannot say what flight schedule changes will be implemented until contracts are signed with the successful carriers.
Nunavut spent more than $60 million on medical travel and about $15 million on duty travel in 2017-18.
New contracts would be for three-year periods, with the option to renew those contracts twice, first for two years and then for one year.