PUTRAJAYA, June 23 — The Civil Aviation Authority of Malaysia (CAAM) will become an independent statutory body with separated and exempted remuneration starting August 1, Transport Minister Anthony Loke Siew Fook announced today.

He said the move is expected to save the government between RM1.5 billion and RM2 billion over the next decade.

“The government approved this move on June 11. This means that the statutory body will no longer require financial injections from the government through annual allocations, and at the same time, it will also not be bound by the government's remuneration system.

“It is both exempted and separated from the Government. So, in other words, it will become a body that is financially and administratively independent,” he said at a press conference at his ministry’s headquarters.

Loke also announced that August 1 has been set as the date for CAAM’s merger with the Malaysian Aviation Commission (Mavcom).

Loke said the CAAM collected about RM150 million in revenue during the first five months of this year, surpassing its total earnings for the whole of last year.

He said this strong performance gave the Cabinet confidence that CAAM would be financially sustainable and able to operate independently moving forward

“Previously, revenue for CAAM is only about in the region RM100 million [to] RM210 million,” he said, adding that most of CAAM's revenue came from aviation services charges.

“CAAM cannot survive on this one so that's why they need at least a RM150 million to RM200 million injection from the government.”

Loke that under the rationalisation initiative, CAAM will take over the economic regulatory functions previously handled by Mavcom, becoming the sole regulatory body for the aviation industry covering technical, safety, and economic matters.

He added that the establishes a solid foundation for CAAM to drive the growth of the aviation industry towards a progressive and sustainable future, supporting Malaysia’s goal of becoming a regional aviation hub.

“This government decision will grant CAAM greater autonomy and flexibility in terms of financial governance, human resource management, and the ability to make strategic decisions.

“Additionally, CAAM will be equipped to plan and implement more efficient resource management strategies in line with international best practices,” he said.

Loke added that 57 Mavcom personnel will be offered appropriate placements within CAAM, based on their skills and experience.

He also noted that a townhall session with Mavcom staff will be held in the next two to three days to discuss the transition.