Belfast Telegraph

Wednesday 20 August 2014

CAA unveils new airport charge plan

Airlines have raised concerns over excessive charges for using London's main airports

Air passengers received good news after aviation regulators proposed major changes in the way airlines are charged for using London's three main airports.

The proposals from the Civil Aviation Authority (CAA) will mean airlines will be charged far less for using Heathrow, Gatwick and Stansted Airports from 2014-19 than they were for the 2009-14 period. This will, in turn, limit the fare rises that would be imposed on passengers at these airports.

The CAA proposals, to be finalised next year, also provide cheer for the airlines which have been arguing against what they see as excessive charges.

Heathrow, Gatwick and Stansted are the only airports regulated by the CAA, which can cap the amount airport bosses can impose on airlines in take-off and landing fees.

For 2014-19, the CAA has proposed that airline charges at Heathrow should be capped at the RPI rate of inflation minus 1.3%.This is far less than the figure of RPI plus 7.5% for Heathrow for 2009-14. It is also far less than the 2014-19 charge figure proposed by Heathrow bosses, which would have see charges increase at the west London airport from the equivalent of £19.33 per passenger for 2012/13 to as much as £27.30 for 2018/19.

For Gatwick, where bosses had pressed for complete deregulation, the CAA proposed a much more flexible system but still underpinned by a licence from the CAA.

The CAA said this new approach would require effective airport-airline collaboration, and that so far "the airport has not yet made acceptable proposals along these lines". If nothing can be sorted out, the CAA said charges for 2014-19 at Gatwick would be capped at RPI plus 1% which is lower than the RPI plus 2% regime that has been in place at the West Sussex airport for 2009-14.

At Stansted, where Ryanair chief executive Michael O'Leary has long complained about the level of charges, the CAA's regulation will take the form of monitoring charges and service quality. The CAA said this would ensure passengers at the Essex airport were protected while minimising the regulatory burden on airport and airlines. But the CAA said it might impose more detailed regulation "unless prices at Stansted reduce over time".

Willie Walsh, chief executive of British Airways' parent company IAG, has spoken out strongly against the levels of charges at Heathrow. Responding to the CAA proposals, he said: "Heathrow airport is over-priced, over-rewarded and inefficient, and these proposals, which will result in an increase in prices, fail to address this situation.

"In the past the CAA has rewarded Heathrow for inefficiency and it is now the most expensive hub airport in the world. Its charges have tripled in the last 11 years with inflation-busting increases year on year."

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