Stansted airport criticised by Competition Commission
[November 5th 2008]
In its Stansted airport charges report the Competition Commission has found that the airport failed to consult adequately with airlines and to effectively manage security queues.
The Competition Commission (CC) believes Stansted airport has acted against the public interest by failing to consult properly with airlines on the development of the airport and its capital expenditure plans and by not managing the security queuing process.
The CC is recommending that the Civil Aviation Authority (CAA) asks airport operator BAA to improve the consultation process and to introduce a service quality rebate scheme similar to those at Heathrow and Gatwick airports which would impose financial penalties on BAA if Stansted failed to meet agreed standards.
The CC has also recommended an increase in the maximum level of airport charges at Stansted to £6.26 per passenger (compared with the current charge of £6.05) with an increase of no more than RPI +1.75% each year. BAA wanted £6.38 per passenger and an annual increase of RPI +7.1%.
The CAA says it will now have discussions with BAA and airlines at Stansted before issuing for consultation its own price control and other proposals for Stansted by December 9th. Final price control decisions will be made in March to come into effect for the five year period starting on April 1st 2009.
BAA has responded by saying: "We are disappointed that the Competition Commission has failed to reflect large elements of the costs involved in operating Stansted Airport over the next five years and beyond. While the CC supports BAA's development proposal for the second runway (Stansted Generation 2), it is important that regulators fully consider the cost of taking such ambitious proposals from the drawing board to reality”.
The report has had a mixed response from airlines at Stansted. easyJet has welcomed the CC’s recommendations. “In the current economic climate, more than ever the flying public needs to be protected from monopoly abuse and the CC is to be congratulated for its clear-headed analysis,” an easyJet spokesperson said.
But rival low cost airline Ryanair warns: “The price increases identified in the CC’s report further reward the BAA monopoly and will further reduce passenger numbers at Stansted Airport”.
Ryanair is renewing its call for Stansted airport to be sold. “It is now clear that BAA needs to be forced to immediately sell off Stansted airport in order to allow the market to introduce lower prices and better services for consumers,” says Ryanair spokesperson, Jim Callaghan.
Written by: Nick Purdom