Consultation Responses

In November 2007, the Civil Aviation Authority (CAA) published its proposals for price controls on airport charges at Heathrow and Gatwick for the five year period of 1st April 2008 to 31st March 2013. These controls set the amounts airports can charge airlines for using the airport and align themselves with the recommendations of the Competition Commission.

The proposals are:

Heathrow

£11.97 per passenger in 2008-09 – a 15.6% increase from the current price cap. Charges are allowed to increase in each of the following four years by no more than RPI inflation plus 7.5% each year, reaching £15.90 in 2012-13.

Gatwick

£6.07 per passenger in 2008-09 – an 8.2% increase from the current price cap. Charges are allowed to increase in each of the following four years by no more than RPI inflation plus 2%, reaching £6.57 in 2012-13.

The justification for these increases includes increased cost of security operations, the cost of recent capital projects and allowances for significant additional capital expenditure. The CAA also noted that both airports are performing close to capacity, with Heathrow the world’s busiest international airport and Gatwick the world’s busiest single-runway airport.

Through these proposals the CAA is seeking to give incentives to the British Aviation Authority (BAA) to deliver a better service to passengers and to airlines. Therefore, the CAA is putting forward a broader and stronger set of financial incentives on each airport for improved passenger facilities and services.

The impact of these proposals for domestic air service connections, linking regions to Heathrow as a major international gateway cannot be overstated. They have strong implications for the two airports in the North East – Newcastle International and Durham Tees Valley airport.

In consultation with its members, the Association has responded to this document.

View Civil Aviation Authority price control response (Jan 2008).pdf