Transport secretary Ruth Kelly announced today (15 January) that Manchester Airport will be de-designated ” and therefore able to set its own charges ” but that Stansted will continue to be regulated by the Civil Aviation Authority (CAA).
Kelly said CAA regulation was ”the best way of protecting passengers” who use Stansted. Regarding Manchester, she commented: ”I have taken into consideration the fact that other local airports, such as Liverpool airport, offer real choice for passengers.
”The decision to de-designate will enable the airport to grow and develop without the costs of excessive regulation falling to passengers in the future.”
But regarding the London airport, the Department for Transport (DfT) does not think competition is sufficient to keep a check on unreasonable price rises by BAA, the UK airports group which also owns Heathrow and Gatwick.
The CAA ” which had advised the DfT to end price controls at Stansted, saying regulation cost a lot of money and that it believed market forces alone would keep prices down ” said: ”At first sight, there appear to be differences between the Government”s analysis of competitive conditions in the market in which Stansted operates and the CAA”s analysis. Insofar as these differences are relevant to setting price controls, the CAA will examine the Government”s analysis carefully.”
Kelly said she had ”taken into consideration the fact that the airports in the south-east are operating at almost full capacity,” which is bad for passengers and ”for the UK”s productivity and growth.
”This is why the government supports a second runway at Stansted and is currently consulting on adding capacity at Heathrow. Until this new capacity can be delivered, the CAA plays an important role in protecting passengers.”
Predictably, Ryanair and easyJet ” the two major operators out of the London airport ” are delighted at the decision, with both wanting to keep in check what they see as BAA”s monopoly. An easyJet statement said the Authority ”controls more than 90% of London”s airport capacity.”
EasyJet planning director Andrew Barker said today: ”Without regulation, customers would be at the mercy of a highly-indebted infrastructure owner seeking short-term profit maximisation at the expense of air travellers.”
And the Stansted Airline Consultative Committee chairman, David O”Brien, also welcomed the decision: ”While the CAA was busy attempting to deregulate Stansted, BAA doubled passenger charges, which is driving traffic away from the airport and depriving consumers of choice.”
