IAG CEO Willie Walsh has called on the Civil Aviation Authority (CAA) to exercise greater control over Heathrow airport’s capital spending ahead of its proposed £14 billion third runway.
Writing in the Financial Times, Walsh said that while expansion at Heathrow represents a huge opportunity to prepare the UK for a post-Brexit world, he believes more must be done to reduce the cost of flying from the airport.
Walsh points out that airport charges at Heathrow are up to 65 per cent more than other European hubs. He blames “grossly inefficient day-to-day spending” for the charges and claims it makes Britain “uncompetitive”.
In his opinion article, Walsh states: “If Britain is to become a global trading powerhouse after Brexit, Heathrow will have to go from being one of the most expensive airports in the world to the most competitive.”
He goes on to blame the CAA, which oversees capital spending at UK airports, for turning a blind eye to Heathrow, saying the more it spends on projects, the more it can make for its shareholders. He pointed to a specific example of over-spending, saying British Airways (which is owned by IAG) asked Heathrow to provide three self-boarding gates at each of the 12 conventional boarding gates in Terminal 5, which it knew from discussions with suppliers would cost about £720,000. Heathrow quoted BA £7.8 million to complete the work, the cost of which would be passed on to the airline.
Walsh brings his article to a close by saying the CAA needs to ‘clamp down’ on Heathrow’s overspending in order to make it a more competitive and attractive airport.
Heathrow cut its domestic airport charges by £15 earlier this month. In December, it revealed plans to reduce its original estimate of £16.5 billion to build a third runway to the current £14 million cost.
A spokesperson for Heathrow Hub, an independent proposal to extend Heathrow's northern runway, said: “Willie Walsh is right to say the interests of passengers must be protected. Until now, the Department for Transport has paid no regard to passengers’ interests, yet it is ultimately they who will pay for the third runway. Our proposal is much cheaper, simpler and quicker, and both Heathrow itself and Chris Grayling, the secretary of state for transport, should admit they have made a mistake and adopt it instead.”