The Australian Competition and Consumer Commission today issued its decision on Canberra Airport's proposals to increase charges to fund a major apron expansion at the airport.
The decision is to approve a charge of $0.589 per arriving and departing passenger.
"The decision allows construction of additional aircraft parking bays to service airline operating requirements at the airport", ACCC Chairman, Professor Allan Fels, said today. "The new apron is a common user facility that will be available to all airlines. It will cater for Impulse Airlines and other new entrants as well as catering for growth by Qantas and Ansett.
"The regulatory arrangements covering Canberra Airport and other price capped airports allow airport operators to apply to the ACCC to recover the costs of necessary new infrastructure expenditure through charging increases outside the cap. These provisions were designed to provide incentives for the timely development of necessary new aeronautical infrastructure.
"The new investment provisions encourage airport operators and users to consult on the investment needs of the airports and the prices associated with the new investments.
"In this case not all users agreed on the need for the apron expansion. Ansett and Impulse supported the project, while Qantas did not. The lack of agreement made the ACCC's consideration of Canberra Airport's proposals more difficult. The operational issues involved need to be resolved by the industry. In this instance Canberra Airport, Impulse and Ansett undertook detailed consultation. Qantas did not participate in the process. I encourage all parties to work together to resolve the issues.
"The charge approved is lower than the charge proposed by Canberra Airport. The reason for this is that the ACCC's decision adopts a lower rate or return and lower land rental charges than proposed. Also costs associated with the development of a Master Plan were excluded.
"In making its decision the ACCC expressed reservations about the charging structure proposed. Canberra Airport opted for a per passenger charge. However, passenger numbers do not accurately reflect resource consumption. Aircraft size and weight are the primary drivers of apron costs. Aircraft MTOW (maximum take-off weight) based charges capture this more effectively than passenger based charges. For this reason the ACCC encourages CAG to reconsider its approach and consult further with airlines".
Copies of the decision will be available on the ACCC web-site (www.accc.gov.au) on the airports page.