UK CAA ups pax protection

Travellers to the UK can breathe a sigh of relief after the UK Civil Aviation Authority implemented proposals for the economic regulation of Heathrow, Gatwick and Stansted airports.

The proposals will see airlines charged less for using the airport from 2014-2019 than they were for the 2009-14 period. This will, in turn, limit the fare rises that would be imposed on passengers at these airports.

For 2014-19, the CAA has proposed that airline charges at Heathrow should be capped at the RPI rate of inflation minus 1.3%. At Gatwick, the CAA has capped prices at RPI plus 1% for the five years from April 2014.

Stansted showed the weakest evidence of market power, but the CAA believes that it is likely to grow stronger between 2014 and 2019 as capacity around London becomes even more constrained. Regulation at Stansted will take the form of the CAA monitoring price and service quality – this will ensure that users are protected while minimising the regulatory burden on airport and airlines. However, the CAA may impose more detailed regulation unless prices at Stansted reduce over time.