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Ryanair renewed its call for the dismissal of the CAA’s Harry Bush, the Regulator who has announced proposals for increases to passenger charges at London Stansted of between GBP4.00 and GBP7.00, an increase of 150%. Ryanair stated that this more than doubling of already high passenger charges demonstrates just how ineffective regulation is and Ryanair is calling for the immediate breakup of the BAA airport monopoly in order to replace this “inadequate” regulation with competition.
Ryanair highlighted the recent record of the CAA in regulating the Stansted Airport monopoly:
1. Stansted’s traffic is ahead of their forecasts and their capital expenditure is significantly behind forecast, yet passenger charges at Stansted have risen, not fallen;
2. CAA stood idly by in Apr-07, when BAA Stansted doubled passenger charges;
3. Despite the regulatory cap, which limits BAA Stansted’s income at 7% of capex this year, thanks to better than expected passenger numbers, and the doubling of prices last April, BAA Stansted will recover approximately 14% of its capital or double that allowable under the cap;
4. Instead of depreciating Stansted’s assets each year, CAA allows BAA to increase the value of these assets by inflation, thus double charging passengers;
5. CAA failed to intervene over the past two years at Stansted when thousands of passengers were stuck in long security and boarder control queues. The UK Competition Commission’s recent interim review on its investigation into BAA’s market power found that:
a. The BAA’s monopoly ownership of Edinburgh and Glasgow airports has adversely affected competition;
b. The BAA’s monopoly ownership of Heathrow, Gatwick and Stansted airports has adversely affected competition;
c. The way the BAA monopoly has conducted its business has adversely affected competition; and
d. The inadequate regulatory regime operated by the CAA has adversely affected competition.
According to Ryanair, The CAA has ignored volumes of evidence from Stansted airlines, the findings of the OFT, DfT and now the CC, all pointing to the conclusion that BAA Stansted is an abusive monopoly. Ryanair has long called for the break-up of the BAA monopoly in London and for the three main airports to compete against each other.
© Centre for Asia Pacific Aviation. Date posted: 30-Apr-08
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Ryanair calls for “inadequate” Regulator to be replaced with competing London airports 
