EXISTING regulation of Australian airports has been endorsed by The Productivity Commission (PC) into the Economic Regulation of Airports, which has released its draft report today.
The findings indicate that the four airports monitored – Sydney, Melbourne, Brisbane and Perth – “have not systematically exercised their market power to the detriment of the community”.
The document said each airport generated returns sufficient to promote investment while not earning excessive profit and most of the airports’ operational and financial performance was within “reasonable bounds”.
“The current form of economic regulation remains fit for purpose although more scrutiny of Australia’s four busiest airports is justified to ensure prices paid by airlines and passengers do not lead to monopoly profits,” said Commissioner Paul Lindwall.
The draft report suggested the four airports be required to separately report revenues and costs of providing domestic and international services to airlines and warned there was no reason for airport operators to become complacent.
The PC flagged concerns about some aspects of the performance and questioned whether some clauses in contracts between airports and airlines were anticompetitive.
The draft report has been slammed by Airlines for Australia and New Zealand (A4ANZ), which called for an urgent rethink by the Productivity Commission.
A4ANZ Chair Graeme Samuel said “It beggars belief that the PC could simply set aside such highly credible evidence from experts both in Australia and internationally in their choice not to suggest real change”.
Source: traveldaily