Airports welcome commencement of Productivity Commission review

 

Australian Airports Association (AAA) Chief Executive Officer Caroline Wilkie today welcomed the release of terms of reference for the next scheduled review of the economic regulation of airports by the Productivity Commission.

 

She said the AAA looked forward to engaging with the Commission and inquiry participants on how airports plan to continue to facilitate aviation growth that benefits the community and the economy as a whole.

 

“In the last 20 years airports have worked tirelessly to encourage new airlines to Australia and build better facilities to make it easy and affordable for passengers to travel more often,” Ms Wilkie said.

 

“Australia’s major airports have invested $11.5 billion in improvements over the last 10 years, ensuring passengers now enjoy better terminals, more choice and cheaper airfares.”

 

“At the same time, airport investment has supported greater efficiency for airlines to support their growth and success.”

 

Previous Productivity Commission reviews of airport regulation have endorsed the current, light handed regulatory approach that has supported these outcomes, as have successive Labor and Coalition governments in their responses to the Commission’s findings.

 

The ACCC also recently acknowledged the importance of airport investment, and the need for continued investment to support future growth.  The AAA shares that view.

 

“Airports continue to work constructively with airlines to invest to meet growing demand and provide passengers with better airport experiences and even more travel options in the future,” Ms Wilkie said.

 

“Recent evidence of this includes the announcement of major infrastructure investment by Adelaide Airport.

 

“Unlike other infrastructure around the country, these outcomes are being achieved without a cost to the taxpayer.”

 

Ms Wilkie said maintaining the current regulatory approach would give investors the certainty required to continue financing new runways, terminals and technology to support aviation and tourism growth in the future.

ENDS

 

About the Productivity Commission review

 

The Productivity Commission will this year review the economic regulation of airports. It will be the fourth time the Commission has conducted the review since airports were privatised 21 years ago. It was scheduled by the Australian Government in 2012.

 

The current regulatory approach was put in place after the Productivity Commission found in its 2002 report that a heavy handed price control framework was both unnecessary and potentially harmful.

 

In 2006, the Productivity Commission found airport charges in Australia were reasonable, efficiency was good, investment was strong and profits were not unreasonable. Later in 2011, the Productivity Commission highlighted the marked increase in aeronautical investment since privatisation.

 

The AAA will provide a submission to the Productivity Commission this year and looks forward to taking part in the process.

 

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