Stansted operator rapped by competition chiefs

Under-fire airport operator BAA has fallen foul of competition chiefs again, it was revealed today.

In a report today, the Competition Commission (CC) said BAA had acted against the public interest in relation to waiting times at Stansted and with regard to consultation with airlines over expansion at the Essex airport.

But the CC, which has already recommended a break-up of BAA’s UK airport “empire”, did not agree with Ryanair’s claim that airlines were being charged excessively for using Stansted.

And the CC recommended increased charges for the period 2009-14 with a final decision due from the Civil Aviation Authority (CAA) in March 2009.

The CC said today that it had received strong criticisms about the quality of service at Stansted over recent years.

The commission said: “This poor performance was in part due to the new, and more onerous, security arrangements introduced by the Department for Transport in August 2006, but we believed that BAA could have done more to meet the needs of its customers in the period (February 2002 to April 2008).

“We recognised that, more recently, BAA’s performance had significantly improved in this area but, over the period as a whole, we found that Stansted failed to manage security queuing and queue times to avoid unacceptable delays to passengers, crew and flights, and consequently did not further the reasonable interests of the users of the airport.

“We concluded that BAA’s conduct had operated against the public interest.”

The CC has now recommended that BAA be subject to the same service quality rebate scheme to that in operation at Gatwick in which BAA has to pay penalties to airlines in the event of poor performance.

On BAA’s consultation processes over expansion plans at Stansted, the CC said: “We found that BAA’s approach to consultation with its airline users raised significant concerns.”

The CC spoke of BAA appearing to make “no real effort to involve the airlines” and this failure to consult had “tended to lead to an entrenched division and lack of co-operation between Stansted and its users”.

The CC recommended that BAA improve its consultation process and the information it provided to airlines.

In its report the CC recommended that maximum charges to airlines using Stansted should rise to the equivalent of £6.56 (€8.16) per passenger in 2009/10, with charges after that rising by no more than 1.75% above retail price index inflation, reaching a maximum of £7.05 (€8.77) per passenger in 2013/14.

This compares with charges of £6.34 (€7.89) per passenger in 2008/09.

A spokesman for BAA said: “We are disappointed that the Competition Commission has failed to reflect large elements of the costs involved in operating Stansted Airport over the next five years and beyond.

“While the CC supports BAA’s development proposal for the second runway (Stansted Generation 2 – SG2), it is important that regulators fully consider the cost of taking such ambitious proposals from the drawing board to reality.

“We continue to believe that SG2 is a sound project which will begin to address the shortage of runway capacity so often cited as a problem by organisations such as the CAA, the CC and Government and look forward to continued discussions with the CAA.”