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Friday 29 July, 2011

Civil Aviation Auth.

CAA LAUNCHES REVIEW OF PRICE AND SERVICE QUALITY

RNS Number : 3071L
Civil Aviation Authority
29 July 2011
 



News Release

29 July 2011

 

 

CAA LAUNCHES REVIEW OF PRICE AND SERVICE QUALITY REGULATION AT HEATHROW, GATWICK AND STANSTED AIRPORTS

The UK Civil Aviation Authority (CAA) has today published its first consultation on the future of price and service quality regulation at Heathrow, Gatwick and Stansted airports.  Informed by extensive discussions with airlines, airports, investors and other stakeholders, 'Setting the Scene for Q6' (which can be read online here) sets out the CAA's initial views on how it plans to approach its review and the key issues that will shape the agenda for the work.

The document is being published against the backdrop of the Government's intention to reform the framework for airport economic regulation by introducing a new primary duty for the CAA that unambiguously puts passengers' interests first.  The legislation will also introduce a new licence regime for airports with substantial market power, backed up by financial penalties, in line with other economic regulators.  These measures should allow regulation to be tailored better to meet the requirements of passengers at individual airports.

Commenting on the announcement, Andrew Haines, CAA Chief Executive, said: "The CAA's aim is to put passengers' interests at the heart of our economic regulation and we are keen to ensure that our reviews at Heathrow, Gatwick and Stansted reflect the unique position of each airport.  Given the importance of the reviews for the future of these airports, it is vital that everyone with an interest has an opportunity to engage with our review and have their voice heard.  This will help deliver a regulatory regime that supports improvements to the passenger experience and efficient collaboration between airports and airlines, and maintain the confidence of investors."

Under existing legislation, every five years the CAA is required to set the maximum price levels that the three airports can charge airlines, as well as imposing service quality standards, backed up by rebates to airlines if the airport fails to meet them. Today's document is the first stage in the process to set the price and service quality levels after April 2014.

 

Notes to Editors

1.   The CAA's full document can be found here: www.caa.co.uk/docs/5/Q6SettingScene.pdf

2.   The CAA is the UK's specialist aviation regulator. Its activities include: making sure that the aviation industry meets the highest technical and operational safety standards; preventing holidaymakers from being stranded abroad or losing money because of tour operator insolvency; planning and regulating all UK airspace; and regulating airports, air traffic services and airlines and providing advice on aviation policy from an economic standpoint.

3.   Q6, the period covered by the new regulatory arrangement, will begin for all three airports in April 2014.  In March 2011 CAA extended the current price and service quality control period at Heathrow and Gatwick (known as Q5) to run until 2014, which will align with the expiry of Q5 at Stansted. 

4.   The Government expects to introduce the legislation to implement their reform proposals early in the Second Session of the current Parliament.  However, without being certain of the final shape of the reforms and that they will successfully pass through Parliament the CAA cannot start to develop Q6 as it would if the new arrangements were certain.  As such, extending the current controls was the best way to try and maximise the chance of aligning the next ones with the expected new legislation while minimising upfront cost and risks for stakeholders. 

 

 


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