The International Air Transport Association (IATA) has urged for strong economic regulation of Australian airports amid concerns about the effectiveness of the price monitoring regulatory system for airport charges in the country.
IATA director general and CEO Alexandre de Juniac pointed toward the need to justify the airport charges, saying that travel by air has become cheaper now than it was a decade ago; however, airlines and passengers have not seen similar decreases in airport costs.
“The difference is that airlines operate in a competitive environment while airports have much more market power. We must find an effective regulatory solution to ensure that Australia is well served with competitive infrastructure.”
The Australian Competition and Consumer Commission (ACCC) expressed its concerns last year about the effectiveness of the country’s price monitoring regulatory regime for airport charges and whether it does enough to constrain the market power of Australia’s main airports.
IATA said that it agrees with the ACCC’s view.
At present, IATA is working with Airlines for Australia and New Zealand and the Board of Airline Representatives Australia (BARA) to give input to the Productivity Review on Economic Regulation of Airport Services taking place this year.
At the Australasian Aviation Press Club, Juniac also shed light on other topics relating to Australian airports.
Juniac further added: “The apprehension of potential aircraft bombers in Sydney last year was a grim reminder that aviation remains a target for terrorists.
“We welcome the nearly A$300m ($227m) that the federal government has allocated to further improve security at airports. As this is rolled-out, we must carefully ensure that associated cost don’t leak back to the airlines.”