Airport Privatisation in Canada: Transport Policy Review

There is a consensus across Canada and beyond that the country's airports are too expensive, and high charges to airlines trickle down to the passenger. There has been a tendency for several years now that Canadians living close to the US border seek out international flights, in particular, from a string of US airports right across the country, east to west.

One of the main reasons for the high operational cost is that the government demands annual lease payments (ground rent) from the airports as a condition of their devolvement from central government control in 1994.

Now the government has released a weighty review document, one of whose chapters recommends that, in order to escape from the constant undermining of competitiveness that the lease system sustains, small federally owned airports should be divested to local governments, while larger ones should be privatised so that they can tap into financing from institutional investors. The document even goes so far as to provide an appendix of privatisation options.