BAA needs even higher charges at London airports

Premium Analysis

In the latest twist in the London airports charges saga (which

could ultimately reshape the ownership structure of the UK's major airports),

the Civil Aviation Authority (CAA) has recommended BAA be allowed to increase

charges at Heathrow by 15.6% in Apr-08 to GBP11.97 per passenger and by 7.5%

above inflation p/a for the following four years. It is an increase from an

earlier proposal for inflation plus 5.8%. Gatwick charges should rise 8.2% to

GBP6.07 and then by inflation plus 2%, according to the CAA. The CAA is also

proposing tougher financial penalties for BAA for the late delivery of capital

spending projects and any failures to meet service standards.

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