CAA’s ‘final’ proposals for London airport prices may be trying to reconcile the irreconcilable

The UK CAA's mind-numbingly long and complex review of airport charges at Heathrow, Gatwick and Stansted is almost complete. In the five-yearly process, the regulator consults with airports and airlines. It publishes proposals and amends proposals, trying to reconcile the irreconcilable.

Between 2007 and 2012, aeronautical income per passenger at Heathrow almost doubled; at Gatwick it rose by more than two thirds; and at Stansted it grew by 43%. They all beat the 14% increase in the UK's Retail Price Index over this period. Airlines now want prices to fall, while airports seek further increases to pay for planned capital expenditure and to reward investors.

The usual result of the review is that neither side is pleased. After the publication on 3-Oct-2013 of the CAA's 'final' proposals for price caps from 2014 to 2019, the usual result looks likely again at Heathrow. At Gatwick, the CAA might just find common ground between the two sides. At Stansted, it seems the regulator has been by-passed entirely. Final decisions are due in Jan-2014.