Civil Aviation Authority to launch consultation regarding paying for Heathrow’s third runway

The UK Civil Aviation Authority are expected to launch a public consultation on a proposed solution to the development costs of the third Heathrow runway in the coming weeks, reports the buying business travel website.

 

The CAA is supporting the negotiation of a commercial arrangement which is intended to allow the development costs for Heathrow’s new third runway to be spread over a larger passenger base. This follows concerns from some quarters in relation to guaranteeing that the governments affordability targets for expansion are met.

 

Heathrow has reached an agreement with airlines operating at the hub to potentially reduce passenger charges in exchange for increased load factors. Heathrow claims the deal has the potential to contribute to passenger charges seeing reductions of 10-20 per cent if the need for increased traffic figures is satisfied.

 

Airlines at Heathrow currently operate with load factors below the IATA global average, according to the airport. Heathrow says that hitting the averages would ensure it kept charges close to 2016 cost levels throughout the airport expansion project. This would in turn allow the airport to address concerns that the expansion will hit travellers in the pocket, instead delivering value for money, along with the benefits that a third runway will bring with it.

 

The Chief Executive Officer of Heathrow, John Holland-Kaye said:

 

Over the past several months, we’ve been working hard with our airline partners to agree a deal on airport charges to 2021. We are delighted that the result is the first-ever commercial agreement at Heathrow which will unlock hundreds of millions of pounds of potential investment for our passengers. We’ve shown that we can achieve more by working together and we will continue working to build on this momentum as we expand.”

 

Any of our readers wishing to know more about the issues leading up to and surrounding this decision, in advance of the consultation, can find a wealth of information on the CAA website here