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Productivity Commission says "no problem"
The Productivity Commission has announced finding “no evidence of systematic misuse of market power” by the nation’s top six airports, saying there were “good reasons” for the present “light handed” approach to continue until its next review in 2012.
Handing down the draft findings of its first review since the Federal Government removed aeronautical price caps in 2002, the commission said Australian airports still delivered “reasonable value for money” in an international context.
“The productivity performance of Australian airports appears to be high by international standards – with one study suggesting that this may be partly attributable to Australia’s less intrusive regulatory approach,” the draft report said.
It also said the deregulation of airport pricing had encouraged the building of commercial relationships between airlines and airports.
However, the commission acknowledged the behaviour of some airports in relation to “some non-price terms and conditions of access has arguably been less satisfactory”.
Therefore it recommended the Australian Competition and Consumer Commission’s monitoring of airport pricing should not only report on pricing changes but seek the “views of stakeholders on airport behaviour”.
Sydney Airport boss Russell Balding welcomed the draft findings even though the commission failed to back the airport’s request for deregulated pricing to be made permanent.
“It is clearly the most appropriate and efficient method of price regulation,” Mr Balding said in a statement.
Graham Muldoon
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