Heathrow told to reduce passenger charge

Heathrow has been told to cut passenger charges for airlines each year until 2026 by the Civil Aviation Authority.

At the moment Heathrow charges airlines £30.19 per passenger, and the CAA says it wants the cap on the average charge per passenger to fall to £26.31.

But Heathrow wants to charge £41.95 for the cost of operating terminals, runways, baggage systems and security.

The charges are paid by airlines, but can then be passed onto passengers via airfares.

The CAA said the plan to reduce the charge “reflects expected increases in passenger numbers as the recovery from the pandemic continues and the higher level of the price cap in 2022, which was put in place in 2021 to reflect the challenges from the pandemic at the time”.

In December 2021, Heathrow was given permission to raise the passenger charge from £19.60 to £30.19.

The aviation regulator is consulting on its plan to reduce that charge and expects to make a final decision in the autumn.

Richard Moriarty, chief executive of the CAA, said the planned reduction in charges “is about doing the right thing for consumers”.

“We have listened very carefully to both Heathrow Airport and the airlines who have differing views to each other about the future level of charges,” he said.

“Our independent and impartial analysis balances affordable charges for consumers, while allowing Heathrow to make the investment needed for the future.”

However, Heathrow chief executive John Holland-Kaye said the regulator “continues to underestimate what it takes to deliver a good passenger service, both in terms of the level of investment and operating costs required and the fair incentive needed for private investors to finance it”.

“Uncorrected, these elements of the CAA’s proposal will only result in passengers getting a worse experience at Heathrow as investment in service dries up,” he said.