Business Irish

Tuesday 2 September 2014

O'Leary lashes UK aviation board over Stansted charges

John Mulligan

Published 29/04/2013 | 05:00

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Ryanair chief Michael O'Leary
Ryanair chief Michael O'Leary

Ryanair boss Michael O'Leary has again lashed out at the UK's Civil Aviation Authority (CAA), claiming it's been "sitting on its hands" while charges at the airline's biggest base – Stansted – climb.

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Mr O'Leary was incensed earlier this year when the former owners of Stansted secured approval for a 6pc increase in landing charges just days before the airport was sold for £1.5bn (€1.78bn) to Manchester Airports Group (MAG).

He has just written a fresh complaint to the CAA. Stansted was sold by Heathrow Airport Group, formerly BAA, which is majority controlled by Spanish construction group Ferrovial.

It was forced to sell Stansted after a ruling by the UK's Competition Commission.

The watchdog ordered the sale of Stansted and either Glasgow or Edinburgh airport in order to boost competition.

Ryanair is Stansted's biggest customer, accounting for about 70pc of its business.

While Mr O'Leary initially welcomed the sale of Stansted, he was later angered when it emerged the price hike had been approved prior to a sale.

That increase was pushed through despite traffic at Stansted being in decline.

Mr O'Leary accused it of being a "sweetener" to encourage Manchester Airports to buy Stansted and urged the CAA to investigate.

Probe

But Iain Osborne, the CAA's group director of regulatory policy, refused to initiate such a probe. He told Ryanair that the price increase was in line with the permitted price cap and that there was "no reason" for the CAA "to question the airport's motives".

"It is inconceivable that any regulator, charged with protecting the reasonable interests of airport users, would not investigate why Ferrovial, on the week before they handed over Stansted to MAG, imposed a 6pc price increase . . . which will clearly be of no benefit to Ferrovial," Mr O'Leary said in a letter to the CAA this month.

Ryanair has scaled back its presence at Stansted due to the increased charges.

Passenger numbers at Stansted have fallen from about 24 million in 2007 to 17.5 million in 2012.

In March, Ryanair announced that it would cut the number of flights it's operating out of Stansted by 9pc over the next year.

That will see 170 flights across 43 routes a week axed.

The CAA is due this week to reveal its preliminary views on maximum landing charges at Stansted, Gatwick and Heathrow airports for the next five-year regulatory period that begins in April next year.

Irish Independent

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