Airport upgrade on hold as passenger charge hike rejected
A billion euro upgrade of Dublin Airport was put on hold tonight after a hike in passenger charges to cover the cost of a new terminal was turned down.
Dublin Airport Authority officials had sought a 50% jump in fees to pay for a massive expansion plan but the Commission for Aviation Regulation rejected the request.
Instead a 23% rise in charges was granted from January 2006, increasing costs to €6.14 and leaving prospects for the €200m second terminal in jeopardy.
“The real losers here are passengers, the other users of Dublin Airport and the Irish economy as a whole,” said Declan Collier, DAA chief executive.
“We presented a comprehensive, integrated and progressive development plan for the airport but at this price there are profound implications for its delivery.
“As a result, the country’s key international gateway will remain constrained, our passenger service levels will continue to deteriorate and the operational efficiency of our airline customers will be affected.”
Authority bosses have warned the airport is reaching bursting point and insisted charges must increase to €7.50 a head to pay for the 10-year expansion plan and cater for 30 million passengers a year by 2015.
Airport bosses now fear there is no way the chronic congestion problems can be relieved. On peak summer days around 86,000 people pass through the airport – a full house in Croke Park on All-Ireland final day.
The DAA insisted €1.2bn was needed to bring the airport up to global standards and the move already had the support of Government and of business and tourism organisations including the Irish Hotels’ Federation, IBEC and the Chambers of Commerce of Ireland.
IBEC’s Director of Enterprise Brendan Butler warned: “As an island economy, Ireland is considerably more dependant on air transport than other countries.
“We simply cannot afford to go on with the over-stretched facilities and neither can we afford indecision and more delays.”
The IHF joined calls for action. “It would be disastrous if we were to now revert to a period of inaction and we see it as the Government’s responsibility that this is not allowed to occur,” IHF chief executive, John Power insisted.
“It is nationally imperative that this plan is kept firmly on track.”
On the day the Authority outlined plans for a second terminal, DAA chairman Gary McGann conceded that if the regulator rejected their request for a 50% increase in charges officials may have to go back to the drawing board.
“I think what we have looked at today, it will not go ahead if we do not get the rise,” he admitted at the launch.
The DAA claimed a €7.50 charge would still be a third lower than the average charge of other European airports of a similar size and stature. And the board noted that Dublin Airport’s charges have not increased since the late 1980s.
But the decision may also give entrepreneur Ulick O’Connor added incentive to push on with his plans for an independently owned and run terminal.
The Commission for Aviation Regulation claimed the DAA had not given enough time for the expansion plan to be fully assessed but that its decision, which is scheduled to last until 2009 could be reviewed.
The Authority said it will give the Government a full review of the impact of the Regulator’s decision as soon as it has had studied the decision in detail.
