Dynamic Business

The Australian Government will bring forward a scheduled review of airport regulation and pricing after the ACCC released a report yesterday which suggested Sydney Airport may be using it’s monopoly position to generate unfair returns by charging higher prices.

Sydney International Airport, of which 74 percent is owned by Macquarie Airports Group was for the fourth year running, awarded last place amongst Australia’s five major airports in a report by the Australian Competition & Consumer Commission.

The ACCC report found that while Sydney Airport’s ‘aeronautical revenue’ increased by 5.4 percent, passenger numbers actually decreased in the year to June 2009. This lead to the conclusion that Sydney Airport was likely to be abusing its market position and unfairly charging users of its facilities.

“The indications are that Sydney Airport has increased profits by permitting service quality to fall below that which the airlines reasonably expect,” ACCC chairman Graeme Samuel said.

In response to the ACCC’s submission, Federal Transport Minister Anthony Albanese has asked the Productivity Commission to move their planned review of pricing and regulatory regimes for airports forward from 2012 to before the end of this year.

“As a result of this ACCC report I have asked the commission to bring that forward to as soon as possible,” Mr Albanese said

“The former government had a tick-and-flick approach to airports. I won’t be doing that,” Albanese told reporters. “All the airports are on notice and they know that the government expects them to lift their game.”

While the airports are leased to private operators, Mr Albanese is confident the government can influence the airport operators.

“What we can do is ensure that we have appropriate monitoring mechanisms there and that we hold them to account.” Mr Albanese said.

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