Below-cost airport passenger charges ‘incomprehensible’, says DAA chairman

Dublin Airport cannot face a third year of enforced below-cost passenger charges, Basil Geoghegan, chairman of its parent company, will warn politicians on Wednesday.

Mr Geoghegan, reappointed by the Government as chairman of State airports company DAA, will tell the Oireachtas Committee on Transport and Communications that Covid-19 has voided passenger charges set for Dublin by regulators in 2019.

“Our business simply cannot countenance a third year of enforced below-cost prices and regulatory inaction,” Mr Geoghegan will warn TDs and Senators when the committee quizzes him on Wednesday.

As soon as a planned shake-up of air travel regulation is complete, he says the newly constituted Irish Aviation Authority (IAA) should immediately set a price cap for 2022 that reflects current market conditions.

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The Commission for Aviation Regulation ruled in 2019 that DAA should cut passenger levies on airlines by 18 per cent to €7.87 a head over the five years to 2024.

DAA appealed this, arguing the decision endangered plans for a €2 billion investment needed to prepare Dublin Airport for growth through this decade.

Mr Geoghegan’s opening statement to the committee maintains the commission’s 2019 decision is a fundamental issue for the future provision of airport infrastructure and those depending on it.

He describes as incomprehensible that Dublin’s charges are still tied to forecasts from 2019, when the airport handled 32.9 million passengers, despite a historically high plunge in air travel.

“Despite repeated requests, the now departing regulator has not taken any decisive action whatsoever to address the situation,” he says.

Dominant position

The Commission for Aviation Regulation, responsible for consumer protection, sets Dublin Airport’s charges as it enjoys a dominant position in the Republic.

Planned restructuring of regulation will merge the commission with the safety regulation arm of the IAA, whose air traffic control and navigation unit will be split into a separate body. Meanwhile, the commission's head, Cathy Mannion, is leaving to join a European Commission performance review body for air navigation services.

Mr Geoghegan points out airports and airlines responded speedily to the pandemic-induced crisis in air travel.

“Yet almost 20 months after this crisis began there has been no change to charges that were predicated on five times the passenger volumes delivered to date this year,” he says.

Mr Geoghegan states that Covid-19 has shrunk DAA’s thriving global business back to levels last seen 30 years ago, costing €284 million in losses last year.

He says that after a long period of restrictions, DAA is focused on catching up with other countries.

"We are working with the airlines and tourism authorities to reconnect Ireland to the world," he says.

Mr Geoghegan added that the company welcomed the Government’s €90 million aviation aid package announced in Budget 2022.