Australian travellers could face higher airfares if a controversial proposal to more than double the fees paid by our major carriers is approved.
Airservices Australia has submitted a new long term pricing scheme that would significantly increase the charges airlines pay for air traffic control, aviation rescue and firefighting services over the next five years.
Airservices says the additional revenue is needed to modernise critical aviation infrastructure, improve frontline services and help fund major projects such as the long awaited OneSKY air traffic management system.
However, Airlines for Australia and New Zealand (A4ANZ), which represents carriers including Qantas, Jetstar, Virgin Australia, Air New Zealand and Regional Express, has condemned the proposal.
The group claims it would add around $150 million a year in extra costs to the aviation sector and would increase Airservices’ charges by more than 100 per cent over the life of the agreement.
Professor Graeme Samuel, A4ANZ Chair, slammed the proposal, which comes at a time when airlines and passengers are already facing rising operating costs.
“This is an extraordinary price hike from a government-owned entity that has too often failed to deliver the services airlines and travellers need and are already paying for,” he said.
“Airservices Australia has been repeatedly criticised for disruptions caused by air traffic control staffing failures.
“Flights have been delayed and cancelled due to Airservices rostering failures. It is simply not good enough to ask travellers to pay dramatically more for a service that is failing to meet reasonable expectations.”
While airlines pay Airservices directly, industry experts say major increases in operating costs are often reflected in ticket prices over time, meaning travellers could ultimately shoulder part of the burden through higher fares.
Airservices Australia has defended the proposal, noting that its prices remained unchanged for a decade before a six per cent interim increase took effect last year.
It says the organisation has faced significantly higher operating costs while continuing to invest in Australia’s aviation network and future technology.
The government owned agency said its proposed pricing framework had been developed following extensive consultation with airlines, government departments and the Australian Competition and Consumer Commission (ACCC).
The ACCC is now assessing the draft price notification before it proceeds to the Federal Government for ministerial consideration.
Any new pricing arrangements will require the necessary regulatory approvals before they can take effect.
