23 Mar 2010

Passengers set to pay for air traffic control price hike

9:43 am on 23 March 2010

Passengers are set to pay for an increase of 9.65% in the price of air traffic control services for airlines.

Airways, the company that runs traffic control, has been collecting less money from airlines because fewer people are flying during the economic downturn.

It says it realises the timing of the planned increase will be crushing for the carriers.

Board of Airline Representatives executive director John Beckett says carriers cannot absorb the rise and passengers will ending up paying.

"Airlines have been competing hard and they just don't have a lot of room to absorb cost increases.

"So inevitably, any increases in air navigation charges end up as additional costs to the airlines which they have to recover one way or another."

It is not clear how much more passengers would have to pay, as Airways runs a range of services with a detailed pricing structure.

The Aviation Industry Association is also raising the prospect of airports operating their own air traffic control.

Airways is seeking feedback on its new pricing proposal, which it aims to introduce from 1 July this year.