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Heathrow users face fare hike as airport given green light to increase passenger charge

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Holidaymakers and frequent flyers are facing yet more misery, with Heathrow set to hike the price it charges airlines by up to £13 per person.

The London airport has been given the green light to raise the prices it charges carriers for its services from next year.

Currently the airport can charge up to £22 per passenger for the cost of operating terminals, runways, baggage systems and security.

Heathrow chiefs had wanted to charge as much as £43 from January – a plan slammed by airline bosses who accused the airport of acting like a ‘greedy monopoly’.

But industry regulator – the Civil Aviation Authority (CAA) – stepped in and ordered the cost to be capped at £25 to £35 for the next five years.

An interim charge of £30 has already been agreed for January – and is due to be discussed as part of a separate consultation in November.

The rising cost is likely to be passed on to airline passengers, who have already endured months of travel disruption, confusing travel restrictions and costly Covid testing requirements. 

Passengers arriving at the airport have also repeatedly faced queuing chaos at passport control – though Heathrow chiefs say the issue is entirely that of the UK’s Border Force. 

The rise, based on next year’s £30 figure, means the average family of four face an extra £32 in flight costs – before any annual ticket price adjustments from the airlines themselves.

It also comes as Heathrow this month introduced a new £5 drop-off charge outside its terminals.

However Heathrow chiefs have defended the hike, which is part of airport’s plan to claw back its huge losses suffered due to Covid.

The airport, the UK’s largest, reported a £2billion annual loss due to a huge drop in customer numbers last year.

Holidaymakers and frequent flyers are facing yet more travel misery, with Heathrow now set to hike the price it charges airlines by £8 per person

Holidaymakers and frequent flyers are facing yet more travel misery, with Heathrow now set to hike the price it charges airlines by £8 per person

Shai Weiss, CEO of Virgin Atlantic today slammed the decision, saying it ‘failed to protect the British consumer’.

‘Today’s initial proposals from the Civil Aviation Authority pave the way for Heathrow Airport to introduce unacceptable charges, just as international travel resumes at scale. 

‘The world’s most expensive airport risks becoming over 50 per cent more expensive, as Heathrow and its owners seek to recoup their pandemic losses and secure hundreds of millions in dividends to shareholders. 

‘It is concerning that the regulator has failed in its first opportunity to step in, and together with industry partners, we will oppose these proposals in the strongest terms to protect passengers.

Mr Weiss claimed the move could also hurt the UK’s economic recovery from Covid and would ‘unfairly hit the pockets of family and businesses’.    

Meanwhile, Rory Boland, Which? Travel Editor, said: ‘Which? research has previously found that airport charges are passed along to passengers through higher fares so any proposed increase by Heathrow is likely to come from consumers’ pockets.

‘Heathrow already has the highest fees of the UK’s major airports so it’s right that the CAA intervenes to investigate whether these further proposed increases are proportional.’ 

The cost of a family summer holiday could soar by up to £100 next year due to Heathrow airport's 'outrageous' price hikes, former British Airways boss Willie Walsh (pictured) warned last night

The cost of a family summer holiday could soar by up to £100 next year due to Heathrow airport’s ‘outrageous’ price hikes, former British Airways boss Willie Walsh (pictured) warned last night

It comes as a former British Airways boss warned last week that the cost of a family summer holiday could soar by up to £100 next year due to Heathrow airport’s ‘outrageous’ price hikes. 

Willie Walsh accused Heathrow of acting like a ‘greedy monopoly’ and said its wealthy shareholders must ‘step up’ to provide investment after years of generous dividend payouts.  

The Irishman, who now runs the International Air Transport Association trade body, had joined BA and Virgin Atlantic in lobbying the CAA to block the price hikes.

Mr Walsh said: ‘Heathrow must understand that gouging its customers is not the road to recovery for itself, the airlines, travel and tourism jobs, or travellers.

‘I have sympathy for some airports, but looking for a 90 per cent increase, I just find that outrageous.

‘There is simply no justification for that, and the only reason they are doing that is because they believe they can.

‘Instead, it’s time for Heathrow’s shareholders to invest. The recovery of the UK’s travel and tourism industry impacts millions of jobs. They cannot be held hostage to the intransigence of what is effectively a greedy monopoly hub airport.’

Heathrow’s seven billionaire owners include the sovereign wealth funds of Qatar, Singapore and China. 

It has paid out about £4 billion in dividends since 2012 and has said it could restart payouts next year, after pausing them over the pandemic, if its debts come under control.

Heathrow bases its charges on the numbers using the airport.  It expects around 40 million passengers next year, compared to 80 million before the pandemic, and said this means each passenger must pay more to cover the shortfall.

Company documents show Heathrow would have raised around £1.6billion from airport charges next year – had it been able to charge the higher rate it had requested.

But the new £30 charge is expected to only raise around £300million. 

CAA chief executive Richard Moriarty told the BBC the industry had gone through ‘a really difficult period’.

Mr Moriarty said the CAA’s proposals, which will be finalised next year, struck the right balance between consumer interests and the airport. 

Company documents show Heathrow would have raised around £1.6billion from airport charges next year - had it been able to charge the higher rate it had requested. But the new £30 charge is expected to only raise around £300million. (File image)

Company documents show Heathrow would have raised around £1.6billion from airport charges next year – had it been able to charge the higher rate it had requested. But the new £30 charge is expected to only raise around £300million. (File image)

The charge can still be contested by airlines, who are able to take the matter to the competition regulator – the Competition and Markets Authority.   

A Heathrow spokesperson told MailOnline: ‘Our aim is to reach a settlement that enables us to give passengers a great service while operating a safe, resilient and competitive hub airport for Britain.

‘That Heathrow is ranked by passengers as one of the best airports in the world is testament to the power of private investment over the past decade, and to enable this to continue, we believe the settlement should safeguard a fair return for investors. 

‘While it is right the CAA protect consumers against excessive profits and waste, the settlement is not designed to shield airlines from legitimate cost increases or the impacts of fewer people travelling. 

‘We look forward to discussing the CAA’s proposals in detail with the regulator and our airline partners as we work towards a new settlement.’

It comes as earlier this year Heathrow announced a new £5 passenger drop-off charge outside its terminals.

The new charge, bought in this month, applies to all vehicles – including taxis and private hire cars – entering the forecourt areas outside the airport’s terminals.

The fee must be paid online or over the phone, with number plate reading cameras, instead of barriers, being used to enforce the charge.

Heathrow chiefs say the move, which brings the airport’s policy in line with the likes of Gatwick and Manchester, who also have £5 drop-off charges, is aimed at ‘improving air quality and reducing congestion’. The move could bringing in as much as £100million-a-year for the airport.

The charge will be brought in from October and will apply to all vehicles - including taxis and private hire cars - entering the forecourt areas outside each terminal. Pictured: The charge will apply to drop-off areas outside the airport's terminals

The charge will be brought in from October and will apply to all vehicles – including taxis and private hire cars – entering the forecourt areas outside each terminal. Pictured: The charge will apply to drop-off areas outside the airport’s terminals

The double cost blow comes after a year and a half of disruption for travellers due to Covid. 

After initially banning international travel to stop the spread of variants, the Government introduced a confusing and often rapidly-changing travel traffic light system.

The system, which designated countries as red, amber and green, depending on the severity of their Covid outbreak, left many holidaymakers unsure about foreign travel.

It has since been simplified to a go and no-go list. Along with Covid measures, passengers have also faced disruption at Heathrow’s passport control area.

The immigration hall, run by Border Force, has been plagued by wait times. Issues with the e-gates, a lack of staff, and changes to the rotas of Border Force officials have been blamed. 

Meanwhile, a requirement for double-vaccinated travellers to take pricey PCR-tests on their return to the UK has also been dropped from the end of this month.

The policy change means that the PCR tests, which can cost more than £100, will finally be scrapped in time for families returning from half-term holidays.

The PCR tests will be replaced with cheaper rapid lateral flow swabs for travellers ‘before October 31’, although the free NHS tests will not be acceptable. 

Travellers will have to book the tests through private providers and prove on their passenger locator form, which must be filled out by all travellers before returning, that they have done so. Lateral flow tests typically cost between £20 and £40. 

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