Ryanair welcome CAA price cap at Stansted

Ryanair today issued a cautious welcome to the decision by the UK CAA to adopt the passenger service charge price cap as recommended by the Competition Commission. Ryanair had high praise indeed for the CC whom it said had performed "Trojan work in reviewing the abusive practices of the BAA and disallowed huge amounts of wasteful expenditure." The proposed cost cap will run for five years. The cost per passenger in years one and two will be set at £6.34 and at £6.65 for the years 2013/014. It is hoped that the measure will encourage competition among the big three London airports. The CAA is also putting in place what it calls a "financial incentive scheme" ( or fine ) to ensure that Stansted Airport does not fail in it's obligation to provide good service to the travelling public. Under the terms of the scheme the Airport will be liable to rebate the airlines up to 7% of it's total passenger revenue should it fail to meet the required standard in areas such as security queuing, baggage reclaim, presentability of the airport and in services to the airlines such as available power and serviced stands. A similar scheme is currently in operation at both Heathrow and Gatwick and has seen the BAA pay rebates of £7.9m in the first seven months of this year. Whilst welcoming today's news, Ryanair reckons that the measures do not go far enough as only the breakup of BAA will introduce true competition into the market.