Making It Pay
Airport cities are part of the growing importance of non-aeronautical revenue.
From a 70–30 split not so long ago, the latest Airports Council International (ACI) figures show airport income is now made up of 54% aeronautical revenue and 46% non-aeronautical. But not all airports agree that airlines should benefit from non-aeronautical revenue. Many airport authorities, such as BAA, still use a single till but others are moving toward dual-till accounting. It has been reported that Paris Charles de Gaulle and Brussels are considering dual till as well as airports in Argentina.
Under single till, non-aeronautical revenue subsidizes aeronautical charges. Under dual till, aeronautical charges alone are considered to cover the cost of aeronautical services. A hybrid till, as the name suggests, is a halfway house where a proportion of non-aeronautical revenue plays a part.
IATA stands firmly behind the single till concept, seeing it as an acknowledgement of the essential relationship between airline and airport. “Airlines bring passengers to the airport and as the primary users should share the benefits from non-core activities,” says Hemant Mistry, IATA Director for Industry Charges, Fuel and Taxation. “The application of a single till is a clear recognition of this fact.”
The original International Civil Aviation Organisation (ICAO) Document 9082, published in 1974, clearly supported the single till. As airport privatization took hold and the need for financial self-sufficiency increased, ICAO changed the wording slightly to leave some room for manoeuvre. The wording was changed again in 2011 at the 4th Airport Economics Panel and Air Navigation Services Economic Panel to clarify ICAO’s neutral position. But the key pillars for airport charges of non-discrimination, cost-relatedness, transparency and consultation still hold true.