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do you think that continued Commonwealth ownership and operation would have produced a better result?

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....so, do you think that continued Commonwealth ownership and operation would have produced a better result?

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Australians fly. A lot. Our island nation and our sheer geographical size mean air travel is part and parcel of our connectedness here and across the globe. And so, in this respect, our airports are our lifeblood.

We have fly in, fly out workers. We have flying doctors and emergency services, a burgeoning airfreight sector, as well as myriad charter operators in the tourism sector.

More than three million passenger journeys occur between more than 180 airports in Australia every week. We welcome 642,000 overseas visitors and farewell about 737,500 Australians on outbound trips on 58 international airlines each month.

In 1996, when the federal government still operated our major airports, it managed the movement of 67 million passengers a year.

Today, under the private ownership model, this number has grown to more than 154 million passengers.

In addition to tourism and international education being among our biggest export industries, our airports handle more than $100 billion of freighted exports and imports every year — such as gold, computers, food, flowers, industrial components and mail.

Each one of these journeys begins and ends at our airports.

In large part, Australia’s efficient connectedness by air is what it is today because of ongoing investment in our airports by their private sector owners and operators.

This month marks 20 years since the first three of those transitions took place at Brisbane, Melbourne and Perth airports. Many more followed in 1998. Since then air travel and the development of our airport economies in Australia have not looked back.

In its most recent regulatory report the Australian Competition & Consumer Commission indicated the operators of the biggest four airports in Australia invested $7bn across a 10-year period.

That investment has helped attract new carriers and open new routes and destinations for Australian passengers and competition that keeps downward pressure on airfares.

It has funded upgrades to infrastructure so airlines from around the world can land and transport Australian passengers on Airbus A380s.

It has cultivated commercial and retail business to the point where 100,000 Australians are now employed within airport precincts across the country.

It has delivered better security and facilities to ensure passengers begin and end their journeys safely.

It has helped to preserve regional air travel, with major airports and small council airports investing to support regional services across the country.

Through investment, airport operators also have developed the terminals that have underpinned the establishment and growth of low-cost carriers, Virgin and Jetstar among them.

Ongoing investments such as these are one of the reasons carriers such as Virgin and Jetstar have been able to keep airfares low.

Advances such as the self-serve technology being rolled out by airports are not only streamlining the check-in process for passengers but also are helping airlines to reduce their costs.

In fact, all of the investment by major airports in aeronautical infrastructure is designed to facilitate operational efficiencies for airlines and minimise their capacity constraints.

Improvements to runways, taxiways and aircraft parking foster growth, sustainability and a safe and competitive aviation market. And these investments have continued despite the return on aviation assets falling during the past five years. These are long-term investments funded primarily by Australian families through their superannuation.

This is in stark contrast to major public infrastructure throughout Australia — take ports, roads and urban public transport, for example — many of which bear the scars of systemic financial neglect and a failure to future-proof.

The taxpayer has not had to prop up our major airports for 20 years in the way the public purse has been relied on in every other infrastructure sector.

That is thanks to the decision made those two decades ago to open the doors to private investment and let innovation and enterprise thrive.

Investment by airport operators has not only proven vital to the customer experience.

It has provided the dynamic operational environment airlines require and has cultivated economic opportunity for the countless businesses and other services now run from, or as part of, airports across the country.

Caroline Wilkie is the chief executive of the Australian Airports Association

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Stop bashing us, 'bruised' Melbourne Airport tells airlines
Patrick Hatch

The boss of Melbourne Airport has hit back at claims that Australia's monopoly airports are gouging airlines and that privatisation has been a failure.

Instead, Lyell Strambi says airports should get more credit for helping boost carriers' profits.

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"I feel a little bruised that we're not getting full credit for the great work that we actually do," says Melbourne Airport chief Lyell Strambi.

Airlines have been on a war path over what they say are skyrocketing fees to land and take off at airports, and earlier this year Qantas, Virgin Australia, Air New Zealand and Regional Express formed the group Airlines for Australia and New Zealand to lobby for relief.

The Australian Competition and Consumer Commission's annual report into airports this year found airports had steadily increased how much they charged airlines and boosted their profit margins over the past 10 years, taking in $1.57 billion more in revenue than if they kept the fees steady in real terms.

And the privatisation of Australia's airports has recently come under global criticism.

But Mr Strambi, Melbourne Airport's CEO, said airlines and airports' interests were aligned, and that airports had made significant investments to help carriers improve their profits.

He pointed to his airport building facilities to accommodate the double-decker Airbus A380 flown by Qantas and other airlines, and the building of the new T4 low-cost carrier terminal as examples where the airport's investment had improved airlines' efficiency.


"You need to look past the headline to actually say, yes, prices may well have increased beyond CPI from an airport charges perspective, but when you look at airfares and the resulting cost to the customer, they've continued to come down," Mr Strambi said.

Melbourne Airport's boss has hit back at claims of gouging.

"I feel a little bruised that we're not getting full credit for the great work that we actually do."
Try landing in LA

Alexandre de Juniac, chief executive of commercial aviation's global body the International Air Travel Association, named and shamed Australia last month as a country where privatising airports had been a failure, resulting in higher fees for airlines to the detriment of passengers and local economies.

But Mr Strambi, whose airport marked 20 years of private ownership this week, said anyone critical of privatisation should visit a government-owned airport such as Los Angeles International.

"That was a government facility and it actually looked and felt like a government facility: under investment, no real passenger amenity," he said.

"It's been really interesting, they haven't privatised the airport but they have introduced a private partner in Westfield into that airport and that has fundamentally changed the passenger experience."
'Liberation of capital'

Mr Strambi said privatising Australia's airports had resulted in a "liberation of capital from the public purse", and that private owners - a group of investors, mostly superannuation funds, in Melbourne's case - had greater discipline and accountability than governments would have.

Sydney Airport had the highest profit margin for aeronautical services last year at 46.7 per cent, followed by Brisbane Airport (44.9 per cent), Melbourne (38.2 per cent) and Perth (33.5 per cent), according to the ACCC.

Melbourne Airport estimates passenger numbers will double to 70 million a year over the next two decades and that it will overtake Sydney Airport as the nation's busiest.

It hopes to have a third runway operational by 2022 to deal with that growth.

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