But you have not taken into account the UK Regulations that flowed from this. Here's what the CAA say
The Airports (Groundhandling) Regulations 1997 (GHRs)
The CAA has powers under the GHRs which implemented the European directive on access to the ground handling market at Community airports. The directive is intended to liberalise handling at EU airports.
The Airports (Groundhandling) Regulations 1997 (consolidated)
Airports with over 2 million passengers a year cannot limit the number of third party suppliers of ground handling services without permission from the CAA. The same applies at airports with more than 1 million passengers a year in relation to self-handling airport users.
Limitations may be granted, for example, on the grounds of safety, security, capacity or available space constraints at the airport concerned.
Airports can apply to the CAA for the number of third-party suppliers or self-handling airport users to be limited.
See here for the exemption guidelines
https://www.caa.co.uk/Commercial-ind...ulations-1997/
This was a very time consuming and expensive process that the airport looked at very carefully before deciding not to proceed to ask for exemption. In addition, at the time, the Airport were fully economically regulated by the same people (CAA Economic Regulation Group or some such) and the airlines were not in favour of any limitation; perhaps their view was coloured by the fact that the Airport had until not long before done most of the manual handling at least.
The airport was worried that it would become a free for all and so it has proved. The race to the bottom had begun.