Gatwick Flow Rate?
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Yes, it’s a competitive environment, but we do know exactly when, how and why it went wrong. And even NERL has to justify it costs, so when at Reporting Period 3 it was asked to enact performance improvements, a very normal business practice, and replied that ‘it was not in the country’s or the business’s (sic) interests to do that’, we saw exactly the non-competitive, market-rigging stranglehold NATS has on the ‘market’ for what it is. (Apologies, but not really, if the truth hurts).
The amount that NATS is allowed to charge for its en-route services, ie the Eurocontrol unit charge, is set every 5 years. The CAA sets the rate, the customers (airlines) and NATS and others submit their contributions to that process and the CAA produces a draft recommendation. NATS can accept that recommendation or appeal. If it wishes it can apply to the Competitions and Marketing Authority for a review, that is the arbitration body laid down in the process.
It would come as no surprise to anybody that the customers, one in particular, and NATS have opposing views as to what the price should be. NATS is entitled to fight its corner during that process and, having accepted well below the rate of inflation price increases in the previous periods, decided to do so for RP3. It was up to the CAA and ultimately the CMA to decide if they had a valid point. It is a monopoly which is why it is regulated. That doesn't mean NATS can't make its point forcefully if it chooses to do so. Ultimately a pandemic threw the market up in the air so we will never know who was right. And if you want a company to have a long term investment you have to give it a long enough licence period to allow it to fund that investment. You could call it a stranglehold but it's an inevitable outcome if you want to remove investment from the public purse.
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We've had this discussion before on a different thread and it is in no way relevant to whatever is happening at Gatwick but for the benefit of those who didn't plough through that thread.
The amount that NATS is allowed to charge for its en-route services, ie the Eurocontrol unit charge, is set every 5 years. The CAA sets the rate, the customers (airlines) and NATS and others submit their contributions to that process and the CAA produces a draft recommendation. NATS can accept that recommendation or appeal. If it wishes it can apply to the Competitions and Marketing Authority for a review, that is the arbitration body laid down in the process.
It would come as no surprise to anybody that the customers, one in particular, and NATS have opposing views as to what the price should be. NATS is entitled to fight its corner during that process and, having accepted well below the rate of inflation price increases in the previous periods, decided to do so for RP3. It was up to the CAA and ultimately the CMA to decide if they had a valid point. It is a monopoly which is why it is regulated. That doesn't mean NATS can't make its point forcefully if it chooses to do so. Ultimately a pandemic threw the market up in the air so we will never know who was right. And if you want a company to have a long term investment you have to give it a long enough licence period to allow it to fund that investment. You could call it a stranglehold but it's an inevitable outcome if you want to remove investment from the public purse.
The amount that NATS is allowed to charge for its en-route services, ie the Eurocontrol unit charge, is set every 5 years. The CAA sets the rate, the customers (airlines) and NATS and others submit their contributions to that process and the CAA produces a draft recommendation. NATS can accept that recommendation or appeal. If it wishes it can apply to the Competitions and Marketing Authority for a review, that is the arbitration body laid down in the process.
It would come as no surprise to anybody that the customers, one in particular, and NATS have opposing views as to what the price should be. NATS is entitled to fight its corner during that process and, having accepted well below the rate of inflation price increases in the previous periods, decided to do so for RP3. It was up to the CAA and ultimately the CMA to decide if they had a valid point. It is a monopoly which is why it is regulated. That doesn't mean NATS can't make its point forcefully if it chooses to do so. Ultimately a pandemic threw the market up in the air so we will never know who was right. And if you want a company to have a long term investment you have to give it a long enough licence period to allow it to fund that investment. You could call it a stranglehold but it's an inevitable outcome if you want to remove investment from the public purse.
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The investment should still offer value for money, otherwise you’re simply gouging passengers who are ultimately your only source of revenue - yes, we did discuss it in a previous thread, and I pointed out £100m projects where 90% of activities were unnecessary, so despite your weasel/corporate PR words, yet again, your arguments try to deny the facts!
If NATS fails to deliver the improvement promised in its investment plan it will ultimately suffer because those expected improvements will guide the expected price next time around.
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I wouldn't disagree with the objective. You may consider that it currently doesn't but capital expenditure is all part of the pricing process. The Investment Plan is submitted as part of the process, independently reviewed by an organisation of the CAA's choosing, subject to comment by all stakeholders and them forms part of the licence conditions for that charging period. Whether that process works to deliver value for money is a matter for others not NATS.
If NATS fails to deliver the improvement promised in its investment plan it will ultimately suffer because those expected improvements will guide the expected price next time around.
If NATS fails to deliver the improvement promised in its investment plan it will ultimately suffer because those expected improvements will guide the expected price next time around.
The 90%/£90m cost was because one (NATS, senior) person's bonus depended on spending that much - so he was hardly likely to expose, any more than you are, that it was a complete waste of money!
So this was ENTIRELY NATS fault, nobody else's. And there is no evidence that NATS 'suffered' any consequences whatsoever. We know what happened to the 'expected price next time round' - NATS refused to improve on it!
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Ever time, you deflect responsibility from NATS, are they entirely unaccountable?
The 90%/£90m cost was because one (NATS, senior) person's bonus depended on spending that much - so he was hardly likely to expose, any more than you are, that it was a complete waste of money!
So this was ENTIRELY NATS fault, nobody else's. And there is no evidence that NATS 'suffered' any consequences whatsoever. We know what happened to the 'expected price next time round' - NATS refused to improve on it!
The 90%/£90m cost was because one (NATS, senior) person's bonus depended on spending that much - so he was hardly likely to expose, any more than you are, that it was a complete waste of money!
So this was ENTIRELY NATS fault, nobody else's. And there is no evidence that NATS 'suffered' any consequences whatsoever. We know what happened to the 'expected price next time round' - NATS refused to improve on it!
The problems started with the initial change from Nats to ANS.
I can't recall the exact numbers but about 7 Atcos (20%) took the option of staying with Nats - - GAL knew this was a possible outcome but took the risk anyway.
GAL took a risk on a new atc provider knowing atco levels could plummet to extremely difficult levels.
It has backfired spectacularly. They have tried to rectify this by bringing Nats back but the problem is far bigger than any of them wish to admit.
I can't recall the exact numbers but about 7 Atcos (20%) took the option of staying with Nats - - GAL knew this was a possible outcome but took the risk anyway.
GAL took a risk on a new atc provider knowing atco levels could plummet to extremely difficult levels.
It has backfired spectacularly. They have tried to rectify this by bringing Nats back but the problem is far bigger than any of them wish to admit.
At Boscombe Down in 1992 for instance, the company which 'won' the contract knew they had only previously provided APP and had little experience of APS provision and then only about 2 of the incumbents elected to transfer from NATS and they were due to retire within a few years anyway. This meant the 'new' provider had to try to get APS rated controllers in to train up and were unable to get enough suitably rated controllers with the required experience hence in this particular case as the operations were already military orientated albeit using civilian staff the RAF were asked to take over the contract.
In another case I heard of, the 'new' provider decided that he could provide the service with fewer controllers and when the contract commenced, the new provider fired all the controllers then offered contracts to a few of the remaining ones.
