Heathrow has been ordered by the Civil Aviation Authority to reduce airline passenger fees on an annual basis until 2026.
The regulator claimed that despite still allowing the airport to invest, the fee cut reflected the recent uptick in traveller numbers.
However, Heathrow, which wanted the fees increased, said that the action would jeopardise the implementation of crucial enhancements.
The costs are covered by the airlines, but they may be passed on to the travellers in the form of airfare.
The fees are used to maintain the terminals, runways, baggage handling, and security systems.
The average fee per person at Heathrow is currently £30.19, but according to the CAA, this will drop to £26.31 by 2026. Heathrow, though, wished to raise it to £41.95.
The charge decrease “reflect[s] projected increases in passenger numbers as the pandemic recovery continues and the higher level of the price cap in 2022, which was set in place in 2021 to reflect the challenges from the epidemic at the time,” the CAA claims.
Heathrow was given the go-ahead to raise the passenger fee for this summer from £19.60 to £30.19 in December 2021.
The charge reduction was “about doing the right thing for consumers,” according to CAA CEO Richard Moriarty.
According to John Holland-Kaye, CEO of Heathrow Airport, the regulator “continues to underestimate what it takes to provide a great passenger service, both in terms of the degree of investment and operational costs required and the fair incentive needed for private investors to finance it.”
He asserted that if the CAA’s proposal is not corrected, the lack of service investment will further worsen the customer experience at Heathrow.
According to Luis Gallego, chief executive of IAG, which owns British Airways, Heathrow airport fees will remain 56 percent higher than last year and three times higher than those in the EU.
A trade association called Airlines UK asserted that Heathrow was “the most expensive airport in the world” and that its rates were “still high.”
The International Air Transport Association (Iata) claimed that the increase in Heathrow costs set for December 2021 was “based on faulty assumptions that are already being proven wrong by the robust post-pandemic demand for travel.”