Wednesday, January 11, 2017

The Contradiction Of Airport Policy

Palma's Son Sant Joan airport topped 26 million passengers last year. It was a record. Roughly another million may be added this year. Another record. And when the figures are released month by month this year, which they are in laborious detail showing percentage rises for this, that and another thing, the mongers of saturation doom will assure us that the island has reached and passed the point of touristic redemption. If only the numbers arriving at the airport could be limited, they will wail, while wiping away the tears of non-sustainability.

Something curious happened on Monday. One says curious, but it wasn't so curious to hear a Balearic minister calling for a cut in airport charges. This demand has been made before. A justification of bringing about an increase in Balearic competitiveness also wasn't curious. Lower costs (in theory) for the travelling public and freight, and competitiveness is gained. But it does rather depend on which part of the public is doing the travelling and what the freight is for.

What was curious was when the minister, Marc Pons (transport), referred to boosting Balearic competitiveness as a tourist destination and to promoting additional traffic. Did we hear this right? He wishes the records to keep on being broken and thus intensify the cries of the saturation mongers?

Pons may of course had in mind the promotion of more traffic for the off-season. But if he did, then he is still firmly in saturation territory. There may be (are) certain members of the Balearic government, its president for example, who have come up with the ludicrous notion that summer visitors can somehow be shifted to the winter, but that is not about to happen. More visitors in winter mean more visitors, period. In any event, he was also calling for an increase in the off-season tariff discount from 20 to 25%.

Although one struggles to appreciate how much difference a 2.6% reduction in charges over the next five years, which is what he was calling for, would really make, he clearly believes that it would make a difference: greater competitiveness and more people. He has an ally in this regard in the form of the National Competition Commission. It has been demanding that Aena drop its charges by two per cent and it has been at loggerheads with Aena for a while. Basically, the commission thinks the airport authority overcharges, while there is also the issue of accounting for airport operations, with Aena being required to fully adopt a dual-till system by 2018.

What Pons was really driving at was the fact that Palma and the other two Balearic airports each year generate more than 1,150 million euros of airport taxes that go to Aena and which have no benefit for the Balearics. His 2.6% reduction would save the travelling public roughly 30 million euros a year; this public being both resident and tourist. But while he couched all this in terms of greater competitiveness and more employment, the bottom line - once more - is the desire for airport co-management, something that has always been remote and becomes ever more remote if the national government decreases its shareholding in Aena, which it has suggested that it will do. The consequence of this would be that the state would no longer be the majority shareholder, albeit that it would retain a significant holding (probably 40%).

But where this becomes ever more curious is in the apparent contradiction with what has been said in respect of the so-called tourism saturation. Biel Barceló is not alone in having explained that because the regional government does not co-manage the airports, it cannot adjust the number of tourists arriving. The implication is that were there to be co-management, then the government would seek to reduce flights.

Whether it would be able to is a wholly different issue. The national government and Europe would have its say, and the competition commission certainly wouldn't look upon it favourably. Even if there were to be a policy of reduction, courtesy of co-management, it would only take a change of regional government for the policy to be reversed. The Partido Popular, which has been as much in favour of co-management as the left (Jaume Matas believed he was getting somewhere on this with the Zapatero administration back in 2005), would doubtless free things up again. Apart from anything else, this would all cause great uncertainty for scheduling.

Fundamentally though, how would such a policy square with the Pons advocacy of greater competitiveness and greater traffic through a reduction in airport taxes? On the one hand there is talk of limiting arrivals; on the other there is talk of their increasing. It's baffling. Securing a better deal for passengers is an admirable aim, and the additional tourists would no doubt be grateful. Curious.

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