The UK Civil Aviation Authority has today issued its decision on an interim price cap on what Heathrow Airport Limited can charge its airline customers for 2023. We consulted on these proposals in December 2022 and received detailed submissions from Heathrow Airport and the airline community, which we have reviewed and carefully considered before making our decision.
Our decision sets the interim price cap at £31.57* per passenger (in nominal prices). This value is in line with our H7 Final Proposals (FPs) issued in June 2022. As with our interim price cap for 2022, once we have set the final price control for the H7 period, any difference between it and this interim price cap for 2023 will be automatically adjusted up or down
This interim price cap replaces the current cap that applies to Heathrow Airport’s charges in 2022, which expired on 1 January this year. It is required to protect the interests of consumers in the short term as our final decision and licence modifications for a five-year price control (H7) will not be published until March 2023.
Paul Smith, Consumer and Markets Director said: “We are implementing these licence modifications to protect consumers and to give certainty to the airport and airlines on the level of the price cap for 2023.”
Alongside our decision on the implementation and level of the interim holding cap, we also confirm our decision to make a small number of specific changes to HAL’s licence to remove obligations under the service quality framework that we consider are no longer needed.
These licence modifications will take effect six weeks from today.
Link to interim price cap: www.caa.co.uk/CAP2515
Notes to Editor
Developments in the wider economy since we published Final Proposals in June 2022 have given rise to a degree of volatility in forecasts of inflation and interest rates.
As a result, it was in the interests of consumers, to take further time and conduct additional analysis before reaching our final decision on the H7 price control which is now due to be announced in March 2023.
* Which is equivalent to £29.68 in 2020 prices.