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There are ongoing calls for a rail link to be built to Melbourne Airport. Earlier this month, Prime Minister Malcolm Turnbull threw his support behind the proposal and confirmed that funding would be included in the May Budget:
“The Napthine government took steps towards a rail line to Tullamarine and it’s always been something that’s been seen as an omission in Melbourne not to have a rail line out to the airport”.
However, Victoria’s Public Transport Minister, Jacinta Allan, hosed the proposal, calling on the federal government to instead fund rail projects that are ready to go:
Ms Allan said the problem with going ahead with the airport link was that the Metro Rail project needed to be finished first.
“We already have a public transport system that has significant challenges because there’s not the space to run extra trains,” she said.
“The Metro tunnel unlocks that capacity and that’s why we’re working very hard to deliver that right now.”
Over the weekend, it was reported in Fairfax that Melbourne Airport’s private operators are likely to impose significant rental charges on any railway station that is built on their land. The rent imposed by Sydney Airport is such that it costs $7.96 just to travel 90 seconds from the last station outside of its control to the station at its domestic terminal, and there is nothing to stop the owners of Melbourne Airport, which include the Future Fund, from imposing similarly high rents:
How does Sydney Airport get away with this legalised larceny? Quite simply it seems. As a lessee it’s allowed to charge whatever it likes for having a station built on its premises.
…a year ago The Sydney Morning Herald reported that around 80 per cent of the peak hour train ticket charge from the city ended up in Sydney Airport’s bank account.
The lesson is clear. Melbourne airport’s operators will seek to extract the same high rental for the sought after link, meaning the cost of travelling to the airport by rail will be far higher than anyone expects. Why? Because they can. Nothing in the Howard government era lease agreement will prevent a similarly usurious rental being demanded by Melbourne Airport’s operators.
…a higher rental fee will discourage passenger use, the very thing its forthcoming announcement hopes to one day achieve.
Last month, the ACCC released its annual Airport Monitoring Report, which revealed that Australian major airports have over the past decade collected $1.57 billion more in revenue from airlines and passengers than they would have if average prices charged for access to airports had held constant in real terms. The ACCC report also claimed that Australia’s airports have become less efficient.
Australia’s airports represent a textbook example of Australia’s privatisation failures. Instead of driving greater efficiencies and lower costs for consumers, we have experienced the opposite. Instead, the private airport owners have used their market power to lazily force-up user costs and boost their profits. And now they risk sabotaging a Melbourne Airport rail link via extortionate rental charges, thus lessening the chance that the line will ever be built or greatly lessening its take-up (in the event that it is built).
This article first appeared on www.macrobusiness.com.au
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