Competition could bring new wave of expansions

The prospect of a second runway at Gatwick and further expansion at Heathrow and Stansted is raised in today's Competition Commission report.

Although the findings do not contain concrete recommendations on new runways, they state that BAA's control of the three London airports means that pressure for expansion in the past has been focused too much on Heathrow.

It suggests that this would change if new owners took control of Gatwick and Stansted and that "vigorous" competition between rival operators would be likely to lead to more rapid expansion of capacity in the South-East.

The report also criticises BAA for failing to seek to overturn a legal agreement which prevents a new runway being built at Gatwick before 2019 and says the Government's 2003 Air Transport White Paper - which ruled this option out - should now be reviewed.

It adds that the refusal of ministers and BAA to consider expansion at Gatwick has reduced competition.

The report states: "Separate owners would face strong incentives to expand capacity and win traffic from rival airports.

"We would therefore expect separate owners to display a greater appetite for runway capacity expansion than BAA has and to lobby Government accordingly for the necessary policy framework to support such development, rather than lobby against them as BAA appears to have done."

In addition, today's report says that boosting capacity through measures such as more use of off-peak slots and larger planes could allow an extra 20 million passengers to use Heathrow and an extra four million at Gatwick.