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FactCheck: Are Michael O'Leary and Ryanair right about Dublin Airport charges increasing?

The airline says the airport’s fees are rising. The airport disagrees. FactCheck steps in.

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Correction: 11.11pm

AT THE LAUNCH of its winter schedule recently, Ryanair linked its predicted fall in passenger numbers in Ireland this year with the Dublin Airport Authority’s ‘rising costs’.

And CEO Micheal O’Leary claimed the DAA were “refusing to extend” a scheme that rewards airlines for growing by giving them a rebate on charges.

A spokesperson for the DAA, meanwhile, told RTE News there had been no increase in their charges for 2017, and added “Our charges are flat”.

So who’s right here?

(Send your FactCheck requests to factcheck@thejournal.ie, tweet @TJ_FactCheck, or send us a DM).

Claim: The Dublin Airport Authority is increasing its charges

What was said:

In a press release to accompany the launch, Ryanair said it expected to have 14.4 million passengers into and out of Ireland in 2017, which is a drop of 3% from last year, and added:

…Ryanair passes on lower fuel costs, and an even better customer experience, and continues to grow strongly except in its home market where DAA costs are rising, while other EU airports are cutting prices.

And during the press conference, CEO Michael O’Leary elaborated:

…The DAA are refusing to extend their growth schemes. That means that, as the growth scheme ends at the end of every 12 months, the fees into the next year will rise.
The DAA will correctly say ‘We haven’t raised our fees’ – no, but by withdrawing the growth incentive schemes (or not extending them) the payments that we have to make rise, and rise significantly.

In response to FactCheck, a DAA spokesperson reiterated: “There has been no increase in charges in 2017. Our charges our flat”.

The Facts

Ryanair CEO Michael O'Leary. Source: Sam Boal/RollingNews.ie

We asked Ryanair to provide evidence to support their claims. In response, a spokesperson said:

Ryanair offered – in writing – to grow its Dublin passengers by 2 million per annum, on top of the 12 million passengers it will deliver at Dublin Airport this year, but the DAA rejected this offer as “not sufficient”.

Despite our request, we did not receive evidence of that specific correspondence. For its part, the DAA told FactCheck, “That is not the case”.

It should also be noted that this response by Ryanair does not represent evidence that DAA’s charges are increasing.

The airline also provided FactCheck a breakdown of the total amount it had paid DAA in charges over the past five years:

2013/2014: €66.8 million
2014/2015: €77.5 million
2015/2016: €86.8 million
2016/2017: €101.9 million
2017/2018: €115 million

That Ryanair’s annual payments to the DAA have been increasing is not evidence that the DAA’s charges have been increasing.

What an individual airline ends up paying can depend on various factors, most notably if their passenger numbers have been increasing.

Since the DAA’s passenger charges are levied per passenger, an increase in passengers is likely to equate to an increase in charges paid, but the basic charge per passenger does not have to increase in order for this to be the case.

And it’s also possible for an airline to pay more one year than the previous year, despite the absence of an increase in the DAA’s charges. For example, Ryanair will pay more in 2017/2018 than in 2016/2017, despite an expected decline in passenger numbers.

How the DAA’s airline charges work

First, the Commission for Aviation Regulation imposes a “price cap” on the DAA – a maximum amount per passenger that the airport is allowed to charge airlines each year.

In 2015 it was €10.26, in 2016 it was €10.31, and in 2017 it has fallen to €9.86, according to the Regulator.

Then, the airport puts together a menu of different charges for airlines, relating to runway usage, aircraft parking, as well as passenger fees, and so on.

The Aviation Regulator provided us with those charges for 2016 and 2017. You can compare and contrast for yourself:

Source: For a full-size version of this image, click here via Dublin Airport Authority

As you can see, almost all 18 charges are exactly the same this year as they were in 2016.

One fee, the PRM charge for “persons with reduced mobility” has increased from 35 cents per passenger to 44 cents per passenger.

A DAA spokesperson told FactCheck:

DAA passes on the costs of the third party company which provides the PRM service to airlines. It makes no revenue from the charge.

And where in 2016 the DAA charged separate rates per passenger for departures from Terminals 1 and 2, from 27 March onwards this year, those rates are consolidated.

This will ultimately equate to a reduction in the passenger charge for departures from Terminal 2.

Growth Incentive Scheme

Aeroplanes at Dublin Airport Source: Sasko Lazarov/RollingNews.ie

Dublin Airport offers airlines a rebate on those charges, in the event that overall passenger numbers into and out of Dublin Airport increase over the course of the year.

So, if overall traffic in 2017 ends up being greater than it was in 2016, and an individual airline’s traffic also grows, that airline qualifies for a rebate on charges, calculated based on the percentage of the overall growth that it contributed to.

That rebate is then paid retrospectively, later on.

The details of the 2017-2019 Growth Incentive Scheme are available here. The details of the previous scheme are available here.

Despite Michael O’Leary’s claim that “the DAA are refusing to extend their growth schemes”, there has been no change to DAA’s growth incentive scheme between this year and last year.

Conclusion

Ryanair claimed that the DAA’s charges were rising.

The airline did not provide evidence to support that claim, but rather figures showing their annual payments had been increasing, which is not the same thing.

And evidence provided by the independent Aviation Regulator shows that the airport’s basic charges were, on the whole, flat between this year and last year.

Ryanair CEO Michael O’Leary later claimed that the DAA were “refusing to extend their growth schemes”.

The airline told FactCheck it had offered in writing to grow its business by two million passengers in two years, but the DAA rejected that offer.

Despite our request, we did not receive evidence of that specific correspondence, and the DAA said “That’s not the case”.

Furthermore, there has been no change to the terms of the DAA’s new Growth Incentive Scheme (2017-2019) compared to the scheme that was in place last year.

We rate Ryanair and Michael O’Leary’s claims FALSE. As described in our Verdicts Guide, this means: “The claim is inaccurate”.

This is the first time we’ve fact-checked claims by Ryanair and Michael O’Leary. In future, you’ll be able to find their FactCheck Files here and here, respectively.

Correction: This article previously stated that “Since the DAA’s passenger charges are levied per passenger, an increase in passengers will inevitably equate to an increase in charges paid”.

An increase in charges paid is not, in fact, an inevitable consequence of an increase in passengers, but rather a likely one. The article has been amended to reflect this.

TheJournal.ie’s FactCheck is a signatory to the International Fact-Checking Network’s Code of Principles. You can read it here.

For information on how FactCheck works, what the verdicts mean, and how you can take part, check out our Reader’s Guide here.

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About the author:

Dan MacGuill

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