Wednesday, 18 December 2013

A flight of fancy

As I mentioned last week, I said I'd start to have a look at the submissions various parties have made to the Productivity Commission on our regulatory institutions and practices.

Air New Zealand wants to escape from the ambit of the Commerce Commission and be primarily regulated by the Ministry of Transport, because the airline business is allegedly different to others ("international aviation is a unique market operating outside the normal influencers of a domestic economic or consumer environment") and the Ministry knows the scene best ("The Ministry is the national centre of expertise in international aviation and is the incumbent authority for alliance approvals").

On the other hand it wants precisely the opposite to happen to the airports. They should be taken out from under the shelter of the Airport Authorities Act ("permissive legislation designed for a time when airports (and indeed airlines) were state-owned and operated and therefore allows airports to ‘set prices as they see fit’") and policed more toughly by the Commerce Commission ("the light handed regulation of airports has failed and heavier handed regulation is required. Air NZ advocates the use of the negotiate / arbitrate provisions from the Commerce Act").

Good luck keeping both those balls in the air, lads!

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