Who owns Australia’s airports?

With regards to the investment in infrastructure, it is important to recognise that the vast majority of expenditure on airport infrastructure (essential for the transport of millions of Australian and international visitors), is privately-funded. This funding will amount to many billions of dollars over the coming decade and with this funding coming almost exclusively from the private sector, this provides a significant relief for the federal budget in these tough economic times.

To understand the impact of this investment, in 2012 the AAA commissioned Deloitte to investigate the economic and social contribution of Australia’s airports. The report noted that in 2011, the total direct economic contribution of airport operators was estimated at $3. 2 billion, with $2. 6 billion in gross operating surplus (GOS) and $620 million in wage payments.

The Deloitte report also noted that the operational core of an airport is only one component of its overall economic profile, with a broad range of associated and ancillary activities also occurring on airport precincts. With this taken into consideration, it was estimated that the broader economic contribution of Australia’s airports and their precincts was in the order of $17. 3 billion in 2011 (equating to around 1. 2 per cent of GDP), with overall employment at airport sites estimated to be around 115,200 FTEs.

With this significant private investment in mind, there is a common misconception from casual observers that much of this private funding comes through investment from large multi-national investment banks or overseas investors. The fact is that many ordinary Australians actually have a direct investment in Australia’s major privatised airports through their superannuation and pension fund holdings. The AAA has determined through recent consultation with its members that at as an industry average, our major privatised airports are actually 86 per cent owned by:

The estimated broader economic contribution of Australia’s airports was $17. 3 billion.

» Australian superannuation/pension funds directly;

»» managed funds invested on behalf of superannuation/pension funds;

»» self-managed superannuation funds; or

»» private family-based investment.

The remaining 14 per cent of the industry average minority shareholders are predominately managed funds and infrastructure investment firms based in Australia, with a small number overseas.

The AAA believes that this is an important message that needs to be more widely recognised. Airports are not only an essential contributor to the national economy, they also play an important role in providing secure investment opportunities for many Australian superannuation and pension funds. This secure investment in turn provides financial returns that ultimately benefit many millions of working Australians through their superannuation and pension fund holdings. The following is a list of just some of the Australian superannuation and pension funds that have investments in our major privatised airports.

»» AMP Superannuation

»» AustralianSuper

»» Colonial First State Super

»» Commonwealth Bank Group Super

»» Equipsuper

»» Australian Future Fund

»» IFM Investors

»» MTAA Superannuation Fund

»» Several public sector superannuation funds

»» Statewide Super

»» Sunsuper

»» Unisuper At a time where the federal government is looking for significant cost savings and reduced budget outlays, the Australian airport industry is an excellent example of how private investment can deliver important infrastructure without relying heavily on government funding support. Since the privatisation of this country’s major airports, it has been the superannuation and pension fund investments of ordinary Australians that have ultimately supported the growth of our aviation sector and contributed to the success of our tourism industry and the broader economy.

The growth and success of our airports into the future will support the future living standards and well-being of Australians in their post-working lives, as well as providing a secure investment opportunity for the superannuation of future generations.