Sydney Airport has called for a major overhaul to the controversial slot system, calling it unfit for purpose and saying airlines should have much less leeway for cancellations.
In a submission to the House of Representatives Standing Committee on Economics’ inquiry into promoting economic dynamism, competition and business formation, the airport urged the Government to lift the current 80-20 “use it or lose it” rule to 95-5.
Under the 80-20 rule, an airline is able to keep a takeoff slot indefinitely as long as it uses it at least 80 per cent of the time. Sydney Airport’s proposed changes would see the rules changed so an airline must use the slot at least 95 per cent of the time in order to keep it.
The airport noted that this is around two and a half times the current long-term cancellation rate at Sydney of 2.1 per cent, and that airlines already receive slot usage dispensations due to weather.
“A threshold of five per cent for cancellations would give airlines ample buffer for legitimate operational impacts and if cancellation rates are above this, airlines should be asked to justify why,” the submission read.
In the cover letter for the submission, Sydney Airport CEO Geoff Culbert – who has repeatedly blamed alleged slot hoarding for the airport’s sluggish domestic recovery – said Sydney Airport has been advocating for reform since 2017.
“Slots at Sydney Airport are managed by a regulatory framework put in place in 1997, which constrains productivity and efficiency at one of Australia’s most important infrastructure assets and is no longer fit for purpose,” he wrote.
“Not only do the regulations unintentionally prevent the airport from reaching its legislated maximum capacity of 80 movements per hour, but the absence of a framework that prevents slot misuse has allowed incumbent airlines to accumulate more slots than they need at Sydney Airport.”
The slot rules are necessary because two aircraft cannot simultaneously take off on the same runway, but have led to accusations that major carriers are effectively gaming the system to take advantage, though both Qantas and Virgin have vehemently denied any wrongdoing.