Airlines say Auckland Airport should stop using them and passengers as a bank and instead start using shareholder dividends for its $1.8 billion building programme.

The Board of Airline Representatives said the airport was undertaking the biggest building programme in its history, yet shareholders were not being asked to make any contribution by forgoing dividends.

The Commerce Commission today has highlighted pricing for airlines and says it is concerned the airport is planning to make excessive profits on its regulated assets.

For the five-year period to June 30, 2022, the airport is targeting a return on its regulated asset base of 7.06 per cent against the commission's mid-point benchmark of 6.41 per cent.


"This difference in target returns could result in customers paying an additional 61 cents per flight over the next five years, or put another way - Auckland Airport earning an additional $47 million in profits after tax," said the commission's deputy chair, Sue Begg.

The board's executive director Justin Tighe-Umbers said the airport was maintaining its dividend policy to pay 100 per cent of underlying net profit after tax to shareholders while asking airlines and passengers to pay an extra $115m over the next five years.

''Our members should not be having to pay an extra $115m in fees, including $50m for a future runway they can't use for nearly 10 years. It's a question of what is fair. We believe the airport should be getting shareholders to contribute with their fair share as they are the ultimate beneficiaries of the investment.''

Tighe-Umbers said underlying profit after tax had increased 7.8 per cent to $133.1m for the past six months, which was paid out in dividends.

"That means just a portion of the airport's dividends would soon give AIA the $115m extra it wants airlines to bankroll over the next five years. The airport's pricing simply creates a straight wealth transfer from consumers to the airport, as it ultimately impacts on people buying air tickets," he said.

Auckland Airport's chief financial officer Phil Neutze said the company would review the draft report and then work with the commission on the detail of the report.

The airport continued to believe its prices for the five years were fair, given the approximately $2b investment the company was making in long-term infrastructure over that time.

Charges were only a small fraction of the overall cost of air travel, he said.


In real terms average charges would fall 1.7 per cent a year for international passengers during the five years and increase 0.8 per cent for domestic passengers.

The introduction of a runway land charge of $1.19 (excluding GST) a passenger from the start of the 2021 financial year has also been signalled, once construction of the second runway is confirmed, he said.

Tighe-Umbers said New Zealand's light-handed regulatory regime meant the Commerce Commission was unable to impose limits on what airports sought from airlines.

His organisation, which represents airlines operating in New Zealand, maintained that because airports were monopolies their charging regimes should be subject to more regulatory control.

"This behaviour is exactly why airport regulation needs to be tighter, and the Commerce Amendment Bill is a critical first step towards achieving that."