Origin holds back over Wellington fee increase

By CHRIS DANIELS aviation writer

Origin Pacific, the number three domestic airline after Air New Zealand and Qantas, says it is still deciding whether to start paying new charges at Wellington Airport.

The airport company raised its charges by 78 per cent in February, saying it was entitled to earn a fair rate of return on its investment in a new terminal.

Air New Zealand is collecting the new charges from its customers, but refuses to pass them on to the airport. Qantas is paying the airport fees, but does not levy its customers.

Origin Pacific chief executive Tony Marks said the airline would decide before the end of the month how to react.

"We're still in the process of forming a view.

"Like the other airlines, the charges strike us as extremely significant and represent a huge impost on a relatively small company like ours, which generates a significant amount of its traffic through Wellington."

Marks said Origin Pacific would have to look carefully at the pricing regime and at the number of people it took through Wellington.

The airport served as a hub for Origin Pacific.

Air New Zealand has gone to the High Court, challenging the legality of the increase, saying the airport did not follow proper procedure.

It says that if a court decision on the charges means it has collected too much money from its passengers, it will not refund the money, but instead make a contribution to promoting Wellington tourism.

Air New Zealand is not only increasing fares to passengers using Wellington Airport, but also for some who fly over it.

For instance, a direct flight from Auckland to Nelson will incur the charge because there is an alternative route that flies Auckland-Wellington-Nelson.

Air NZ says it uses this method of charging to "avoid fare complexity".

The airport is 66 per cent owned by listed investment company Infratil and 34 per cent by the Wellington City Council.

The airport company has filed proceedings in the High Court to force Air New Zealand into paying up a disputed sum of $7,057,000.

Air New Zealand has asked the Government to impose a price control on the airport, saying it has abused its monopoly position.