New approaches to the determination of runway use tariffs in South Africa arising from the new ICAO PCR/ACR standard adopted in November 2024

Abstract

The International Civil Aviation Organisation (ICAO) has always advocated a ‘user pay’ approach to the airport tariffs, which member-nations and their regulatory authorities are mandated to adopt. In SA, ‘user pay’ is also a central tenet of public sector policy, especially in the areas of non-basic municipal services. Aeronautical revenues are dominated by landing and passenger service charges, which are usually charged per landing or per departing passenger. Landing fees vary according to the weight of the aircraft, and passenger fees depend on the destination i.e. domestic, regional or international. ACSA, which was formed in 1993, accounts for over 90% of SA’s scheduled passengers, plus most landings, mainly in large aircraft. ACSA’s tariffs are subject to strict regulation by the Civil Aviation Regulator, through annual ‘permissions’ on a rolling 3-year cycle. While all ACSA airports are bound by these tariffs, the practice at many non-ACSA airports is also benchmark tariffs against ACSA’s. This tactic tends to reflect a perception that tariffs higher than ACSA’s may suppress demand at such airports, which may not be true. Besides 9 ACSA airports, there are over 500 others of various categories on the latest SACAA database, 38 of which are commercially licensed. Municipal airports fall in this category. However, most of these airports are unsustainable and operate under business models materially differ from ACSA’s, at much lower scale. Whereas the ACSA airports can handle up to 10 mil passenger departures and over 100 000 landings per year, their municipal peers can barely muster 50 000 pax and fewer than 10 000 landings. The aeronautical revenue of municipal airports is far too small to cover even direct costs, with resulting accelerated dilapidation and ongoing non-compliances with SACAA standards. A worrying recent trend has been the ad hoc deployment of aircraft gauges unsuitable for the load capacity of runways at many airports, with the consequent alarming degradation of pavements. This situation is compounded by a lack of technical evaluation of pavements and uncertainly by airport owners of their pavement capacity. The USA FAA and ICAO have been aware of the issue for many years, but only in November 2024 did ICAO mandate a new method for the ongoing evaluation of runway pavements, based on a model developed by the US FAA, which allows a rigorous analysis of pavement performance. A key change is the way of classifying aircraft from the ‘old’ ACN (aircraft classification number) to the ‘new’ ACR (aircraft classification rating). For pavements, ‘PCN’ is replaced by ‘PCR’, which takes greater account of factors like undercarriage configuration, tyre pressures and pavement materials. The model thus enables an accurate determination of how ‘pavement aggressive’ different aircraft types are and how varying aircraft mixes and traffic patterns can affect pavement life. This paper examines options that small airport owners might have to re-imagine their landing fee tariff structures to better account for the types and volumes of aircraft planning to use their infrastructure, so that the ‘user pay’ principle is restored. A similar argument will apply to the re-assessment of passenger service charges, especially at airports where a high proportion of general aviation (GA) business does not require investment in terminal infrastructure or high category fire and rescue capability, which is expensive to operate. Increasing reversion to ‘user pay’ models is likely in the face of ongoing pressures to right-size municipal and other small airports.