Editorial: Passengers should pay

Last updated 10:36 16/10/2012

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The Marlborough Chamber of Commerce suggestion to fund expansion work on the Blenheim airport passenger terminal through a departure tax is predictable, and sound.

Marlborough Airport Ltd, a subsidiary of the district council, has confirmed it is looking at options for extending the terminal building, which has become too small. Plans include doubling the ground floor area, creating a meeting room and lounge for up to 20 people and making space for Air New Zealand to provide a Koru Club.

Airlines operating from the terminal and other tenants should expect to pay a higher rental for use of the bigger space, but they should not have to fund the whole project.

Neither should the work be funded from general rates, which are for essential services. Rather, a major proportion of the costs should come from the biggest users - the travelling public.

Chamber of Commerce general manager Brian Dawson suggests a $5 departure tax or development levy paid by all passengers boarding a flight from the terminal.

According to the latest figures, 230,000 passengers go through the terminal a year. Assuming half of them are flying out and would have to pay the tax, this would bring in about $575,000 a year. Less the cost of collection, it would give the company about half a million dollars a year to fund development, which should be sufficient.

A similar proposal is being debated in Taranaki, where a $3m terminal expansion is planned at New Plymouth airport.

Other centres are taking another approach. Both Queenstown and Palmerston North airports are dropping their departure tax and increasing landing fees, so the user airlines pay slightly more per flight.

This is a compromise that still makes the passenger pay but without having to fiddle around finding $5 cash when they are about to board a plane. The airlines simply increase their fares, as Air New Zealand has done by $3 a seat in Palmerston North.

The airport company needs to be confident, though, that the airlines will pay the increase and not reduce the number of flights or use smaller planes. Whatever the outcome of the discussions, Mr Dawson is right that the traveller should pay for the expansion.

Another point to be made is that the levy must be dropped as soon as the expansion is paid for. The public will tolerate a tax when they see a benefit, but not as a lingering revenue-gathering mechanism.

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- The Marlborough Express


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