Travel: A sneaky way of charging more

Substitute air travel for beans, and you'll see why fares will rise by up to 15 per cent
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The Independent Culture
CONSIDER A can of baked beans (or, if you are a business-class sort of person, asparagus spears). It would surely be absurd for the manufacturer to say, "Until now, we've included the cost of the container in our prices, but from next week we are going to charge you extra for it." Yet that precisely mirrors what's happening in British aviation.

To continue the canned food analogy: suppose there has been a vicious beans war (which sounds messy, though safer than an asparagus-spear war). On the horizon lurks a possible rise in the cost of tin. The leading beans manufacturer holds a crisis meeting. A bright spark says "I know - let's pretend to customers that what we pay our suppliers for tin is a form of tax. And we'll add the cost to the price of our product in advance of the rise, so in effect they'll be paying us extra for exactly the same product."

Substitute air travel for beans and British Airways for the manufacturer, and you find out why fares are to rise by up to 15 per cent.

Just as anyone who is selling cans of beans needs tin, so anyone who is selling air travel needs airports. Airlines pay airports for the services provided, in the same way that they pay their staff and fuel suppliers; it is a normal commercial transaction. Yet after next weekend the cost of these passenger service charges (PSCs) will appear in the box on air tickets marked "tax".

The justification given for the change is airlines' fears that airport charges will rise when duty-free sales within the European Union end in July. When the airports increase their fees, the theory goes, passengers will see that the rise is not the fault of the airlines.

The move is mightily annoying for travel agents, as we shall see in a moment. But air travellers need not be concerned about the change so long as airlines do not increase the overall cost of the ticket. The national carriers of our two favourite holiday countries, Iberia of Spain and Air France, say that they definitely won't raise fares because of the move. But British airlines are another matter.

When asked whether it will take advantage of the change to raise overall fares, British Airways says that the question is inappropriate, since fares fluctuate all the time. Yet callers to BA's reservations line are being told that after next weekend, "tax" on flights will rise. Oh no, it won't. But, according to what BA sales agents are telling travellers, fares will.

To revert to the groceries analogy: upon learning that the can of beans is now 15 per cent more expensive than it was last week, the rational shopper would simply buy a different brand from a supplier who has not raised the price. In aviation, sadly, this is not always an option. KLM uk, which competes with BA, says that it will definitely raise fares after next weekend. Virgin Atlantic is considering making increases. British Midland says that it has no plans to do so; I shall be watching to see whether its fare for the 250-mile trip from Glasgow to East Midlands, already an ambitious pounds 153, goes up after next weekend.

EVEN WHEN fares do not rise, the travel agent will lose out as a result of this change. Imagine the bright spark at the beans company telling supermarkets: "You know you've always earned your profit margin on the whole price of the can of beans? We've decided that, from next week, you won't earn anything for the tin itself."

The parallel in aviation is that travel agents' commission, which is already being trimmed back by many airlines, will not be paid on the PSC element. "What next?", grumbled one travel agent yesterday. "Will they tell us they won't be paying commission on the part of the ticket price that they use to buy fuel?"

You will not be astonished to learn that the aviation industry has quite a bit of "previous" on price-fixing, which is why fares are regulated for the government by the Civil Aviation Authority (CAA). The watchdog apparently allowed the change to go through in the fond belief that it comprised merely a procedural adjustment, with no effect on fares. It will be interesting to see the CAA's reaction to the rises.

THE CAA also appears fondly to believe, according to a statement I have been sent, that the passenger service charge at British airports is a flat pounds 5. Wrong: each airport sets its own charges, and these vary wildly.

On a journey from A to B charges total pounds 17.80 if A is Aberdeen and B is Belfast, but only 50 pence is A is Fair Isle and B is Lerwick. Nor is there agreement on whether charges should apply to arriving or departing passengers. So get ready for some hilarious re-routings as travellers attempt to minimise these charges. It could make a good board game, a kind of aviation rival to Mornington Crescent.

In this game (called Terminal Twister, perhaps?), the square you definitely don't want to land on is Benbecula. This Hebridean airport charges a whacking pounds 16.20 for arriving passengers. Yet Benbecula would be a good place to start a journey, because there is no charge for departing passengers. Fly to Glasgow (where arriving passengers are not charged), then make your way by bus to Inverness; avoiding the pounds 7.40 departure charge at Scotland's biggest airport and the pounds 6.40 arrival fee for Inverness will more than pay for the fare.

From here you can dodge all charges by flying to Manchester (pounds 7.70 is charged on departing passengers, but nothing on arrivals) and getting the bus to Liverpool (where arrivals by air pay pounds 7.30, but passengers depart free of charge). A flight to any London airport incurs no charge - as long as you avoid City airport, where arrivals pay pounds 5.60.

The one flaw in this plan is that there are no longer any flights from Liverpool to London. But given the savings to be made, perhaps they will resume - in one direction only

THE DEMISE of duty-frees within Europe is just one factor in P&O Stena Line's decision to end the historic ferry link between Newhaven and Dieppe. As Gerard Gilbert predicted in these pages in December, the plug has now been pulled and the last ship will sail off into the Channel fog a week tomorrow.

Happily, a rival ferry company thinks that it can make a go of the route. Hoverspeed (0990 240241) has stepped in with a summer-only service, starting on 10 April.

This is excellent news for eclipse fans, who will be able to drift over to Normandy on the 7.30am sailing on 11 August, watch the sun disappear and then return at 6.15pm. All the car spaces are already booked on this date, but day trips for foot passengers cost pounds 12 return.

I'd love to view the eclipse from west Cornwall instead, but Great Western Trains is still refusing to take bookings for the event - indeed, the company says it has no idea what services it will be running from Paddington to Penzance in August.