Sydney Airport Passing Rising Security Costs to Passengers

SYDNEY, July 20 AAP - The cost of upgrading security at Australia's biggest airport is being passed on to passengers, Sydney Airport boss Max Moore-Wilton says. Sydney Airport Corporation Ltd's earnings rose 14 per cent to $495 million in 2004/05 thanks to higher passenger numbers and a revenue boost from its property and shopping interests. But increased security measures required by the federal government pushed up its operating expenses by 8.7 per cent to $124 million, excluding one-off expenses. Sydney Airport said it has its own ongoing security costs - having spent $27 million on security in 2004/05, and a forecast of $40 million in the current financial year. But it is the mandated security government costs that are passed onto passengers. Mr Moore-Wilton said government mandated security requirements currently underway include $90 million committed to implement 100 per cent checked baggage screening by December 2005 at the international terminal. He said Sydney Airport would be participating in a review over the next few weeks by a federal government-appointed independent expert to examine the threat from serious and organised crime at airports. This will also determine the ongoing costs required by the government, including the implementation of its counter-terrorism first response plan. "There is likely to be further security expenditure over the next 12 months in addition to the checked baggage screening," Mr Moore-Wilton said. "We don't get any assistance at all, it is actually passed through onto passengers." Mr Moore-Wilton said the airport's operating expenses were flat, excluding the security costs, and the government should fund the increased security measures. "We've taken the view for a number of years now that the federal government should basically - out of the surplus it has in terms of the charges it puts on airline passengers in terms of taxes for departing passengers - that they should fund this counter terrorism first response, but they have not agreed to do that." A federal parliament Public Accounts and Audit Committee visited Sydney Airport today ahead of tomorrow's public hearing for its inquiry into aviation security at the airport. Sydney Airport manager Southern Cross Airports Corporation Holdings (SCACH) today reported a 14 per cent increase in earnings before interest, tax, depreciation and amortisation (EBITDA) to $495.2 million for 2004/05, excluding non-recurring expenses. Mr Moore-Wilton, Sydney Airport Corp's executive chairman, said the result was boosted by a 12.9 per cent increase in revenue to $619.2 million. "Sydney Airport has delivered another strong financial year performance thanks to ongoing passenger growth and a diversified revenue base," he said. "Passenger growth continued to underpin a solid performance from retail, property and other commercial activities." The airport's aeronautical revenue growth was up 7.1 per cent in the year to June 30, in line with traffic growth. Sydney Airport's passenger numbers totalled 28.289 million for the financial year, its major shareholder Macquarie Airports (MAp) said. Commercial trading revenue increased 9.8 per cent, with the property business up 15 per cent over the financial year. Duty Free shoppers and a redevelopment of the airport's terminal one food court helped boost retail revenue by 13.3 per cent. Sydney Airport is also spending more than $100 million to prepare itself for the arrival of the Airbus A380. Qantas is expecting 12 of the Airbus A380 double decker new generation super jumbos from