Fees for aeronautical radio licences

Summary

We have decided to implement fee changes broadly as we proposed last year

1.1 In this statement we are setting out our decision to revise the fees payable for licences to use aeronautical VHF communications frequencies at ground stations (typically, aerodromes and air traffic control centres). We have concluded that the rationale for the fee changes set out for consultation in December 2009 was robust and the proposed fee levels broadly appropriate.

However, we are introducing a new low coverage/low cost licence product

1.2 Most fees will increase in line with the proposals set out for consultation. However, we have decided that fees for frequencies used with Tower, Aerodrome Flight Information and Air/Ground services should differentiate between very localised assignments, mainly used by small aerodromes, and the generality of such assignments. Fees for such assignments with Designated Operational Coverage (DOC) no greater than 10 nautical miles radius and 3000 ft maximum service height will, therefore, rise to £650 by the end of the period of phasing-in instead of £2600 as we had proposed.

Fee increases will be phased in over several years starting in April 2012

1.3 As proposed, larger fee increases will be phased in over several years, with the first increases implemented in April 2012. This means that invoices payable on or after that date will attract revised fees. Subsequent changes will take effect in April each year. There will be no retrospective adjustment of sums already paid. Fees for each 25 kHz channel assignment will increase as follows (fees for 8.33 kHz channels will be reduced pro rata);

Service type	Fee today	2012/13	2013/14	2014/15	2015/16	Subsequent
Fire and distress frequencies	£25	£0	£0	£0	£0	£0
Block of shared sporting frequencies (unpowered flight and Microlight)	£25	£75	£75	£75	£75	£75
Offshore mobile stations	Included with offshore fixed fee	£75	£75	£75	£75	£75
Surface communications (incl Departure ATIS), and Operational Control and offshore fixed stations	£250/£150	£350	£350	£350	£350	£350
Air/Ground, Tower and Aerodrome Flight Information with limited DOC	£150/£100	£350	£500	£650	£650	£650
Other Air/Ground, Tower and Aerodrome Flight Information	£150/£100	£350	£500	£1200	£1900	£2600
Area control, Approach, Arrival ATIS, ACARS and VOLMET	£250/£150	£1000	£2000	£3000	£6000	£9900
VHF Digital Links per frequency (50 kHz channel spacing)	£250	£2000	£4000	£6000	£12000	£19800

Table 1

1.4 Temporary licences will continue to be available and will attract a fee of one twelfth of the annual fee for each month or part month, subject to a minimum fee of £75.

We have decided not to complicate fees by applying geographic discounts

1.5 We had proposed that fees for services with localised coverage should be discounted in areas of the far north and west of the UK where demand is less pressing. We agree with those stakeholders who argued that this would add a disproportionate level of complexity. We have decided not to implement these discounts which, in any event, would have equated to only about 1% of the total value of fees payable.

We intend to consult further on the possibility of introducing bespoke fees which more closely reflect the coverage of each assignment

1.6 We will consider further the proposals made by the CAA and others, in their responses to our consultation, that a more granular fees structure reflecting the Designated Operational Coverage of each particular assignment could offer advantages. We will take technical and operational advice from the CAA to see whether an appropriate bespoke pricing option can be devised. This option would need to be consistent with the principles as well as the cost estimates which underpin the fees which we are announcing in the current statement. The benefits would also need to be weighed against the additional administrative costs which a bespoke fees model would incur.

1.7 If a practicable bespoke fees algorithm can be devised, this could provide incentives for frequency users to consider using the minimum Designated Operational Coverage consistent with their operational and regulatory requirements, thus potentially releasing spectrum for other aeronautical users, and making it easier over time for the CAA to accommodate current and future demand for assignments. It may also present some users with the option of modifying their operations so that these can be effected using a more localised, lower cost, Designated Operational Coverage if the generic fee is not considered cost effective.

1.8 If, after further consultation, we decide to implement a bespoke fees algorithm for some service types, the generic fees announced in the current statement would generally serve as de facto ceilings to the fees payable for each service type. We note, however, that some assignments have Designated Operational Coverage significantly more extensive than the norm for the particular service type. Subject to the further consultation, it may be necessary to restrict the generic fees set out in the present consultation to assignments which more closely approximate to the norm, with more extensive assignments attracting a fee based on the bespoke formula. We note in particular that service types Air/Ground, Tower and Aerodrome Flight Information with Designated Operational Coverage greater than 25 nautical miles radius present particular issues in this respect. To provide users with a degree of certainty about future fees, we are confirming that generic fees set out in the present statement will be available to all licensees until at least 30 March 2014.

Fees for aircraft radio licences will reduce to one third of today’s rates

1.9 Our December 2009 consultation made no proposals to alter the fees payable for licences to use radios in aircraft. However, we intend to make these fees payable every three years instead of annually. The sums payable on each occasion will remain unchanged, representing a pro rata two thirds reduction in licence fees.

Next steps

1.10 Before these changes can come into force, we will need to make revised fee regulations. During 2011 we will publish draft fee regulations setting out the generic fees announced in the current statement. The same draft fee regulations will also include the change to three-yearly payments for aircraft radio licences. We will allow one month for interested parties to comment on whether the draft fee regulations accurately reflect the decisions set out in the current statement, before formalising the new regulations. These will take the form of a Statutory Instrument, which has the force of law.

1.11 If an appropriate arrangement can be devised, consistent with our spectrum management objectives, for calculating bespoke fees, this too will need to be subject to consultation. In principle, it is possible that this option could be implemented at the same time that the generic fees are implemented in April 2012. In any event, if the option proves to be attractive, it should be capable of being implemented at an early point in the five years over which generic fees will be phased in, and before those fees are fully implemented in April 2016.

The full document is available below