Prime Minister Mark Carney announced his proposal for private investors to take over the operations of Canada’s major airports located in Toronto, Montreal, Calgary, and Vancouver. This shift in policy aims to keep the federal government’s ownership of airport land and assets while reallocating funds from major airport operating costs to smaller regional airports, potentially leading to reduced costs for travelers.
Currently, under Canada’s airport operational structure, private, not-for-profit airport authorities lease the airports from the government and manage everything from runway maintenance to terminal building upkeep independently. These authorities set their own fees and cover their operational expenses.
The Prime Minister’s plan suggests that investors could oversee airport operations through fixed lease periods, with Transport Canada retaining regulatory control. Legal expert Karen Hennessey mentioned that legislative adjustments would likely be necessary for Carney’s proposal, involving a concession agreement resembling a lease. This agreement would include government expectations regarding service quality, safety, costs, and employee management.
Private airport operations are uncommon in North America but more prevalent in other regions globally. Studies have shown that a significant portion of the world’s busiest airports involve private sector participation, with Europe leading at 43%, followed by Asia and the Pacific at 26%.
Carney emphasized the potential for Canadian pension plans to bring their expertise back home by investing in airports. The Australian experience with airport privatization has shown mixed results, with passengers facing increased costs but generally being satisfied with improved services.
Airport authorities in Canada have expressed caution regarding privatization, emphasizing the importance of investment discussions that align with growth and affordability for travelers. Opposition parties like the NDP and Bloc Québécois have voiced concerns about increased costs for travelers under the Prime Minister’s plan, while the Conservative Leader awaits further policy details before forming a complete opinion.
Previous attempts to privatize Canada’s major airports, as explored during former Prime Minister Justin Trudeau’s tenure, were met with mixed feedback. The government eventually decided against selling off Canadian airports in 2018 following the review led by former cabinet minister David Emerson, which highlighted the potential drawbacks of privatization on air travel costs for Canadians.
