BAA, the owner of Scotland's three main airports and the London-area terminals of Heathrow, Gatwick and Stansted, is facing a turbulent future less than two years after it was taken over by Ferrovial, the heavily-indebted Spanish infrastructure and construction company.

The airports operator, whose dominance of London and Scottish airports is being investigated by the UK competition watchdog, has been publicly humiliated by persistent problems such as long queues at security checkpoints and delays at Heathrow.

The recent chaos at the newly-opened Terminal 5, which BAA runs on behalf of British Airways, is nothing less than a "disaster", according to Willie Walsh, the chief executive of BA.

Passenger frustration has reached the boiling point at Heathrow - the UK's busiest airport with 67.9 million passengers last year - amid growing perceptions that BAA has put retail revenues before smooth travelling, an accusation that the company has rejected. Scuffles broke out last week at Terminal 5 after a number of BA flights were delayed and thousands of pieces of passengers' luggage were lost.

Aviation Minister Jim Fitzpatrick told the House of Commons that passengers using the new £4.3bn terminal had suffered "an unacceptably poor experience".

By the end of last week, however, operations at Terminal 5 were running a little smoother, but the damage to the public images of both BAA and British Airways will not be easily undone.

Airlines such as budget carrier Ryanair have been vocal in their criticism off BAA, calling on the government to break up the company and promote fresh ownership of the London region's airports. They have hit out at BAA over claims of high charges and poor service.

Ryanair said in a statement: "The security queues, flight delays and baggage chaos endured by passengers at Heathrow's Terminal 5 are symptomatic of widespread failure common at many BAA airports including Stansted and Gatwick where passengers routinely suffer long queues at security and passport control, as well as repeated baggage belt breakdowns.

"This abject customer service continues at the BAA airports because the CAA's (Civil Aviation Authority) regulatory regime has repeatedly failed to protect the needs of users because it is too busy rewarding the BAA with price increases."

Ryanair chief executive Michael O'Leary added: "(The) chaos at Heathrow provides further compelling evidence of the need to break up the BAA monopoly. We should allow competition between the London airports to deliver more efficient facilities, better passenger service and lower costs where the BAA airport monopoly has failed.

"If the BAA London airport monopoly was split up, competition would deliver better services and efficient terminals which actually work, as opposed to complicated Taj Mahals like Heathrow's Terminal 5. It is high time to break up this BAA airport monopoly."

In a rare display of unanimity, Ryanair, Virgin Atlantic, bmi and easyJet, recently held a joint news conference to call for the break-up of BAA.

The airlines' position was reinforced by a report from the House of Commons Transport Committee. It supported calls for an end to BAA's monopoly, saying the company had "mismanaged resources".

MPs on the panel said BAA had "failed to plan adequately for contingencies which were far from unexpected". Heathrow had lost its popularity and it was "regrettable that BAA ever allowed the position to get as bad as it did", the committee added.

Competition was being "stifled by common ownership of several major airports", with the natural development of the market being "held back", the report stated.

What was good for BAA was "not necessarily good for aviation" and there was "much to be gained from a state of affairs where BAA did not enjoy such substantial market power".

BAA is economically regulated by the CAA. The authority announced in early March that it would allow BAA to raise charge for travellers by 23.5% at Heathrow and 2% at Gatwick to pay for increased security and improvements at the airports.

The additional fees will help cash-strapped Ferrovial but were attacked by IATA, the International Air Travel Association. IATA, which represents more than 240 airlines around the world, said the higher fees were unjustified and would harm London's competitiveness.

BAA described the settlement as insufficient. It will allow fees at Heathrow to rise to £12.80 per passenger, and £6.79 at Gatwick.

The fee is charged for each departure or arrival at the airport. Although the charge is assessed against airlines, it is generally added to ticket prices.

"The (CAA) review does not recognise sufficiently ... the scale of the task we are embarked on (to improve airport facilities)," BAA said.

Nonetheless, BAA said the new charges would allow it to finalise refinancing plans.

The airlines bitterly criticised the rise in charges, accusing the CAA of caving into pressure from Ferrovial, which has sold a number of non-core assets, such as its UK duty-free shops, to raise much-needed cash.

City aviation industry analysts are starting to raise questions about the £9bn in debts which Ferrovial took on to buy BAA in the year before the global credit crunch rocked financial markets.

The group's latest accounts reveal total debts of around £23bn, with annual interest payments reaching an eye-watering £900m a year during 2007.

A Ferrovial spokesman said the group remains confident of refinancing the debt taken on to buy BAA "in the next three to four months".

Ferrovial's repayments are linked by ever-widening spreads to the Libor interbank borrowing rate, which has itself risen higher following the credit squeeze that began last August, offering little prospect of relief on interest payments.

Other pressures are likely to squeeze the balance sheet this year. In a little-noticed announcement in January, the company said it could potentially lose tax-breaks on up to £5bn in infrastructure work because of the Treasury's plans to scrap relief on industrial buildings during the next three years.

The pressures on Ferrovial have had a negative impact on its share price. The company's stock plunged to a 52-week low of 35.60 on January 22 of this year. Although the shares have recovered to around 47, they are still well off the 52-week high of 82.90 recorded on April 20, 2007.

Speculation has swirled around the City that Ferrovial might be forced to sell either Gatwick or Stansted airports or one or more of its Scottish assets in order to relieve some of its debt burden. BAA operates Glasgow, Edinburgh and Aberdeen airports. BAA's Scottish airports carry more than 80% of the country's air passengers.

The two big Scottish-based bus and rail empires, Firstgroup and Stagecoach have been mentioned as possible buyers if an airport was put up for sale.

Regardless of how Ferrovial's debt situation plays out, crunch time for BAA will come later this year when the Competition Commission brings down its decision on the company's activities in London and Scotland. Some City analysts are convinced the verdict will go against BAA, making its break up inevitable.