Examination of Witnesses (Questions 280
WEDNESDAY 9 JANUARY 2002
280. Gentlemen, I am very grateful to you. I
apologise for keeping you waiting but they have a bad Chairman
and we are running behind time. Can I ask you firstly to identify
yourselves for the record.
(Mr Lyle) Tim Lyle. I am the National Secretary of
the Transport and General Workers' Union's Civil Aviation Trade
(Mr Sealey) I am Roger Sealey. I am the Researcher
in the Transport and General Workers' Union responsible for the
transport sector which covers civil aviation.
281. Gentlemen, do you have any general remarks
you would like to make?
(Mr Lyle) Just by way of introduction, Chairman, to
say that we welcome the opportunity to present evidence to you
and to answer the questions that you will pose to us. Like everyone
around the world we were deeply shocked by the events that occurred
on 11 September and doubly shocked, as it were, because the cabin
crew and the flight attendants that were on the American Airlines'
planes were actually members of one of our sister unions. We have
obviously suffered since 11 September with the shedding of several
thousand jobs, which I am sure you are going to ask questions
on as we go through. We have tried to do our level best since
11 September to persuade Government to provide assistance to the
industry. Some of the documentation that we have provided to you
deals with what we think should be done in the short-term. On
the long-term maybe you will need to question us on that. There
are two apologies I have for the Committee. We did submit some
supplementary evidence on aviation security which was drafted
in response to a request from the International Transport Federation
to try and get a worldwide trade union response to security. In
the documentation that we supplied to you, which we drafted rather
quickly, it does say that we would expect the military, royalty
and their entourage to be the subject of security checks. That
is a drafting error. We refer to the entourage of royalty, we
are not in any way suggesting that the Royal Family
282. I am sure it will be a great disappointment
to the Queen.
(Mr Lyle) The other thing is on boarding it says "Match
all passengers to their bags. No bag must be loaded on a place
without its owner", it really should be "loaded on a
plane without its owner". We do apologise for that.
283. Not at all. It comforts us when other people
make mistakes. Could I ask since you said thousands of your members,
do we know exactly how many of your members have lost jobs since
(Mr Lyle) The headline figures that have been published
show 7,000 jobs at British Airways, although I have to say it
is 7,000 person equivalents. I was going to say manpower equivalents,
but I am not allowed to say that. That has been dealt with very,
very quickly. It was dealt with with 1,000 contractors actually
losing their jobs, agency workers. The other jobs have been dealt
with by introducing extended leave, unpaid leave, early retirement
and also job share. Prior to 11 September at any one time we did
have 400 cabin crew members seeking job sharing. It is a difficult
job. It is a job that requires you to try to live with the effects
of jetlag and try to live what many would regard as an unnatural
life, although it is a glamorous life. At any one time 400 were
volunteering for part-time jobs. We have accommodated a lot of
the 7,000 like that. In terms of the spin-offs, in aircraft cleaning
we have lost something like 150 jobs, in fuelling companies something
like 30 jobs.
284. Each company you are saying?
(Mr Lyle) This is throughout the companies. I can
be a little bit more specific in terms of catering. Lufthansa
Skychef 193 jobs, Gate Gourmet 320 jobs, Alpha 65 jobs. Being
a little bit more specific in cases of ground handling companies:
Aviance, a ground handling company which is based at Gatwick,
the old Gatwick Handling Company, 270, ServiceAir, which is a
very large ground handling company 414, Ground Star 20. We would
then make up the rest of what are 10,900 jobs by going through
courier services, Gulf Air, American Airlines themselves, Virgin
Atlantic, BMI and JMC. I have tried to highlight to you in some
specific terms what has made up nigh on 11,000 jobs for us. I
will try not to go on at too great a length because obviously
I recognise that there may be a lot of questions, but also jobs
that rely upon the aviation industry because, as we know, 180,000
people work in the industry and a further 380,000 rely on it.
Our latest figures that we have from LRD show us that in engineering
as a consequence of 11 September 6,373, tourism 3,000, travel
agents 1,750, airport support services 1,010 and the hotel industry
285. We would really like to know whether you
can isolate how many of those figures that you have quoted, particularly
where they are your members, are because of the events of 11 September
or how many of them were in effect in the pipeline before that
date. Is that a sum you can do?
(Mr Lyle) I think I could do that. I think in terms
of the ground handling companies, the catering companies, the
refuelling companies, the support service companies, every single
job that has been lost there is as a consequence of the airlines
reducing their services. Those were jobs that would not have been
lost prior to 11 September. I think the important thing that I
would respond to, because I gather the thrust of the question,
is that certainly in British Airways because of the downturn in
the North Atlantic traffic which was as a consequence of foot
and mouth and the downturn in the American economy we were facing
1,800 job cuts at British Airways. We were also facing further
reductions in recruitment, so it is not just 1,800 jobs going,
it is less people being employed. We were also facing entering
into negotiations with British Airways about changing the way
that we work. It would not be giving away a secret to say that
overtime is endemic, on the ramp in the industry, and British
Airways were in the process of starting a dialogue with us about
cutting out levels of overtime. 11 September, of course, made
those reductions even worse. Very shortly after 11 September we
were then faced with a further 5,200 jobs which made it 7,000.
British Airways have argued, and it is very difficult for us to
combat that argument, that the 5,200 jobs have come as a direct
result of 11 September. We were meeting with British Airways and
seeing figures such as 33 per cent reductions in business across
the North Atlantic and the North Atlantic, of course, is what
produces the profit for British Airways, it goes in the profit
bucket from the North Atlantic and unfortunately falls out the
bottom from the rest of the world. Those sort of figures place
British Airways in a position where they will say to us that the
cashflow was such that they were losing £125 million per
month. Whilst one should not base one's arguments and responses
to a company merely on anecdotal evidence I did spend quite a
lot of time at the airport, receiving and getting the picture
of the load factors and it is true that there were planes flying
across the North Atlantic with less than 100 people on them. Personally
I flew to Washington on a 777 and there were 98 people on board,
even worse only four in first class and only 15 in what we would
call club class, so the profit side of the cabin was virtually
empty. The whole of the plane was empty but it was more exacerbated
by the fact that the front was emptier. Quite frankly we were
prepared as unions to go along the negotiating trail with British
Airways prior to 11 September and post 11 September when we were
beginning to see the sort of figures that were coming.
286. Can I ask if you have any idea how many
jobs have been lost with British Airways since it was privatised
in 1987,considering it has taken over a number of other airlines?
(Mr Lyle) I cannot give you a figure. I do know that
last year something like 3,000 jobs went out of British Airways
287. Perhaps you can do me a little note on
(Mr Lyle) One of the difficulties that we have with
British Airways is that with job losses, whilst we as unions are
very, very opposed to them, British Airways do not have a difficulty
getting rid of people because their redundancy package is such
that they throw money at them.
288. The questions we ask are not to be taken
as pejorative, we are after information. If we did not want information
we would not ask. What I need from you are figures. What about
the priorities for the United Kingdom government, what are they
to do in order to help the aviation industry and the challenges
at the moment?
(Mr Lyle) Some of the thingsyou are going to
tell me off for not answering your questionyou have done
we are rather pleased about. We are pleased that the government
has announced Terminal 5. We are pleased that there is £40
million for the four days that the airspace was closed off. I
think what we would say is that the further assistance that the
industry needs is it needs a level playing field, as it were,
with the American carriers. We know the money that has been given
to the American carriers. Mr Sealey can update us a little bit
more, they were not only compensated for the four days they lost
their space, but they have been compensated for on going losses.
The other thing that the government certainly could do in order
to assist us in cashflow is it could suspend the collection of
airport passenger duty. Airport passenger duty is worth roughly
one billion to the industry. It is important not that it is scraped
completely, I accept that would probably be non-sensical, but
avoiding collection for some time would be of assistance in cash
flow. I believe the other thing the government could do is it
could underwrite the cost of the increased security burden that
is falling upon both the airlines and the airports.
289. Have you figures for how much we are talking
about, Mr Lyle?
(Mr Lyle) Mr Sealey can help us on that one.
(Mr Sealey) I can give you an illustration which might
290. I want real figures?
(Mr Sealey) This is from El-Al At the moment El-Al's
security costs are about 25
291. I am going to stop you there, Mr Sealey,
this Committee has gone to London Airport to look at El-Al's operation,
it is an extremely clever and well founded operation, it is an
expensive operation because it is a good operation. El-Al security
have the right to phone anybody in Israel. They have absolutely
carte blanche when they want to get information. They are
not really comparable with British airlines. I can tell you having
travelled on both airlines over many period of years the El-Al's
situation is different.
(Mr Sealey) The point I was going to make was what
they pay themselves, let alone what they receive in state aid,
is in effect two per cent of their revenue
292. That is helpful, although I think it is
also slightly unlikely in the situation we are talking about.
(Mr Lyle) I have found it rather difficult to get
a handle on the figure. I was with BAA only yesterday and put
it to them that I was coming to you today and I asked them what
the figure would be and unfortunately I did not even get it from
the British Airports Authority. I do not think in the evidence
they submitted to you they have put a figure. The nearest we got
to a figure was evidence that was submitted or questioned last
week, when I believe one of the respondents quoted a figure of
£4 million for the London airports
Chairman: Keep digging, Mr Lyle, and come back
to us when you have something.
293. You have mentioned the government's action,
which has been very, very helpful, what about the industry itself?
You have indicated where government could take further action,
what about the industry itself? Do you think the industry is responding
in an appropriate fashion?
(Mr Lyle) In terms of the way they are dealing with
294. In terms of the problems affecting the
industry and your members?
(Mr Lyle) I think in truth the major carrier that
we have our membership in, which is the 23,000 members we have
at British Airways, I believe they were responding prior to 11
September. I believe they were responding in a way that meant
they were going to get an agreement with us. One of the basic
things that has been agreed with British Airways right the way
throughout this is that there will be no enforced redundancies
and, in fact, there have been no enforced redundancies since we
started. I know that people in Belfast have lost their jobs but
there is a redeployment agreement. The 40 people that lost their
jobs could have transferred to the United Kingdom, one may say
that is not much of an offer, but at the same time several people
did transfer. In the way we have been dealt with by the industry
certainly those large carriers that have good industrial relations
and deal with us in a sensible way have dealt with us well. One
of the things about the aviation industry is it is highly unionised.
We as a Union have something like 50,000 members in that industry.
Most of the companies we are dealing with have, to a large extent,
negotiated agreements round things like short-term working, job
sharing, early retirement. I am not, at this stage, being critical
because I would not have been critical, I would have done something
295. How concerned are you that the recession
and the events of 11 September, the recession in the United States
in particular, will have further down the supply chain?
(Mr Lyle) From the sort of figures that I have given
to you I am deeply concerned about that. Not to belittle the issue,
this is about the textile workers in Bradford who have lost their
jobs because British Airways are not ordering so many uniforms.
The spin-off from 11 September down the line is very, very serious.
That is why we as a Union thrust our argument in providing some
short-term aid to the industry, because we certainly are confident
in the long-term that the industry will grow again. We only had
to look at the papers yesterday to see that easyJet are purchasing
35 airbuses. Ryan Air is increasing its passenger loads. Go passengers
are up I think 57 per cent. It will come back. One of the reasons
why we as unions have argued for no redundancies but are dealing
with the issue of part-time work, short-term work and extended
leave is that there is a confidence that the business will come
296. Nevertheless, in spite of Ryan Air, Go
and easyJet and the others, there has been a drive towards consolidation
over years in particular, do you see that consolidation process
continuing? If so, what assessment of the implication have you
(Mr Lyle) I can only answer the question with some
sort of gut feelings about it because I do not run an airline.
My own view is, yes, there will be consolidation. My own view
is there will not be the number of European carriers when we come
out of this that there are now. I do have a confidence to believe
that one of those that will survive and gain from it the fact
that it will survive will be British Airways. If you ask me for
another survivor I would say Lufthansa, if you ask me for another
survivor I would say Air France.
297. Not for the same reasons, Mr Lyle, but
we will not go into that.
(Mr Lyle) Certainly some of the European carriers
will go down. We have seen SABENA and we have seen Swiss Air.
It was mentioned earlier on, we have seen Gill, these, I think,
are the first of many.
298. In your supplementary evidence you refer
to all bags being loaded on the plane with the owner. Do you have
any specific evidence that any bag travels without its passenger,
because that is an infringement of existing international law?
(Mr Lyle) One of the things that the airports tell
me is that they never lose a bag, what happens is they misplace
them. There is plenty of evidence that people arrive on holiday
or on business and their bag is not on the carrousel
299. Surely not, Mr Lyle!
(Mr Lyle) By definition if the bag is then going to
get to them it travels without the passenger.