Supplementary memorandum by the Department
for Transport, Local Government and the Regions (NAT 2A)
NATS FINANCES INQUIRY—HEARING
ON 1 MAY
At the above hearing we undertook to provide
the Committee with additional information to assist it with this
inquiry. I am sorry it has taken a little longer than we would
have liked to assemble the necessary documents.
I am pleased to enclose the following information:
1. Copies of correspondence relating to the
capital structure of the NATS PPP deal
At the hearing Mr Griffins undertook to provide
the Committee with copies of his written replies to the letters
dated 11 and 15 June 2001 received by him from Sir Roy McNulty,
then chairman of NATS, relating to the capital structure of the
NATS PPP. On re-examination of our files we have found that Mr
Griffins did not in fact respond in writing to these letters but
dealt with the issues raised in discussions he had with Sir Roy.
However, we appreciate that the Committee was
interested in the Department's reaction. This was set out in writing
in response to the reservations expressed by the Civil Aviation
Authority (CAA) about the NATS capital structure. I hope the Committee
will therefore find it helpful to see the relevant correspondence
between the CAA and the Department. I accordingly enclose copies
of a letter from Mr Andrew to Mr Griffins dated 23 May 2001, Mr
Griffins' reply to Sir Malcolm Field dated 17 July 2001 and Sir
Malcolm's response of 20 July 2001. (Annex 1)
2. Graphs detailing the effects of major incidents
on transatlantic air traffic
The Committee was interested in comparisons
of the effects on transatlantic traffic between the events of
11 September and other major incidents, such as the Gulf War and
Lockerbie. I accordingly attach a graph detailing the percentage
growth in North Atlantic flights in the months following 11 September,
Lockerbie and the Gulf War period, as compared with the corresponding
month in the previous year. (Annex 2)
3. Department's forecasts for air services
The Committee asked for copies of the Department's
forecasts of the demand for air services.
I attach the latest forecasts produced by the
Department, which were published in 2000. The table details forecast
terminal passenger numbers at UK airports from 1998 to 2020, and
the graph illustrates actual and forecast passenger numbers at
UK airports from 1975 to 2020. (Annex 3)
At the mid-point of the forecasts, air traffic
at UK airports is expected to grow at an average 4.25 per cent
per annum up to the year 2020. It would grow at an average of
3.6 per cent and 4.9 per cent under the low and high scenarios
respectively.
Please let me know if the Committee would like
clarification of any points in this information.
I hope this is helpful.
David Jamieson
Parliamentary Under Secretary of State
20 May 2002
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