Select Committee on Environmental Audit Minutes of Evidence

Examination of Witnesses (Questions 260-279)

Tuesday 1 July 2003


  Q260  Chairman: I was getting my retaliation in first!

  Mr Darling: I thought that. Sadly my radio alarm was set for two minutes into your interview. As I was listening I thought this sounds very familiar and then I realised with horror this was the day I was coming to see you. There clearly are arguments to be had. For example if you take low cost air travel, in 1998 seven million people went by low cost airlines, today's figure is 35 million, that is a very large number. There are all sorts of considerations we need to take into account. The central point is not just as a country but throughout the world we have to take a view on what we do to make sure that the environmental cost of air travel is met. That is easier said than done when you are dealing with a global industry than if you are dealing with a purely domestic one.

  Q261  Mr Barker: Surely sustainability means more than just an economic cost? You cannot just measure sustainability—it is a financial cost—can you?

  Mr Darling: As you will know there are a whole host of ways in which you might want to look at it.

  Q262  Mr Barker: I am trying to quantify this statement you have just made that all transport must be stainable?

  Mr Darling: What I mean by that is that when we plan for the future, when we take account of the fact that as a country we become more prosperous, we want to travel more, we have more reasons to travel we should try and do that in a way that is sustainable.

  Q263  Mr Barker: What does sustainable mean to you?

  Mr Darling: What I mean by it is that you have to balance the fact that if you move round at all there is clearly some environmental impact with the fact that you should do your best to try wherever you can to mitigate the effect of that. You cannot just carry on blindly as if somehow the damage to the environment does not matter. I know there are many people who have had a stab at giving a precise definition of sustainability but what I mean by it is that what we have to do is to so arrange our policies that what we do is something that is capable of lasting without doing untold damage to the environment in which we live. It is always going to be a matter of balance and a matter of judgment as to where you strike that balance, especially so in the case of air travel.

  Q264  Mr Thomas: Can I just ask you, Secretary of State, about the SPASM model which I understand lies behind some of the assumptions in the consultation. This internal model that you have in the Department of Transport I understand was re-run using new co-ordinators, as it were, by the CPRE and Friends of the Earth amongst others. Some of the factors they put into that were factors that are not at the moment being consulted on, like VAT on aviation tax similar to that on car tax and the abolition of duty free. When that model was re-run by your civil servants using the new parameters set by these organisations it came out with the need for no new runway anywhere in the United Kingdom by 2020 and a much significantly reduced amount of air travel because precisely, as you said a little earlier to this Committee, you now had air travel actually meeting the real cost of its pollution. Why was that not part of the consultation?

  Mr Darling: The whole point of a consultation is to get people's views on what they think ought to happen. Some people say we should put VAT on fuel, this is where you get the figure of £8 or £9 million referred to on the radio this morning. If we follow that advice it is to put something like a nine-fold increase on air passenger duty. This is quite an interesting, philosophic question as to whether your policy ought to be to price people off airlines. Let us be in no doubt what that means, that means each and everyone of us sitting round this table saying to our constituents, "some of you are not going to be able to fly". That is what pricing off actually means.

  Q265  Mr Thomas: Or not so often perhaps?

  Mr Darling: Take the person who is going to Italy this summer from your constituency, what you are saying is, you can only do that if we are putting £100 on each ticket, or whatever it is.

  Q266  Mr Thomas: It would cost them five times more to travel from my constituency to Gatwick or Heathrow than it would to travel to Italy, there is something warped and perverse in the system, is there not?

  Mr Darling: That is a separate point.

  Q267  Mr Thomas: It is all transport.

  Mr Darling: Of course it is all transport, I will come back to those points. In relation to air travel if your primary objective is to reduce the emissions, to reduce the environmental damage there are different ways in which you can do that in relation to trading schemes and other constraints, and so on. Of course that can be done at a European level, to some extent it is frankly something that would have to be done on a global level. You could take the other approach, I would not characterise all of the Friends of the Earth saying that, some people say you just price one section of the population off and say, sorry you cannot go. I think there are difficulties in that. I think there are real political difficulties in saying that and you also have difficulties in the sense of saying, "sorry only rich people can fly". That is a view that you are entitled to take if that is the one that you hold. As far as my general philosophy in relation to transport is concerned, domestic and international, as the world becomes more prosperous people will want to travel more. Clearly we want to encourage people to travel in a way that is as least environmentally damaging as possible. One of the other by-products of the policy you are advocating is if you say to people, "you and your family cannot fly to Spain", what will happen in some cases is people will climb into their cars and try and drive across. I am not sure I want to encourage that sort of thing. As you know road travel has its risks and it is also environmentally damaging. The point you make is, yes, there are people who were consulted, who have come in to us and said what we should do is shove up taxes. I indicated earlier this year that I thought the policy that was predicated on saying to a large section of the population, "sorry, you are not allowed to fly, that is the province of a few rich people", does not seem to me to be a terribly great place to start.

  Q268  Mr Thomas: Accepting that as a philosophical point there are also hard practical points and practical alternatives as well in terms of the expansion of runways in the south east of England and access to that particular mode of transport. When 35% of my constituents cannot afford a car there is obviously a pricing mechanism going on here that says they choose not to run a car because of price and yet we allow air travel not to bear those similar costs. I simply want to ask you, what, in fact, is your philosophical approach to this? Is it whether it needs to be done at European level or whether it needs to be done at an international level? Is it to try and work for that greater cost to be borne throughout the whole range of aviation or is it simply to allow for the expansion of on-going low costs that we have seen?

  Mr Darling: I think there are two parts to this, firstly in relation to our policy it is clearly set out in the consultation documents which we published last year, which I referred to, that the Government's belief is that the "polluter pays" principle is right. The nature of how you do that and the rate at which you can do it depends to a large extent on the international remit, because that is the way that aviation is constructed. Even if you pursue that line the question still arises, this is what we are consulting on, do we need any more airport capacity in the South East and indeed in other parts of the country? As you know in Wales, for example, there are many people who want traditional airport capacity for many reasons. If you look at what has happened in relation to the cost of flying it is not just taxation, the reason the low cost airlines are so much cheaper is because to a large extent they have stripped out the selling costs. If you add some of that back in it might not have the effect that you want to achieve.

  Q269  Mrs Clark: Can I just take you back to the whole environmental issue, you have just said that you are concerned about the possibility of people not flying to Spain but going on the road and using their cars. Is it not true that the aviation industry is turning into a total pariah, in much the same way that the nuclear industry has a bad environmental reputation, and in fact chasing up to producing about one third of CO2 emissions. What do you say to all of that?

  Mr Darling: With respect, the language you are using is somewhat extravagant. I think you are right that the airline industry throughout the world is a major contributor to harmful emissions, which is why—the point I made to Simon Thomas in relation to that—that is something that is going to have to be dealt with globally, it is something that the Government believes does need to be tackled. My point in relation to travelling to Spain, and I just cited that as an example, is if people want to travel and visit places clearly there is a balance to be struck in relation to the cost of air travel and the corresponding cost that would arise if you shifted more people on to the roads travelling across continental Europe. That is one of the considerations the Government would have to put in place.

  Q270  Mr Challen: I would just like to go back to the question of what I should tell my constituents, particularly in relation to the SPASM report, and the revised way it was done with Friends of the Earth and the rest of them. I do not think if I went to my constituents and said, "would you mind paying the average increase in inflation on your air fares?", they would object to that. I think they would find that a reasonable proposition, rather than the assumption that we seem to be making that air fares are going to fall by 2% every year. Should we not be doing something to correct the assumption that the public have that if you fly from Liverpool to Dublin for £7 one way that is creating false assumptions for the public and that this is a sustainable way of getting from one place to another?

  Mr Darling: Firstly, what was being put to me by Simon Thomas from the Friends of the Earth submission or even the Royal Commission is it was not an inflation-only increase they were talking about. The Friends of the Earth submission, or at least people who are arguing that point, suggested the equivalent of a nine-fold increase in air passenger duty and the Royal Commission suggested £70 on a return ticket. It is not just inflation you are talking about, in relation to sustainability if you look at these tickets, yes, you can get some for single figure returns, but I think anyone who tried to book these would see that is not universal. I made the point in the House fairly recently in terms of long-term sustainability and economic sustainability that airports would not be able to last indefinitely by letting low cost airlines come in paying virtually no landing charges. Although these agreements are commercially confidential it is well known the low cost airlines can drive a pretty hard bargain with some airports that are anxious to get them. If at some point you need to renew your runway or re-build a terminal building you have to get income from some point. All of these are things that we need to consider in terms of whether something is economically sustainable or environmentally sustainable. That was the whole point of the consultation and the whole point of considering the conclusions that you no doubt will come to when you consider your report.

  Q271  Mr Challen: The issue of the re-done SPASM report is that you could introduce these extra charges or taxes or VAT over a period of time incrementally, you would not just turnaround and say all of a sudden we are going to change you, the passenger, with a £70 charge. Why can it not be done incrementally so that we are seeing this gradual expectation growing amongst the travelling public that things are always going to get cheaper and therefore they are going to travel more?

  Mr Darling: As people become better off in real terms they will want to travel more. That point needs to be kept in the front of our minds.

  Q272  Mr Challen: That is a different issue. Personal income is one thing—

  Mr Darling: It is a related issue. If people have more money at their disposal they travel more. Self-evidently that has happened in the last 30 or 40 years. In relation to the modelling you do you can have all sorts of assumptions, as you know, and they will come up with a different range of results. The whole point of us consulting was to look at all these things, hear what people have to say and at the end of the year we will set out our conclusions.

  Q273  Mr Challen: I certainly would not go round to my constituents and suggest to them they should have some limit on their income.

  Mr Darling: I bet you would not.

  Q274  Mr Challen: That might not be—

  Mr Darling: A very short-term investment I should think!

  Q275  Mr Challen: We are talking about two entirely different things. I accept that if somebody's personal income goes up they might wish to travel more but if air travel is not to be contained in a sensible way which reflects the sustainable needs of the environment, and so on, we do need to have a more positive approach to it. Your own consultation is based on a forecast growth of about 4% every year until 2030, is that really sustainable?

  Mr Darling: The whole point of the consultation was to put figures out to the public domain and to get people coming back saying whether they thought we were right or wrong. I know there has been a large number of responses on that point and when we have them all we can then look and see what assumptions they have made, what we have made and come to a conclusion. That is the whole point of consultation.

  Q276  Mr Challen: The Aviation Environment Federation suggested this growth in passengers would mean a new Heathrow every three years by 2030, is that sustainable?

  Mr Darling: I would be surprised if such a proposition was sustainable, never mind the assumptions behind it.

  Q277  Chairman: It is your proposition.

  Mr Darling: We are not planning to build a new Heathrow every three years.

  Q278  Chairman: You are projecting growth of 4% a year.

  Mr Darling: We are putting these figures out in the public domain to consult upon. Had you been questioning me now and the consultation had been our actual conclusions you would have been on stronger ground. We are consulting. The whole point of consulting is to say to people: What do think? Do we have our assumptions right or do we have them wrong? Then we are going to have to sit down, apply our judgment to it, publish our conclusions in the White Paper at the end of this year and people will then, no doubt, say, "yes, you are doing the right thing" or "no, you are doing the wrong thing".

  Q279  Mr Challen: In the course of the consultation one is able to look at the premise of that consultation to see what sort of indicators, messages or signals the Government might be issuing. In the South East Airport Consultation it says, "the objectives for airports is to maximise the economic and social benefits while trying to minimise the environmental impacts down". "Trying to minimise environmental impacts down" does sound rather weaker than simply saying we are going to maximise the economic social benefits. Is that a signal to people as to what the White Paper is going to contain?

  Mr Darling: Not really, no. I understand that you and others sitting in this room and watching will be anxious to get whatever signal they want. As I said right at the start, you will get the conclusions when I told you you will get them, at the end of this year, and you are not going to get them before then. In relation to that point the point we are making there is that as a country, as members of this House we are going to have to reach a judgment as to the economic importance of air travel. When I made my statement last year I made the point about the employment generated from air travel, Heathrow employs something like 60,000 or 70,000 people in greater west London. Look at the economic importance to the whole country in terms of air freight, in terms of passengers, you have to look at that and alongside it say, "what damage does it do?", or "how do you mitigate the damage that it does to the economy?" You as Members of Parliament as opposed to members of this select committee have to form a rounded view on what these things are. All we are saying in the select committee is the aircraft industry is of significant importance to this country but we have to do things in a way that do our best to mitigate environmental damage.

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2003
Prepared 29 July 2003