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Air Transport

12.31 pm

The Secretary of State for Transport (Mr. Alistair Darling): With your permission, Mr. Speaker, I would like to make a statement on the future of air transport.

Today, I am publishing a White Paper that sets out the strategic framework for development for the next 30 years, against the background of wider developments in air transport. It is necessary to look ahead over a 30-year time scale. It is essential that we plan ahead to meet the pressures that we know we will face as a result of a growing economy, and in a world where people can, and will want to, travel more for business and leisure. Only the Government can provide such a framework to enable everyone to plan ahead.

First, let me set out the context. Air travel remains crucial to our growing economy. Some 200,000 jobs depend on it directly, and some 600,000 indirectly. There has been a fivefold increase in air travel in the last 30 years; indeed, half the population flies at least once a year. The growth in passengers travelling in the low-cost, no-frills sector has been dramatic. Five years ago, just 7 million people flew on low-cost airlines; this year, we expect the number to reach 47 million. A third of the goods that we export by value go by air, and that figure is increasing. Indeed, the amount of air freight at UK airports has doubled since 1990.

The Government recognise the benefits that the expansion of air travel has brought to people's lives and to this country's economy. Its increased affordability has opened up the possibility of travel for many people, and provides the rapid access that is essential to many modern businesses. But we have to balance those benefits against the serious environmental impact of air travel, particularly the growing contribution of aircraft emissions to climate change, and the significant impact that airports can have on those living nearby. That is why the Government remain committed to ensuring that, over time, aviation meets the external costs that it imposes. The White Paper sets out proposals to tackle aviation's greenhouse gas emissions by bringing it within the European Union emissions trading scheme. And the Government will continue to play a major role in seeking to develop new solutions and stronger actions by the appropriate international bodies.

The White Paper also makes it clear that we will legislate to strengthen and clarify the powers to control noise at airports, and to allow us to direct airport operators to levy higher charges on more polluting aircraft. Similar charges in relation to noise have helped to bring about significant noise reductions at the major London airports. But we can, and will, do more to reduce both noise and air pollution.

Some of our major airports are already close to capacity, so failure to allow for increased capacity could have serious economic consequences. But that must be balanced by the need to have regard to the environmental consequences of air travel. Simply building more and more capacity to meet demand is not sustainable. Instead, a balanced approach is required that recognises the importance of air travel to prosperity, but which seeks to reduce and to minimise the impact of airports on those living nearby and on the natural environment.

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I should also make it clear that the White Paper cannot, by itself, authorise any particular development, but it does set out a policy framework for future decisions. In the light of the White Paper it is for individual airport operators to bring forward proposals that will then be subject to the usual planning process. The White Paper sets out a strategic framework for the development of airport capacity. It sets out our conclusions for every part of the country and copies will be available from the Vote Office in the usual way; and I have also written to every Member setting out our proposals in more detail.

Let me set out the Government's conclusions. First, in Northern Ireland, as elsewhere, there has been a rapid increase in air travel. We support the development of Belfast International airport within its existing boundaries to serve forecast demand. The Northern Ireland authorities should be prepared to review the planning agreement affecting traffic volumes and operational hours at Belfast City airport. They will also want to consider with the Irish Government the future of the City of Derry airport.

In Wales, in conjunction with the Welsh Assembly Government, we have concluded that Cardiff should remain the main airport for south Wales. It has experienced rapid growth, and extra terminal capacity will be needed as well as measures to improve access to the airport by both road and public transport. We also want to see the development of centres of excellence for aircraft maintenance work both in south Wales and the west of Scotland, as well as in the north-east of England and elsewhere.

We received proposals for a new airport in south-east Wales, but we have concluded, for the reasons set out in the White Paper, that they would not be viable. Instead, we prefer to see development at Cardiff and Bristol. Domestic air services make a major contribution to economic development, so the Welsh Assembly Government are to consider new internal services within Wales, potentially supported by public service obligations. They are also looking at setting up a route development fund, similar to the one operated by the Scottish Executive, which could support new services from Wales. We are asking some English regional development agencies to consider similar funds for regional airports.

Because services to London airports, particularly Heathrow and Gatwick, are so important to Northern Ireland, Scotland and the south-west and north of England, we are setting out proposals for imposing public service obligations in well-defined circumstances, to protect landing slots for services that are vital to the continued economic development and prosperity of those areas.

In Scotland, we and the Scottish Executive anticipate that additional runway capacity will be needed in the central belt, probably around 2020, so we propose to safeguard land at Edinburgh for a second runway, together with the associated expansion of terminal buildings. We also recommend that consideration be given to protecting land at Glasgow for a possible new runway; and we also support safeguarding land for terminal expansion. The Scottish Executive have published plans to improve surface access to both Glasgow and Edinburgh airports. The White Paper also

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sets out proposals that would allow for continued growth at Aberdeen, Prestwick and Inverness. We see no case for a new airport in central Scotland.

In the north of England, we support the development of additional terminal capacity at Manchester, provided that the noise impacts from increased use of the airport are rigorously controlled. We agree that the airport at Liverpool should expand as projected and the runway be lengthened in the future, subject to the conditions set out in the White Paper. We also support plans for expansion of terminal facilities and runway extensions at Newcastle, Teesside and Leeds-Bradford.

In the midlands, we consulted on the option of a new airport to be built between Coventry and Rugby. I can tell the House that, for reasons set out in the White Paper, we do not support developing that new airport. The Government believe that we should make the best use of existing airport facilities and support the growth of existing regional airports, given their importance to economic development and prosperity. Birmingham airport provides an important regional base for a number of airlines and has an expanding long-haul market. Traffic is set to grow, and we support the case for a second runway at Birmingham, to be built probably around 2016, subject to stringent limits on noise.

East Midlands airport is the third largest freight airport in the United Kingdom and is rapidly establishing itself as the largest dedicated freight airport. We therefore support the projected expansion of both passenger and freight traffic at East Midlands airport. We see no need for a second runway at East Midlands, but we will keep it under review in the light of growth in freight and passenger traffic at the airport. As with other airports, we have set out proposals to establish stringent noise controls and to provide mitigation and compensation in relation to noise, and also to deal with blight.

In the south-west, we support the development of Bristol International airport, including a runway extension and new terminal when needed. However, we do not support the option of a new airport north of Bristol. We also anticipate the need for development of more terminal facilities at Bournemouth, as well as future development at Exeter and Newquay.

In Plymouth, the options, including the case for a new airport east of the city, need to be explored further by the local and regional authorities. Proposals for development at a number of smaller airports throughout the country are also dealt with in the White Paper.

I now turn to the south-east of England. The issue of airport capacity in the south-east is significant for the whole of the country. Although the vast majority of travellers using the main London airports are travelling to or from the south-east, the whole of the United Kingdom depends on the range and frequency of services from those airports.

The pressure on existing capacity is already more severe in the south-east than in the rest of the country. At the same time, it is the most densely populated part of the UK. As a result, the pressures from competing land uses and the likelihood of airport growth affecting people are greater too.

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Therefore, we must strike a balance between the undoubted importance to future prosperity and the local environmental impact of development. Again, our first priority is to make the best possible use of existing runways that will provide some much needed capacity. That is why we support proposals to make best use of the existing runways, including development to make the maximum use of a full-length single runway at Luton. However, this will not be enough to meet the pressure that will arise over the next 30 years.

In line with the balanced approach that I have already set out, the Government believe that, over the next 30 years, there should be two new runways in the south-east. The first new runway will need to be completed within a decade, but work also needs to start on planning for a second runway, to be built probably around 2015 to 2020.

I shall now set out our conclusions. First, we consulted on the possibility of building a new airport at Cliffe. I have concluded, taking all relevant factors into account, that we do not support an airport there.

Stansted has seen very substantial growth in passengers in recent years. This year, it is expected to handle nearly 19 million passengers, compared with fewer than 7 million only five years ago. Despite that growth, the number of people significantly affected by noise fell by 70 per cent. between 1998 and 2002. There is likely to continue to be strong growth in demand at Stansted and, at current rates of growth, its runway capacity would be used up within a few years. A second runway at Stansted would provide very substantial runway capacity in the south-east, and generate large economic benefits. However, like any such development, it would have significant local environmental consequences.

The local economy is already set to grow strongly. We believe that the Government's objectives for regional economic development would be complemented by an expansion of Stansted. On balance, we have therefore concluded that the first new runway in the south-east should be developed as soon as possible at Stansted airport, expected to be opening around 2011 or 2012. Surface access will need to be improved and, of course, there will need to be strict environmental controls as set out in the White Paper.

Heathrow is the UK's major hub airport. It competes primarily with major continental airports such as Amsterdam, Frankfurt and Paris. It enables London and the south-east to compete for investment and growth. In addition, London has one of the strongest local catchment areas for international air travel in the world, especially in the finance and business services sector, which rely on global markets and good international communications. Moreover, Heathrow directly or indirectly supports nearly 100,000 jobs. It is a prime driver of the west London and the Thames valley economy.

Without additional capacity, Heathrow's route network will tend to reduce over time, most likely to the advantage of other international hub airports in northern Europe. There is, therefore, a strong economic case for securing the large economic benefits through the addition of a new runway at Heathrow. However, at the same time, that has to be balanced against the substantial environmental impacts at Heathrow.

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Although today's jets are 75 per cent. quieter than in the 1960s, and although the number of people affected by severe noise has reduced over the years, noise impacts at Heathrow are many times worse than at other UK airports. The most difficult issue confronting expansion at Heathrow concerns how to ensure that air quality nearby is kept at acceptable levels, and to achieve compliance with the mandatory air quality limits for nitrogen dioxide that will apply from 2010.

That is why we said last year that development at Heathrow could be considered only if the Government were confident that levels of all relevant pollutants could be consistently contained within EU limits. Having considered all these matters, the Government have concluded that there is a strong case for a third runway at Heathrow, once we can be confident that that key condition in relation to compliance with air quality limits can be met. We judge that there is a substantially better prospect of achieving that condition in the 2015–20 period, provided that we take action now to tackle the nitrogen dioxide problem, which is work that should be done in any event.

Our support is also conditional on measures to ensure that the total area within the 57 dB noise contour should not increase from last year, as well as on improvements to surface access. We will therefore institute immediately with the airport operator, and relevant bodies and agencies, a programme of action to consider how those conditions can be met to enable the addition of a third runway. For the meantime, the White Paper sets out proposals to work up measures to increase capacity at Heathrow using its existing runways, subject to further consultation and strict environmental controls.

At Gatwick, the Government will not seek to overturn the legal agreement that prevented the construction of a second runway there before 2019. However, land will continue to be safeguarded for possible further development at Gatwick in case the conditions attached to a runway at Heathrow cannot be met. The White Paper also sets out stringent environmental conditions that we expect operators to meet and other proposals to limit and mitigate the impacts that aviation has on the environment, including its impact on global warming.

We are setting out proposals for the development of air transport for a generation. It is essential that we plan ahead now: our future prosperity depends on it. The policies set out in the White Paper will support economic prosperity throughout the United Kingdom; will enable people to make flights at reasonable costs; and will control and mitigate the environmental impacts of aviation. I commend this statement to the House.

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