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Northern Ireland, because of its peripheral geographic location, is particularly reliant on good air links to help it maintain and develop a healthy economy, and to play its full part in an enlarged Europe. Over the past decade, global changes and pressures on the airline industry resulted in a decline in services to and from Northern Ireland. By the end of 2003 Northern Ireland had only one remaining direct air link to mainland Europe.
More recently in Europe the emergence of low cost airlines and the drive by airports to secure new air links have helped to bring about a revival. Over the last year significant improvements have taken place and Northern Ireland is now generally well served with links to the rest of the United Kingdom. Routes to a number of European centres have also been established, and the first transatlantic service since 2001 is due to commence shortly. However, there is still potential for expansion of scheduled services, particularly to other important European centres and to more North American destinations.
Good access to Heathrow, with its onward global connections, remains crucial for Northern Ireland. While we were reassured that there is no immediate threat to the current service, the continuing pressure on landing and take-off slots at Heathrow, which is likely to increase in the absence of additional capacity being made available, means that there is little room for complacency. The Government needs to have adequate contingency plans in place to protect this service.
Dublin airport, because of its proximity and improving road links, is an attractive option for many Northern Ireland travellers as it offers a wide range of direct services often at lower fares than a service to the same destination operated from Belfast. While this may be beneficial from a consumer perspective, recapturing some of this market could provide valuable economic benefits for Northern Ireland. In the absence of any definitive information on the numbers or the factors that influence people to choose to fly through Dublin rather than from Belfast, it is impossible to quantify the beneficial impact of any measures that may be introduced.
We believe that the Government White Paper on Aviation provides a sound basis for the development of air services generally in Northern Ireland over the coming years. However, to enable this to happen two important issues need to be addressed:
· First, a decision on the review of the Planning Agreement at the Belfast City Airport is needed urgently. This will determine the scope for the airport to grow and develop. Careful consideration needs to be given to the environmental aspects of this issue; and,
· Second, the decision in principle by the two Governments to provide funding to develop the City of Derry airport is welcomed and must be finalised as quickly as possible. Again, careful consideration needs to be given to the potential impact on those who live near the airport. Important decisions on the future governance of the airport are also needed.
The Route Development Fund, which was set up in September 2003 to promote new air routes of economic benefit to Northern Ireland, represents a valuable Government initiative at a time when air services to Northern Ireland were very poor. Although it has resulted in some important new routes, a large number of routes have been announced in the same period which will not receive support. Inadequate advance preparation and research, to identify priority routes offering the maximum business or inbound tourism potential, has meant that funding has been awarded in an ad-hoc and disorganised way, and the full potential benefits for Northern Ireland may not have been realised. A Route Development Fund, which has had a relatively high failure rate of funded routes, was introduced in Scotland in 2002. This experience should have sounded a note of caution and underlined the need for a rigorous and focused approach.
Other regions of the UK are considering similar initiatives and we have serious concerns that the proliferation of Route Development Funding could distort the market and reduce the overall effectiveness of such support. It is imperative, therefore, that a thorough, robust, and independent review be undertaken before any further funding is provided for the Northern Ireland scheme.
The considerable growth in air services generally throughout Europe recently, mainly through the advent of low-cost airlines, has been reflected in significant improvements in services to and from Northern Ireland. However, we recognise the susceptibility of airline travel to global events and there is no room for complacency. The planned review next year of the strategic framework for the whole United Kingdom, set out in the White Paper, will be a valuable opportunity to reassess Northern Ireland's performance.
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