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UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 809-iv House of COMMONS MINUTES OF EVIDENCE TAKEN BEFORE TRANSPORT COMMITTEE
THE WORK OF THE CIVIL AVIATION AUTHORITY
Wednesday 1 February 2006 MR PAUL HAMBLIN, MR LONEK WOJTULEWICZ and COUNCILLOR RUTH CADBURY MS KAREN BUCK MP and MR DAVID McMILLAN Evidence heard in Public Questions 533 - 682
USE OF THE TRANSCRIPT
Oral Evidence Taken before the Transport Committee on Wednesday 1 February 2006 Members present Mrs Gwyneth Dunwoody, in the Chair Mr Jeffrey M Donaldson Clive Efford Mrs Louise Ellman Mr Robert Goodwill Mr John Leech Mr Lee Scott Graham Stringer Mr David Wilshire ________________
Memoranda submitted by Campaign to Protect Rural England, Leicestershire County Council and the London Borough of Hounslow
Examination of Witnesses
Witnesses: Mr Paul Hamblin, Head of Policy (Transport and Natural Resources), Mr Lonek Wojtulewicz, Head of Planning, Leicestershire County Council, and Councillor Ruth Cadbury, Executive Lead - Aviation Issues, gave evidence. Chairman: I begin with some housekeeping and Members of Parliament having an interest to declare. Clive Efford: Member of the Transport and General Workers Union. Graham Stringer: Member of Amicus. Chairman: Member of ASLEF. Mrs Ellman: Member of the Transport and General Workers' Union. Q533 Chairman: Those of you who have given evidence before will know that the House of Commons does rather sacrifice status for straightforward acoustics, so please speak up. May I ask you first to identify yourselves? Mr Hamblin: I am Paul Hamblin. I am Head of Transport and Natural Resources at CPRE. Mr Wojtulewicz: I am Lonek Wojtulewicz, and I am an officer of Leicestershire County Council, Head of the Planning Section. Cllr Cadbury: I am Councillor Ruth Cadbury, lead member on the Council's Executive on aviation issues at the London Borough of Hounslow. Q534 Chairman: Did any of you have anything you wanted to say briefly before we begin? Cllr Cadbury: As the lead councillor at Hounslow on aviation issues, I represent a deprived urban community next to Heathrow, and I pass maps around. Whilst many residents are economically dependent on the airport, nearly 250,000 people in West London live within the 57 dB contour, which WHO defines as the onset of serious noise. Flight numbers have doubled in about 20 years and our community suffers from night flight noise, disrupted education, air pollution and traffic congestion, yet there are minimal mitigation measures that benefit our community. We believe there should be fully funded mission mitigation measures. Your inquiry into the work of the CAA is most welcome as it allows us to comment on the weaknesses in the current regulatory regime. The CAA currently has a statutory responsibility for the safety and health of the aviation community but it does not have a clear role to regulate noise. We believe the CAA should extend its remit to include the impact of aviation on the wider population, particularly those living next to airports. Q535 Chairman: Thank you. That is an interesting point. Mr Hamblin, you actually said in your evidence that you thought the CAA remit ought to be changed to take account of the Government's Sustainable Development Strategy. What kind of changes, extra powers, should they have? Mr Hamblin: Indeed we did. We believe that the current duties which the CAA has do not address the environmental issues. To quote the Chairman of the CAA before the committee when he appeared, the CAA has limited responsibilities in relation to the environment. We would advocate a duty to promote environmentally sustainable development, a duty which is in keeping with the Government's Sustainable Development Strategy. Q536 Chairman: Mr Wojtulewicz, did you want to comment on that? Mr Wojtulewicz: Yes, thank you, Chairman. Leicestershire County Council's experience is limited to its experience with the East Midlands Airport and the recent changes in controlled airspace over Leicester, which the CAA approved last year. I would like to echo what has been said. Yes, I think the CAA should have a duty put upon it more specifically to take account of environmental matters. In particular, in considering the planning system, if there is a proposed development at an airport, the planning authority will take into account environmental impact, but, when there is no physical development, it does not require planning permission such as changes to controlled airspace, and then the environmental remit is left to the CAA. We would like to see that having more parity with other matters. Q537 Chairman: You have all made this point now that the CAA has a statutory obligation to ensure that public demand for air transport is satisfied at the lowest cost consistent with good safety. Do you think possibly it is unrealistic to expect them to do the sort of environmental policeman act at the same time? Is it not better to have a separate body to deal with environmental regulation for aviation? Cllr Cadbury: I started off thinking that I was agnostic about whether the CAA should do this or whether this should be taken up by another body. I have just looked at the Federal Aviation Authority website. The FAA in the United States has a major role on environmental issues and also funds significant mitigation packages that benefit residents around airports in the US. The figure is about $1.9 million. Q538 Mr Goodwill: Would you consider the role of the CAA to be as sort of judge and jury, with the CAA arbitrating on these additional environmental burdens placed upon a particular community, or would we be embarking on yet more public inquiries and a planning-type process administered by the CAA? Mr Wojtulewicz: That is an option that I have thought about and one which is a possibility, but if you have a separate body dealing with environmental issues, then who will be the final arbiter? I think that is the key issue. If that remains with the CAA, it may be difficult for the CAA to wrestle with these issues, but nevertheless they have a specific duty to take them into account and they will remain the arbiter of it. It will be difficult. The issue about a potential public inquiry is something that again is a potential. If matters remain unresolved in some way, then a public inquiry may be one way of doing it, given that many local people, particularly in Leicestershire, feel a little bit disenfranchised from the process. Q539 Chairman: Do you disagree with that, Mr Hamblin? Mr Hamblin: I do not disagree. I wanted to make a further point, which is that there is a potential conflict between safety, economic regulation and environmental impact, too. Having multiple agencies trying to deal with that I do not think is a way forward to resolve those conflicts. Those potential conflicts are still going to exist, but it is much more likely that they can be resolved with a single regulator. Q540 Chairman: What are you saying? Is it that automatically safety is going to clash with the environmental needs of a particular airport? Mr Hamblin: I am not saying that they automatically clash, no. Technological improvements and changes to flight paths can provide safety and environmental benefits, but at the moment we have a regulator which is primarily an economic and safety regulator. Really, our perspective is that, given the framework within which it is working where it has the Government Transport White Paper, which is saying, "Let us expand", where it has guidance that says, "Avoid aircraft over densely populated areas but also protect tranquilly", there are real problems in trying to meet all of those three. Part of that lies with the framework within which it is working. In the Air Transport White Paper, which we believe should be reviewed, we believe that the CAA has a key role in providing information back to the policymakers about the environmental limits which are being breached. Q541 Mrs Ellman: It has been suggested to us that environmental issues should be decided very locally and internationally, but not nationally. Do you have any views on that? Cllr Cadbury: There is a range of appropriate measures. If we had national policy, and we already have international policy, set around, for instance, noise levels in WHO models, that would set the policy framework and the regulatory regime could work within that. Could I pick up the point on the public inquiry? We do not believe a public inquiry is the place to sort out these issues. From our experience of Terminal 5, it is very expensive and very lengthy. For a borough like Hounslow, which is not the planning authority, we got no benefit from the outcome of a public inquiry. Q542 Chairman: You are not saying you should not have a public inquiry unless you feel they come up with the answers you want, are you? Cllr Cadbury: No, but in terms of dealing with the regulatory regime for noise and emissions and so on, a public inquiry is not necessarily the place to set those. A proper regulatory regime that is able to be implemented nationally is what is needed. Mr Hamblin: May I just add from the CPRE's perspective that we believe that addressing environmental concerns needs to be integrated from a European and indeed international effort - European, national, regional and local. If we have inconsistency between those levels, then we are going to run into problems. We have experienced the Air Transport White Paper and the only comment it makes on the tranquillity of the countryside is that its loss will be in some ways inevitable. That creates real problems when you are trying to address those issues at a local level, if that is the framework within which you are working. Q543 Mrs Ellman: How well do you say the CAA balances economic and environmental concerns? Mr Wojtulewicz: From what I have seen, and obviously they say they take into account environmental considerations in balancing them, I think their priorities still remain with safety and economic issues. I think more weight should be given to environmental considerations and the CAA should be given that duty to give it more weight. Q544 Mr Leech: If you think they do not put enough weight on environmental considerations, I do not quite understand how that marries up with you all suggesting that the CAA should have a specific role in environmental considerations and that that it should be a separate organisation that is looking at the environmental side. Mr Wojtulewicz: At the moment, they look at it but the weight they give to it is probably very little, or less than perhaps other safety and economic issues. That might well be what the Government wants and what they should be doing. Safety is important but I think the balance needs to be fine-tuned a little to give a bit more balance on the environmental issues. Cllr Cadbury: The CAA has environmental aspirations but it has very little detail and it has no regulatory regime to back up those regulations. It is working in a policy context which itself is very weak on environmental considerations. The Aviation White Paper made some small remarks about the environment but it did very little. For instance, it said nothing about noise insulation in homes, and so the whole policy context is very weak on the environment in the Aviation White Paper. Q545 Mr Wilshire: For the purpose of the question I want to ask you, can we agree that we all want greater environmental concern about this? This is the basis on which we will work for the moment. If that is what we want, is there not a danger that if you give it to the CAA to do that, you are inviting them to give greater weight to environmental issues at the risk of them giving less weight to safety? If that is so, above all else from my perspective nothing must undermine their safety considerations. Therefore, is not another body charged with what you want the best way of ensuring that the CAA does what it is supposed to do and that the environment is considered more by somebody else? Mr Hamblin: I do not think there is a contradiction in what we are saying. Certainly from the CPRE's perspective, the CAA's commitment to safety is paramount; it is enshrined in the Transport Act. We do not see a need to change that. However, there is an awful lot which can be achieved once one has taken into account safety in terms of environmental improvement and reducing the environmental impact. We believe that is not being done. To use an example, the South-West Airspace Consultation generated a significant response from councils, members of the public and other bodies. The CAA, in examining those responses it received, frequently said it was not within its remit and it was not within its objectives to look at that particular issue. Therefore, that is where we see a real weakness. Q546 Chairman: Do you want to add to that, Councillor Cadbury? Cllr Cadbury: Yes. I refer back to the Federal Aviation Authority model in the United States, which is hardly restrictive to the growth of aviation and yet has, as I said before, a very strong regulatory environment regime and a very generous series of mitigation packages. Q547 Chairman: In comparative terms, as the committee will tell you, they are rich runs in rather concentrated areas, are they not? Their interest frequently will mean, for example, and I do not want to traduce them, that they would accept a rural airport in an area which would not be acceptable in this country because of the different terms of reference under which they operate? Cllr Cadbury: I do not know enough about the detail but certainly they seem to have quite strong rules for major built-up areas. We believe it is worth pursuing more. One example where safety does take precedence over the environment is that there is little regulation on noise of departing aircraft because safety has to take precedence there, and we accept that. Q548 Mrs Ellman: The evidence from Hounslow suggests that the CAA is taking sufficient regard of the local environmental impact. Are you saying that the decisions are wrong or that they are not showing how they got to that? Cllr Cadbury: It is not within their remit. They have no need to take an interest because their remit does not include local aviation issues. Q549 Mrs Ellman: You are asking for the CAA to publish local mitigation issues? Cllr Cadbury: No, we are asking for a much stronger regulatory regime which allows for generous mitigation packages. It seems appropriate, as the CAA is already an aviation regulator, that that might well be the place to do it. We are starting from the fact that the mitigation packages we get are small, inadequate and generally voluntary, and we believe they should be the opposite. Q550 Mr Wilshire: Can you not see the risk that if you tell the CAA that they have got to fund mitigation packages, that has a financial price tag attached to it? Would you not be concerned that there is a danger that they will compromise safety to keep the cost of mitigation down? This is not an argument against doing it. It is an argument against the safety regulator doing it. Cllr Cadbury: I do not believe the two are contradictory. Q551 Mrs Ellman: The evidence from Leicestershire suggests that you are not content with the current consultation arrangements on airspace. What would you like to see changed? Mr Wojtulewicz: At the moment, from our experience at Leicestershire and the East Midlands Airport in particular, all the consultation was done by the airport operator themselves. They collected the evidence from the consultation process and they handed it over to the CAA as part of their request to expand the airspace. The CAA looked at it and I think they commissioned their own environmental analysis, which was not revealed to anybody, but they came to a view that the airspace would go ahead and they felt there were environmental benefits. Perhaps it would be helpful if the CAA were a bit more transparent and explicit in their reasoning about why they did that and what way they looked at those factors. Our experience was that we did not really have an opportunity to question them very closely on that. Q552 Mrs Ellman: You want there to be a statutory obligation to consult with local authorities. You feel that local authorities are ignored then? Mr Wojtulewicz: I am just going by our experience. There was one round of consultations which did miss out a lot of local elected bodies. The airport had to do it again, I think from advice from the CAA. I would welcome a more statutory requirement for them to consult to ensure that those who represent people affected by the airport have their proper say. Mr Hamblin: To follow on from that point, it is extremely important how one defines who is going to be affected by an airport and flight path. One of the concerns the CPRE has is that at the moment the definition is obviously where the aircraft are going to be flying sufficient low or whether they are flying over an area of outstanding natural beauty or a national park. I would ask of all the constituencies that you represent what proportions are designated as national parks or AONBs, and yet, surely, there are many people in communities within your constituencies who are very concerned about protecting peace and quiet and tranquillity. So we think that is an artificial way of delineating whether one should consult or not and that that perhaps should be re-examined by both the CAA and by the Department for Transport. Q553 Mrs Ellman: Is there a danger, though, that the consultation procedure will become unduly long and unduly complex? Mr Wojtulewicz: I do not think so. I think in natural justice people who will be affected or are potentially affected ought to have a right to be consulted on matters that may affect them, particularly if there are changes that are, say, outside the planning system, as I mentioned previously, and changes which are purely in the remit of the CAA. I think there has to be some kind of way to engage the community and show that justice is seen to be done and is done. Cllr Cadbury: In slight deference to Mr Hamblin's perspective, we are speaking from the perspective of a large urban community that has been next to the airport for over 50 years and is seldom consulted when we are faced with an incremental increase in flights. Another example is that in the drafting of the White Paper we were not consulted on the detail, which we would have been had we been asked about, for instance, the Community Buildings Noise Insulation Scheme which, as I said before, was completely inadequate. This is the kind of example of the Department for Transport and the CAA not considering local authorities to be relevant or appropriate. We find that unfortunate. Q554 Chairman: Is there not a fine line to be drawn between what is a legitimate involvement with the local authority, which must protect schools and those areas of residences where people have the right to enjoy proper quiet and their own homes, and the sort of complicated involvement in the expansion of a particular airport? Is there not a delicate line that needs to be drawn between consultation with the local authority and the right to interfere in, for example, the process of airspace changes, which would give local authorities an extra right to hold up the process, which is already fairly complicated? Cllr Cadbury: I would suggest that, for instance, we are about to face a consultation on the loss of runway alternation with the introduction of mixed mode as a way of expanding Heathrow within the context of the current two runways. That will make a major change to the quality of life for residents in West London who currently have peace and quiet before 3 p.m. or after 3 p.m., or from the perspective of schools which generally are closed after 3.30, and they have a week of noise and a week of quiet. Clearly, that is going to make a major change in people's quality of life. I think that I as a local authority representative have every right to make major submission on that issue. Q555 Mr Donaldson: Can I ask Mr Hamblin: in what way is the CAA's Sustainable Development and Aviation Environmental Policy Statement unambitious and what would you like to see in it? Mr Hamblin: I think it is unambitious both in terms of its aspirations and in terms of how it is implemented. This goes back to the discussion that we were having earlier about the framework within which the CAA operates. The 57 dBA limit has been used as the threshold for community annoyance. Information from the World Health Organisation, which has looked at this, has shown that that limit is high or the threshold is high and that it should be lowered, for example, to 50 dBA. It has not looked at the impact of aircraft in tranquil environments. The last research which it has done is over 20 years old, so it needs to be refreshed to ensure that it is looking at environmental factors in the context of the sustainable development strategy which has as one of its five principles living within environmental limits. The policy statement was written a number of years ago. It is important that it keeps up to date with the process on environmental policy. Q556 Mr Donaldson: The Environment Research and Consultancy Department at the CAA exists in part to provide technical advice and guidance to local planning authorities. What is your relationship with them and how much help are they, particularly the two councils? Mr Wojtulewicz: The county council actually has no planning remit or locus in determining anything to do with the airport. The county council has become involved with the general governance issue because its constituencies have been pressing them to see what we can do to help them mitigate the effects of the airport. I cannot really help you on that particular guidance. Cllr Cadbury: We have had virtually no contact with the Civil Aviation Authority, and in fact we have had to ask them for their recent consultation documents. I can see it in the context of their remit and their core regulatory powers. Yes, you are right: they do have some staff working on environmental issues, but I would say, looking at their business model, that it is not part of their core business. Q557 Mr Donaldson: If the Environmental Research and Consultancy Department were cut back or indeed responsibility passed to Europe, what, if any, would be the consequences for local authorities? Cllr Cadbury: If the CAA is to lose some powers to Europe, I would suggest that it gives its additional scope to reallocate those staff, that resource, to the kinds of things that we are suggesting should be done. I think there is an opportunity there for the CAA to boost its role on environmental and sustainability issues and its regulatory framework. Q558 Mr Donaldson: You would welcome a closer liaison between your council and the CAA? Cllr Cadbury: I would welcome a closer relationship between us and the CAA and us and the Department for Transport, yes. Q559 Graham Stringer: I would like to ask Mr Wojtulewicz this. I understand your points about consultation. What I am not sure about is what the actual problem is at the end of the consultation. If you were not consulted, I understand your complaint. What is the complaint about the decision the CAA came to? Mr Wojtulewicz: We have to accept the decision that they came to because that was their role. What we would like to see is a bit more transparency in how they came to that view, what weight they gave to particular factors, and what weight they gave to our views or other views. Q560 Graham Stringer: It is a process issue then. You are quite happy with the outcome at the end of it? Mr Wojtulewicz: I do not think the council is happy with the outcome but it would have helped if we had more transparency and more explanation about why they came to their view and what weight they gave to our views. Q561 Graham Stringer: What is the council not happy about? We are finding it difficult to get there, are we not? Mr Wojtulewicz: What the council is not happy about is that the amount of controlled airspace over Leicestershire has now doubled and there are more people affected by air transport than previously. Q562 Graham Stringer: We visited the CAA at the end of last year and they told us that there were fewer people affected by the airspace changes than previously. Mr Wojtulewicz: I think this is where the problem with the county council comes in. The airspace changes covered Leicestershire, Derbyshire and Nottinghamshire. Within that area they said that overall between those three counties there were fewer people, but in Leicestershire there were more people affected. There were fewer in other places but Leicestershire bore the brunt of it. Q563 Graham Stringer: So it is a NIMBY issue and that Leicestershire people should not be disturbed so that there is a greater benefit overall in the Midlands. Is that the issue? Mr Wojtulewicz: That is always a problem, that the benefits of airports are spread wide but the disbenefits are felt locally. Clearly, the council is concerned about what its constituents are telling it. Q564 Graham Stringer: Is there also a change in the number of people in rural areas affected compared to the number of people in urban areas? Mr Wojtulewicz: In Leicestershire, I believe there are more people in rural areas affected. Q565 Graham Stringer: And fewer in urban areas? Mr Wojtulewicz: I am not sure what the balance is. There were not that many urban areas overflown previously, but there were some. Q566 Graham Stringer: Do you accept that overall in the Midlands fewer people are now affected by aircraft noise? Mr Wojtulewicz: I have not seen that data but if that what the CAA tell us, I have to accept that. All I can say is that Leicestershire took the worst position. Q567 Graham Stringer: Could I ask CPRE: it seems to me, from your evidence, that your real problem is that you are fundamentally opposed to the Civil Aviation Authority's remit. Do you have a view as to what the total level of aviation should be in this country, either in number of flights or number of passengers? Should that be reduced, increased or stay the same? Mr Hamblin: Perhaps, first, I can put on record that we do not have a problem with the CAA existing as a safety and economic regulator. We do have concerns that it is not looking at the issue in terms of the framework of sustainable development. Q568 Graham Stringer: It was its remit that I mentioned particularly and not its existence. To be clear, its remit is to make sure that there is enough capacity to satisfy the demand for air travel. Mr Hamblin: I have some sympathy with the Civil Aviation Authority that is trying to address how to distribute increasing environmental damage. Do you locate it in over‑populated areas - and clearly that would be unacceptable - or do you spread it out over tranquil areas of countryside? CPRE believes that the tranquillity of the countryside is part of its defining characteristics; that is what makes it different to urban areas. The Government, in its Rural White Paper, said that it wanted to have policies to protect it, and indeed it has given guidance to the CAA on that particular point, and so I have some sympathy with the CAA in terms of how they wrestle with this problem. At the end of the day, what they are doing is looking at mitigation measures. We believe the key solutions lie in trying to avoid the impact by tackling the overall growth in air traffic. That is why, as we have discussed on previous occasions, CPRE has advocated an air transport policy which is based on demand management at the start. With growing evidence, almost by the day, about the impacts of climate change, in addition to the effects associated with noise, the strength of the argument about the need for a demand management policy grows. Q569 Graham Stringer: Can you answer this question? Do you want the number of people travelling by air to reduce, stay the same or increase and, if to increase, by what rate? Mr Hamblin: I cannot answer by what particular rate. We have done work with the Department for Transport looking at their forecasting model which said that if you were to put a tax on aviation fuel and VAT on the industry, which is currently exempt, then the forecast growth would decline considerably and to an extent that it could be met within existing infrastructure. That would still see an increase in the number or flights, but it would be significantly less than is currently forecast as being provided for in terms of the policies in the Air Transport White Paper. Q570 Graham Stringer: To go back to the answer you gave to the question originally, you are saying, are you, in plain English that you prefer that the noise from aviation is taken by more people living in urban areas rather than by people living in rural areas? Mr Hamblin: I am saying that the CAA, local authorities and other interested groups are being told: you have a choice; either you can have noise over urban areas or the countryside. The solution lies not in responding to that one way or another but in actually tackling the heart of the problem, which is the increasing level of air traffic. Q571 Graham Stringer: You have just said that you believe that there should be an increase in air traffic but not at the rate envisaged in the White Paper. What I am asking is this: in that scenario, where does CPRE believe those airplanes should fly over? Should they be flying over countryside or should they be flying over urban areas where there is a choice, because there would be a choice? Mr Hamblin: I think at the moment we are not in a position where we can properly evaluate what the impact will be over rural areas because of the way noise is measured, failure of information --- Q572 Chairman: I am sorry, Mr Hamlin, but you are wriggling a bit. You are asked a very straightforward question to which we do expect a fairly straightforward answer. It is very simple. You posed the conundrum, so what is your view? Given the fact that life is inadequate, government departments do not give you all the details you want, that the sun rises and sets, could you just tell us what your view is? Mr Hamblin: If we had full information, if we had a policy which was focused on demand management, which reduced the overall pressure, then the CAA needs to come to a judgment about that one way or another. Q573 Chairman: We know about the CAA. We are asking you, Mr Hamblin: what is the view of the CPRE? It is a perfectly fair point. If there is a choice between rural areas and more people suffering more in Hounslow, what is your decision? Mr Hamblin: We would want to see the overall policy focused on demand management. Of the aircraft which are then flying, clearly you would want to reduce the impact on the human population, and that means not flying over urban areas, but there is a significant downside which currently is not being addressed in the policy debate. That is the impact on tranquil areas and the countryside for those in urban areas to visit and enjoy as much as those in the countryside. Chairman: I think that means urban areas by any other name. Q574 Graham Stringer: I shall read the transcript with interest. As a final point, you have used the word "sustainability" a good deal. Can you define that for us, please? Mr Hamblin: We have a position statement, which I would be very happy to submit to the committee, if you would like. If you are looking for a definition now, then I would say: the Government's Sustainable Development Strategy that is looking at improving the quality of life for people now and in the future, by promoting economic prosperity rather than growth, and living within environmental limits. Q575 Graham Stringer: This is a final question to Cllr Cadbury. You said in response to the Government's consultation that you were restricted in some way from providing an input into that consultation. I thought it was an open consultation and that you could say anything you wanted to before the White Paper was produced. Cllr Cadbury: Thank you for letting me clarify that. The consultation was quite open. When the White Paper came out, there was a general statement recognising, I think for the first time by the Department for Transport, the needs of residents and the communities near airports, and that was to be welcomed. The detail of that came out as a series of schemes, some of which applied to Runway 3, the purchasing of lights for the Runway 3 area in Hillingdon, but the two other areas related to community noise insulation and people living in the very noisiest area, the 69 contour. Those were fairly strange. We would have been more than happy to be called in to the Department for Transport to talk about the detail of them before they had been finalised. I do not have the detail. For community buildings, schools mainly, that is inadequate and it is discretionary. We have standards in this country set by the DfES with Building Bulletins for acoustic standards and ventilation standards; i.e. what classrooms should experience in terms of external noise and ventilation. Those were not used by the Department for Transport. When we spoke to the DfT officials, they were not even aware of them. The scheme merely provides double glazing; it does not provide for any ventilation. It only works in classrooms and not other rooms in the schools. It does not address mobile classrooms and, because our schools are successful and growing, several have mobile classrooms. The scheme will not be able to include mobile classrooms. For the insulation of homes, we have said for many years that the existing scheme is inadequate both in terms of how big an area it covers and also what it covers. It only provides half the cost of double glazing; householders are expected to pay the other half of the cost. It only covers the 6,000 or so homes in the 69 contour. We say it should probably go out to the 65 to 63 contours, as in other areas, and I believe possibly Manchester Airport itself. The White Paper said nothing about noise insulation at all. It allowed for a grant for a home owner to be given up to £10,000 to help him sell his house and move away, but somebody else would be coming to live there. The house would not be bought by BAA. Really, that does not help the existing residents who decide to remain in that area. We believe that if they are going to spend that kind of money, they should have provided a proper insulation scheme. This is detail on which, if they had talked to us while they were drafting the White Paper, we could probably have given them some relevant local advice. Q576 Clive Efford: Following on from that, you have suggested that the CAA should have powers to impose sanctions on airlines and airports that fail to fulfil any mitigation targets. Can you describe for us very briefly the scope of the mitigation that you are seeing? You are suggesting that mitigation should be implemented in order to reduce environmental impact by airports and by airlines. What is the scope of what you are looking for, how would it be implemented, and what sort of things are you looking for? Cllr Cadbury: There is a range of opportunities to fund through some sort of levy or range of levies. The sources of funding for mitigation in the FAA scheme are quite varied. They include tax on tyres, on passengers, on tickets, on the airlines themselves and on the airports as well, as part of the FAA's core funding. It is quite a mixed scheme which does not therefore restrict aviation in that sense. We are not saying what sort of levy it should be but that there should be a levy in order to fund adequate mitigation. It is only fair that the mitigation for the impact of aviation on local communities should come from aviation in some form, but I am not suggesting any particular route that it should take. Q577 Clive Efford: I will ask one last question as we are short of time. You have argued very strongly that the CAA should be responsible for environmental matters in relation to the air industry. Do you have any concerns or comments about any conflicts of interest the CAA may have, given that it is funded by the industry? Do you think it is the most appropriate body for that? Cllr Cadbury: I do not think in this country we have an alternative at the moment that I can see. I agree there could be a danger, but they are already regulating the aviation industry. Possibly there is a lack of anything else. Q578 Clive Efford: You are seeking to impose costs on the industry? Cllr Cadbury: Yes. I think that is reasonable. Mr Wojtulewicz: I would generally agree with that point. While it might be difficult for the CAA to balance its own decisions, it needs to have that environmental duty. If there is a cost, then there is a cost. Q579 Chairman: Mr Hamblin, you said the CAA needs to be more sophisticated in feeding information to the Government. What do you mean? Mr Hamblin: Much of the discussion on the Air Transport White Paper and the consultation around that was based on ground-based infrastructure. It was not really looking at the overall implications for the management of airspace. Certainly, anybody responding to the consultation paper would find it extremely difficult to feed into that debate, not least because, as the committee has heard from the CAA itself, work is still ongoing to feed into the Department for Transport on that. That sort of information should have been made available earlier. The sophistication that we are looking for is in relation to low thresholds for community annoyance and not simply designated areas as a proxy for sensitive environmental areas. Q580 Mr Wilshire: On safety, and first to both the local authority representatives, given that most accidents seem to happen near airports, how much interest do you take in the safety role of the CAA? Cllr Cadbury: I had always been led to believe that Heathrow was as safe an international airport as any until I read the report in The Times a couple of weeks ago of the Accident and Investigation Bureau on the US 747 flight that was stricken in April 2004. It was flying over the South-East of England on one failed jet engine and three unpowered engines. In its difficulties, it was trying to work out where to land. Because it had seen Heathrow by visuals - luckily it was a clear day - the pilot asked Air Traffic Control whether it would be okay to land at Heathrow. Air Traffic Control, based on their guidelines, basically thought there was no problem. The aircraft ended up taking quite a wiggly direction in order to lose height from central London over West London to land at Heathrow. Thank goodness, it landed safety. What the AIB pointed out was that the guidelines for ATC said very little about the need to avoid built-up areas when an aircraft is in trouble. I was really shocked to find that ATC does not have powers to direct a pilot to an airfield where the risk from the ground is much lower. The only danger indicator that ATC is required to look at is if a flight is carrying dangerous goods. In my view, a 747 that is loaded with fuel to cross the Atlantic in itself is carrying dangerous goods. We definitely believe now that the CAA should seriously, as the AIB has recommended, look at that. Q581 Mr Wilshire: Can I pursue this, Chairman? That is a long answer to a question I did not ask. The question I asked is: does your council engage with the CAA directly to discuss safety matters so that you are satisfied that it is doing its safety job properly, not about your reading things in The Times? Cllr Cadbury: We will be doing so now. Q582 Mr Scott: On the point you were mentioning about the jumbo jet which fortunately did land safely at Heathrow, do you agree it is absolutely ludicrous to fly a plane over London, including over my own constituency, when it could have been safely landed at a designated airport such as Stansted? Cllr Cadbury: I find it ludicrous it was directed over central London and that the ATC did not have the power to direct it elsewhere. Chairman: You have been very helpful. Thank you very much indeed. Memorandum submitted by the Department for Transport Examination of Witnesses
Witnesses: Ms Karen Buck, a Member of the House, Parliamentary Under Secretary of State for Transport, and Mr David McMillan, Director, Aviation Directorate, Department for Transport, gave evidence. Q583 Chairman: Minister, we are very grateful to you for coming this afternoon. and I apologise for keeping you waiting. Could you both identify yourselves, please? Ms Buck: I am Karen Buck, Minister for Aviation. With me is David McMillan, who is Director for Aviation in the Department. Q584 Chairman: Is there anything you want to tell us first, Minister? Ms Buck: Given the pressure of time, I am quite happy to go straight to questions. My only statement would be a rather general one. Q585 Chairman: That is very kind. Could you tell us what the Government thinks is the reason for the continued existence of the CAA? Ms Buck: The CAA is the bedrock of regulation for aviation in this country. If you look at the framework internationally for ensuring that aviation is first and primarily safe and secondly that whatever necessary regulation takes place, it is based on states having that key responsibility. I will not pre-empt questions that the committee might want to ask in terms of the European agenda because there are major changes there. That key responsibility remains, even during the period of change: safety first and foremost; economic regulation issues; consumer protection issues; and a contribution, of course, to the development of aviation policy. Q586 Chairman: Has the Government considered transferring the economic and commercial activities to a single transport economic regulator for all modes of transport? Ms Buck: We do not think that would be the right way to go. If anything, the trend is in the other direction with the way the Rail Regulator is going. We believe that effectively incorporating in a single body that key responsibility for safety and economic regulation and having those constantly acting as checks and balances against each other is very important, and perhaps particularly important in a field like aviation. Q587 Chairman: What will the CAA look like in 20 years' time? Ms Buck: It will look different because we know that the European agenda particularly has been moved into the era of the Single European Sky and the framework of EASA will reduce the number of those responsibilities. I am sure that as the framework set out in the first year of the Air Transport White Paper unfolds, there will be potential changes in that as well. I do not think we have a fixed blueprint for exactly what it will look like. In fact, we are very much at a point of flux and very rapid change. It is important to let some of that settle down first. Q588 Mr Donaldson: It has been suggested that the CAA should be given a wider remit in terms of promoting all aspects of aviation, including innovation, exports and sports, and that it should report to the Department for Trade and Industry as well as to your department, Minister. Would you be in favour of such an expansion? Ms Buck: I am not terribly familiar with the specific proposals, to be honest. I think it is very important that clarity is retained. I would not want to see anything that muddies those lines of accountability. The CAA is accountable through the Department for Transport to Parliament and we know for a fact that there are other departments - the Ministry of Defence is a good example - where there are relationships with the CAA. I would like to see that flourish. It is a very healthy development. I would not particularly want to see any muddying of the lines of accountability. Q589 Mr Donaldson: The CAA sponsorship statement commits the Department and the CAA to critically reviewing the Authority from time to time. When did you last undertake such a review of the organisation's continuing relevance, efficiency and effectiveness and what was the outcome of that review? Ms Buck: It is a fairly continuous process. We have a number of different locks into the system from the sponsorship statement through to the corporate plan and the annual report and the constant process that we have of working with the CAA in seeing how it is fit for purpose as the situation changes. Mr McMillan may like to flesh out some of the detail on that. Mr McMillan: I think the Minister has hit the main points. The CAA has a corporate plan which flows in some ways from the sponsorship statement, and the corporate plan is something that should be reviewed on an annual basis. The CAA reports on the corporate plan in its annual report and we take account of that. Ministers are able, through the process of regular engagement which they have with the Chairman and which I have with the Chairman, to ensure that the organisation remains fit for purpose. Q590 Mr Donaldson: There is, surely, a distinction between an annual review process and a strategic review of the CAA's role. Is that not something the Government or the Department would consider undertaking? Mr McMillan: As the Minister has just said, that is something which may be necessary in time. At the moment, we are seeing rapid change in the regulatory framework which exists in the European Union with the creation of the European Aviation Safety Agency system and the expansion of the Single European Sky. In time, and I would not like to predict when, perhaps. Q591 Mr Donaldson: You mentioned the corporate plan and the annual review. We have received evidence that there is poor integration and coordination between the Department and the CAA in some areas of policy development. What efforts is the Department making to improve this situation? Ms Buck: With respect, you might have heard a representation to that effect. I am not sure I would accept that as constituting evidence. We think we have an excellent working relationship with the CAA. Q592 Chairman: Minister, any evidence that we receive is evidence. Ms Buck: I completely concede the point, Mrs Dunwoody. I was really making the point that from my point of view it would be subjective. Q593 Chairman: It may not be something the Department likes but it does not mean it is not evidence. Ms Buck: I consider myself chastised. I take the point entirely. I would very firmly state that I believe that our integrated policy of working with the CAA is very good. The CAA obviously played a critical part in the development of the White Paper on all aspects. We meet minsiterially. The Secretary of State meets with the Chairman of the CAA on a quarterly basis; Mr McMillan and officials meet on a very regular basis on all aspects of development and policy. I really would refute that evidence. Q594 Mr Donaldson: If you are not satisfied with the decision adopted by the CAA on a particular aspect of that policy, and indeed on their performance generally, what action can you take as the Department to deal with that issue? Ms Buck: The answer is that it varies according to what it is. There are some ways in which we value the independence of the role of the regulator. We might not necessarily always agree, as indeed we did not absolutely agree, despite our great respect, on the issue of financial protection. In terms of performance, I would re-state our view that there is a number of objectives set out in the corporate plan and we require and expect the CAA to fulfil constant self-improvement and meet those objectives, and the standard of doing so is very high. Q595 Clive Efford: Sir Roy McNulty painted a very colourful picture in expressing his views on EASA. He said: "EASA is experiencing significant difficulties in getting itself set up and operating in a satisfactory way for a range of reasons [...] I think so far we are a bit disappointed with the way it has got going." Do you share that view? Ms Buck: Yes, we do. We too are concerned about the unfolding of EASA and the fact that there has been a number of problems in governance and funding and so forth. The Secretary of State wrote in December setting out very clearly his views to Vice President Barrot. One of the consequences of that is that a high level official meeting will take place next week to move that concern forward. Q596 Chairman: Between whom, Minister? Mr McMillan, who is going to be there? Mr McMillan: Sir Roy McNulty and I will be leading for the UK and we will be seeing our opposite numbers in the European Commission. Q597 Chairman: Are we to take it that that is the United Kingdom Government making representations to the Commission about the failure of a European institution to work and not wider than that? Mr McMillan: I am not sure I quite understand the question. Q598 Chairman: It is very simple. Are you going to whinge at the Commission or are you going to have a joint meeting of various people who think that this particular organisation is not working? Mr McMillan: There is quite a lot going on. This particular meeting which the Minister has referred to is a bilateral meeting which we are going to at the behest of the Secretary of State. Q599 Chairman: Okay; thank you. You are going to give us a note of what happens when you get there, are you not? Ms Buck: We would be very happy to keep the Committee informed. I know it has a very legitimate interest in this issue. Chairman: Oh, we do, we do. Thank you, Minister. Q600 Clive Efford: In relation to EASA and the difficulties in getting it set up do you have any concerns about maintaining levels of safety and the possibility that they may deteriorate to the lowest common denominator? Ms Buck: Clearly that is the bottom line. As Sir Roy McNulty said, we are not in a position currently where we believe safety is compromised. I believe he said, "We are not here today; we are not here tomorrow", and that is first and foremost among the motivations for driving this forward, both politically and at official level. We are very aware that, unchecked, there could be an implication for safety and that is exactly why we are absolutely focused and determined not to allow that to happen. It is not just a question of having this meeting on 9 February. The UK is taking a leading role now on a number of practical changes to raise the game with EASA, in particular looking at governance and the manpower issues which have been a key part of their delivery. There is, of course, an urgent valuation taking place on their financial situation as well. Q601 Clive Efford: That was my next question. Do you think that EASA can become fit for purpose in time and, assuming that the answer to that is yes and that we are engaging with them, what needs to be done to ensure that comes about? Ms Buck: Yes, I do believe it can be made fit for purpose and it is still relatively early days. That is not detracting from the seriousness of the concerns that we have but it is early. It is very important also just to pull back a little bit and say that there is not an alternative. We started from the point of view of having a number of co-operative arrangements on the European aviation scene but at the level of national bodies, the joint aviation authorities, which effectively were becoming unfit for purpose themselves because they lacked the legal basis for carrying out some of the regulatory functions that we needed to have. We are not starting at the point of saying can we pull back from having a European approach to a number of these measures. We have to have one. The previous one was not delivering at a time of major change what everybody regarded as an important development towards the single European sky and so we moved into EASA. We have found a number of early difficulties, some of which, such as the relatively short start-up time and so forth, gave EASA a bit of a struggle in itself but there are also some real structural difficulties that we want to overcome. We are confident that they can be overcome because they have to be overcome and the CAA will work with us as a department and politically to make sure that happens. I say to the Committee that the Secretary of State has made crystal clear that if there is the slightest doubt that safety is in danger of being compromised the CAA will step in and ensure that functions are carried out in the country. Q602 Clive Efford: The CAA has identified a number of inefficiencies in relationships between the CAA and EASA and some organisations have expressed concerns that there may be double charging as a consequence of that. Can you tell us what the department is doing in order to ensure that the British air industry is not disadvantaged as a consequence of that? Ms Buck: We have not seen any evidence of double charging. In fact, the way it works is that the CAA is carrying out some functions on behalf of EASA because EASA is not yet in a position to carry those out, but then the CAA charges EASA for those functions so there is not double charging. I think industry was looking, and quite legitimately continues to look, for there being some financial advantage in the medium term as there are economies of scale from operating some of these provisions at a European level. We have not got there yet but that is one of the promises. Q603 Clive Efford: The industry is concerned that there is the potential for that as responsibilities transfer and they want to see a corresponding reduction in costs and the Department is aware of that presumably. Ms Buck: Yes, absolutely, but there is no evidence of double charging. Q604 Clive Efford: There are also concerns about staffing around EASA in the fact that the slowness with which it has got off the ground has led to a lack of expertise in its employees. Do you have a comment on that? Ms Buck: Clearly that is part of it. Manpower and budgets are elements, are they not? They are very much at the heart of our concerns about the way EASA is operating. It would be fair to say that more recently there have been some signs of grappling successfully with those problems. There have been issues about whether some people want to transfer to Cologne or not; there have been some issues about whether the qualifications that are required by EASA fit the profile of the highly skilled operators in this country because of the formal nature of the qualifications required by EASA. We are working very closely on overcoming those. I think there have been some recent signs of improvement. Mr McMillan: The agency is roughly halfway towards achieving its desired manpower level and we have seen recently some encouraging signs of, for example, UK experts taking up positions. The point I would add to what the Minister has said is that we need to realise that the pool of regulatory specialists in Europe is quite a small one and it is essential that that pool is retained either within the national aviation authorities or in EASA to ensure we have safety. Q605 Chairman: But are you really saying, Mr McMillan, that it is not happening? The answer to the question that Mr Efford has posed is really that as an agency it only has one or two minor problems: it does not have enough money, it does not have the right staff, it is not appointing the right people, it is not at all clear what its remit it, but apart from that it is doing very well? Ms Buck: The problems you have just identified are the problems which need to be resolved, Chairman. Q606 Chairman: But on what timescale? Forgive me, but we are not talking about buses running down Oxford Street. We are talking about safety across not only a capital city but across an island which is extremely full of people and where somebody may make a mistake because someone else in Brussels has not managed to find one of these limited number of regulators to appoint. It is not going to wear very well with the people who are underneath when something goes wrong. Ms Buck: No, and, to be fair, I am not arguing for one second that we are painting a portrait of an organisation which is doing very well despite all those problems. It is not doing very well. Q607 Chairman: I would hope not, Minister, because you would have a little bit of scepticism to deal with. Ms Buck: That is scepticism shared. It is not fit for purpose at the moment. We recognise that picture painted by Roy McNulty. The Secretary of State at a senior political level is actively engaged in working with the Commission and with other European partners who probably started off not fully recognising this time last year that we were heading into difficulties but who are increasingly coming to the table and wanting to sort a solution out. Chairman: It is not exactly rapid, is it? Q608 Mr Scott: I have some concerns. As you will be aware, when you look back to April 2004, a jumbo jet en route from Germany to an air force base in the United States was over-flying, as it happens, my own constituency with many others, and instead of being diverted to the airport which is usually designated for emergencies, which is Stansted, it was, with one engine down, three engines with a lack of thrust, diverted to Heathrow. If we are talking about EASA not being fit for purpose or lack of safety measures, and I appreciate these things might take time, do you not think that the people whose homes that plane was flying over have a right to know (a) what was on it and (b) why it went to Heathrow? Ms Buck: I will ask Mr McMillan to answer on the detail of that incident. Q609 Chairman: Mr McMillan, do we know about this one? Mr McMillan: This was an incident on which there was a recent report by the Air Accident Investigation Branch which made some recommendations which the Civil Aviation Authority are urgently and carefully reviewing to see whether the current guidance which is given to air traffic control staff in this country is adequate or whether it needs to be changed. The fact of the matter is that on a tactical level it is always going to be for the air traffic control staff to take decisions about what the right thing to do is in a particular incident. This is certainly something which is being urgently reviewed as to whether the procedures which are currently in place are the ones which should remain in place in the future but, let us be clear, that is not something where competence has been transferred to EASA. That is a matter which is purely and simply for UK instances to decide. Chairman: And you have taken that on board. Q610 Mr Goodwill: When you were signing up to this EASA transfer of competences did anyone in the British Department for Transport and in any of the other Member States forecast that these problems might occur? Ms Buck: Let me start by repeating that it is incredibly important to say that EASA has come into being because we did not believe, and it was a broadly based belief, that the previous system was fit for purpose. What we now recognise and did not recognise this time last year - although it may be that there was departmental knowledge that I do not have - is that the kinds of structures of governance for EASA, which are very much an EU model, were not really appropriate for some of the demands that we placed upon it for aviation purposes. There has been a very sharp learning curve in all of that. Some of those issues around staffing and finance I do not think would have been predicted. It is important to say that the Secretary of State again has made very clear that there have been no further transfers of any functions whilst we remain unconvinced ----- Q611 Chairman: Yes, but we have taken evidence that in fact what is happening is that the CAA is losing people. It is what happens whenever you have put a blight on anything. It does not matter whether it is a school, a hospital, whatever it is. If you say, "In the next four or five years this place is going to cease to operate", people, particularly ambitious, sensible people with ability, just put their coats on and go and we have taken clear evidence that the CAA is losing people because they do not know what the future of their organisation will be. Simply saying, "We are not handing over the power until we know you are capable of doing it", is not only not a common sense response but it also happens to be a little bit tardy if you have already said, "However, we are handing over most of the tasks in the not far distant future". Ms Buck: I accept that. There is a very difficult balancing act to be struck. My understanding of the evidence Sir Roy McNulty gave was that the continuing principle is a future for EASA and therefore that process of changeover is always ----- Q612 Chairman: I hope you will say to this Committee that the Secretary of State will say very firmly, "No further transfer of powers" ----- Ms Buck: Yes, he has. Q613 Chairman: ----- "will be handed over in any way to this inadequate organisation which could put at risk any of the safety of the people of the United Kingdom". Ms Buck: I think I can say that without equivocation, Chairman. Q614 Mr Goodwill: You say you would not want to compromise safety but in his evidence Sir Roy McNulty made the point that other countries have much lower standards of safety than we do and there will be some averaging out. By inference the point was that even when EASA is fit for purpose there will be some diminution in the level of safety in this country. Are you happy to see that happen, Minister? Ms Buck: I will ask Mr McMillan to contribute but let me start by saying that the line of that argument is at least equally applicable to the system that existed before EASA. If one is arguing that there is a variation of performance ----- Q615 Chairman: No, Minister, forgive me. The difference was that these were voluntary standards. The JAA, I think Mr McMillan will have told you, was a different animal. Ms Buck: It was a different animal, yes. Q616 Chairman: It was agreement and everybody loved everybody else and eventually you came up with some mixed mess or whatever but the reality is that we are now dealing with an organisation which has the power to order countries to comply with its rules, and the point Mr Goodwill is making is a very sensible one: are you going for the lowest common denominator are you accepting that that will be lower than our existing safety standards? Mr McMillan, do you want to have a stab at that, if I may use such vulgar language in relation to the Department for Transport? Mr McMillan: I do not think we are heading for the lowest common denominator. What we are heading for is a legally based European Union-wide system which is going to ensure high levels of safety across the European Union. I do not think ministers in this Government or ministers in any other governments in the European Union would subscribe to "let us join together so that we can lower aviation safety standards". That is not what we are trying to do and that is not what EASA is designed to do. There are clearly some quite difficult transitional problems which need to be tackled very energetically and urgently but this is a system which has the capacity to be as robust, for example, as the much lauded US federal aviation administration on the other side of the Atlantic. It has the potential to have many advantages. We are not realising them yet. Mr Leech: As well as suggesting that we should not be transferring any other work to EASA until they are able to do it, should we also not be in a position where the CAA should not be running down certain of its departments because we have been told that the Safety Research Department has been run down in anticipation of EASA taking over those services but yet EASA are not providing that work at the moment? The Committee suspended from 4.01 pm to 4.11 pm for a division in the House Q617 Mrs Ellman: We have had information that the CAA is running down its Safety Research Department in anticipation that EASA will take that over. Are you aware of that? Mr McMillan: As I understand what the CAA is doing, after consultation with the industry, which effectively pays for the research which the CAA contracts for, it is running down research in those areas where competence will be passing to EASA. Q618 Chairman: I am sorry; we need to be clear about this. Which areas are those? Mr McMillan: The areas which are being passed to EASA, for example, certification of airworthiness, research in those areas it has run down and so the industry will not be paying twice, if you like, for research. They will continue research, in my understanding, in other areas where they have been active but they will not conduct research in areas where EASA has not been active. The unfortunate part, as I am sure you well know, is that EASA is not yet active in those areas of research. Q619 Mrs Ellman: Are you saying then that in these areas the research is being run down before EASA is doing that research itself? Mr McMillan: As I understand it that is the position on a temporary basis and the CAA has been encouraging EASA to get its act together and to start a research programme in those areas. Q620 Mrs Ellman: But who decided that the CAA should run down safety work before EASA was undertaking it? Mr McMillan: The decision was taken by the CAA in consultation with industry, as I understand it. Q621 Mrs Ellman: Did the Government have any role in that? Mr McMillan: I honestly do not know. I do not believe they were consulted. If I am wrong we will certainly write to you. Q622 Chairman: You do know there is a problem with certification, did you not, Mr McMillan? There is a problem with certification and that is well known, is it not? Mr McMillan: There is a problem with certification in the sense that it has passed to EASA and they are not doing the research, yes. Q623 Chairman: No, in the practical sense that EASA is not performing the role of certification in the way that the CAA have been doing. It is not providing the same level of speed and efficiency and performance. Mr McMillan: I am sorry; I misunderstood the question. Absolutely, there is a problem. Q624 Chairman: Then surely Mrs Ellman's question is even more relevant. Why did the Government, knowing that there was a problem in this field, not say both to the CAA and to EASA on the one hand, "Why are you running down research?", and on the other hand, "Why are you not appointing sufficient people to deal with this?". Mr McMillan: The position is that we have not encouraged the running down of research. Our expectation is that research should be continued by the organisation competent, be that the CAA or EASA. We need to ensure that that is happening. Q625 Mrs Ellman: Yes, but, Mr McMillan, can I stop you? The problem we have identified is that the CAA has stopped doing this work before EASA have taken it on themselves. Was the Government aware that that was happening? Mr McMillan: I became aware of it recently, is the answer to your question. Ms Buck: We know that this is at the heart of our dilemma, that we are in a process where EASA is taking on certain functions but in this first year of operation it has become apparent very quickly that there are delays and difficulties in delivering on key areas. The almost day-to-day balancing act that has to be undertaken with the CAA is how do you ensure that EASA is brought up to fitness to function and that there is not a double burden on industry and so forth without compromising the safety work that is going on in this country? There is not a magic solution to this, as Mr McMillan has already said. There is not an unlimited pool of resource and of expertise out there so this is a very fine balancing act that is going on at the moment. Q626 Mrs Ellman: The decision, it appears, was taken by the CAA but would you not feel that the Government should have some involvement in this area on the principle that surely it should be concerned if the CAA is stopping its safety work before EASA is taking it on itself, and the same could apply in other areas? Mr McMillan: Many of the problems which the Committee is very rightly raising today are problems of transition. It is absolutely clear that the transition has not been as well handled as it should have been and that is deplorable. What has now happened is that a transition working group has been set up involving all the national aviation authorities in EASA and it is led by the UK member of the board, I am pleased to say. The aim of this is to ensure that the kind of lacuna which you have lit upon here is not allowed to continue, that there is proper planning as to who is going to be doing what during this transition period and that it is properly managed. It would have been excellent had this transition working not been necessary and had the secretariat of the agency been better able and perhaps more resourced to do this work for themselves. That is not the position we have found ourselves in so we are taking urgent remedial action to put this right. That is the position we are now in. It is a transitional process which we need to have managed very effectively. Q627 Mrs Ellman: Are there any other areas of work where you think these transitional problems are being encountered? Mr McMillan: The main other area which is of concern is the central one of manpower planning which the Chairman and others have been referring to and that is one which is being tackled, as I say, early and objectively. Q628 Mrs Ellman: Does the Department have any concerns about lighter touch regulation? Do you feel that could compromise safety standards? Ms Buck: We would argue that that is not a term we recognise. The CAA regulatory regime is about being risk focused. "Lighter touch" implies a reduction. It is an appropriate use of resources and a far better way to proceed to ensure that in general you target your work at those operations where there are reasons to believe there are risks. Q629 Mrs Ellman: But could a risk-based approach not lead to problems even if those problems only manifested themselves later on? Ms Buck: It is a question of where the balance is truck always, is it not? The CAA has to balance a number of competing interests and pressures, safety being absolutely paramount. I think we all agree, and I am sure the Committee would agree, that the industry is certainly concerned that there needs to be a recognition of costs and that those costs are not passed on and borne by the industry, and therefore having an equal regulatory regime for some of those areas of service that have a distinguished record and where there are no reasons to believe that they are falling into a high risk category would not be a reasonable use of resources. Q630 Mrs Ellman: How is this required six per cent annual rate of return from the CAA justified? Ms Buck: The six per cent rate of return is predicated upon the capital resource that the CAA has and its exposure to its pension entitlements and its other liabilities and we consider that to be reasonable for the nature of the business. Q631 Mrs Ellman: When was this last considered? Ms Buck: We will check and let you know. Q632 Mrs Ellman: The CAA is the only European aviation regulator that is self-funding, is it not? Are there any plans to look at that again? Ms Buck: My understanding is yes, but what we understand to be the case is that a number of other European countries are beginning to look at that, and obviously EASA itself is a kind of step in that direction because those costs are passed on to industry. Mr McMillan: Funding models do vary across Europe and it is true to say that the CAA is at one end of the spectrum where all costs are recovered from those entities which enjoy the benefits of their regulation. For example, the French Government, the DGAC, is now charging the French industry for certification activities, for safety regulation activities, and I know that other countries are looking at the same thing. Of course, to the extent that EASA does come into play there is, there is a fees and charges regulation which will apply across the whole of Europe, so for many countries they will be facing charges and fees for the first time for these activities. The tendency is to move towards user paying as opposed to government paying. Q633 Chairman: So the simple answer to the question is yes, it is true that the CAA are the only people who are charging? Mr McMillan: That is the truth. Q634 Mrs Ellman: How do you know that the CAA are efficient? Ms Buck: The CAA is tasked with a number of responsibilities, including ensuring that it bears down on costs. It has set a number of objectives in that respect, and indeed in the current period the expectation is that costs will be kept below the current level of inflation, so that is a requirement, and industry itself expresses a view on costs and does so both directly to the CAA and to me. The CAA also was a party to the Hampton Review of Regulation and is playing a very important role in the whole Better Regulation framework. Q635 Mrs Ellman: It has been put to us that the CAA is over-reliant on the airlines because of the funding structure. Would you share that view? Mr McMillan: I do not know if that evidence has been put to you by the airlines. I rather doubt it. The fact of the matter is that the CAA has a strong reputation for independence and integrity. It gets it charges from a variety of sources. Yes, clearly, a very large proportion of it comes from the airline industry but I think the airline industry would consider that they have a robust regulation framework. Q636 Mrs Ellman: Would you say that general aviation has been given a fair deal? Ms Buck: I think that question is partly springing from the fact that they expressed a number of concerns about the safety charges review. General aviation I think is a very welcome and very important strand of the aviation sector and what I do think is very helpful is the fact that the CAA has decided to proceed with the regulatory review and also the general review of general aviation over the coming months. I think that is very helpful. It is a very good time to take stock. In the representations that have been made to me by general aviation there was a sense of, "We are making an important commitment here to the economic activities that we undertake through training and so forth but nobody really recognises and appreciates what it is that we do". That is anecdotal but it is important that that evidence is marshalled and put forward and I think that the review that the CAA will undertake will be very helpful in benchmarking that cost. Q637 Mr Wilshire: Can I go back to the safety issues? Mr McMillan has told us that in respect of the rundown of the safety issues research he only became aware of that recently, I think were the words he used. Could he tell us exactly when he became aware and how he became aware? Mr McMillan: You are testing my memory, Mr Wilshire. I think it was in connection with this inquiry. Q638 Mr Wilshire: So until we conducted an inquiry the department was blissfully unaware that there were safety problems? Mr McMillan: I do not think that is what I said, Mr Wilshire. I said I was unaware of the particular fact of the rundown of safety research in relation to the matters which we were talking about earlier. Q639 Mr Wilshire: Have you given instructions to the CAA to resume that work until somebody else is able to do it? Mr McMillan: No. Q640 Mr Wilshire: I think this is something which we need to look at in the context of the transition planning which I was talking to you about. If it proves that that is not going to be an acceptable solution then clearly we will need to go back to the CAA on that issue. Ms Buck: It is important to point out that there is a difference between the safety research and the certification. I am pleased again that Roy McNulty has assured us that in his view, the CAA's expert view, safety is not currently being compromised. He said, "Not today and not tomorrow". That is advice that we take very much to heart. We want to make sure, and the CAA wants to make sure, that EASA delivers effectively and we will not seek a safety compromise in that process but we are in a dynamic situation. We are driving this forward, we want to see the CAA work. If necessary we will pull stumps, we will do what we have to do here, but at the moment, and we have a meeting set for next week in the middle of these negotiations, the absolute priority is to drive forward and make sure that those functions that are appropriately being moved towards the European level are moved. Q641 Mr Wilshire: I am grateful to the Minister for saying that because this is the very point I want to come to next. On both occasions you have correctly quoted Sir Roy as saying, "Not today, not tomorrow". You then said that he had indicated that at some stage in the future safety could be compromised. My language, because I specifically asked him about the 70,000 constituents I represent who are smack up against the boundary fence, was, "Perhaps it is not tomorrow or the day after but will there come a point when their safety is compromised" - not "could be"; "is" was what I asked - and the answer I got was, "Yes", so we are not talking about hypothetical; we are talking about something that in his view will happen, and you then have gone on to say that the CAA will step in. I am delighted at that, that is exactly what should happen, but the question I want to ask you is, are you certain that the CAA has the power to step in now Brussels has got involved and, secondly, have you yet instructed them to step in should it become necessary because my 70,000 constituents are going to become very worried shortly? Ms Buck: Absolutely. I have no reason to doubt that the CAA has the capacity to take what action is necessary. Q642 Mr Wilshire: Capacity or authority? Mr McMillan: Authority as well, if we were persuaded the system was not working. Ms Buck: The Secretary of State has also left us in no doubt that that is his intention. There was no equivocation in any of this. We want EASA to work but if we are at a point or close to a point where we believe that safety is being compromised, and we are not there now, we will take what action is necessary and we believe that we have the resource and the capability to do that. Q643 Mr Wilshire: How long are you prepared to give EASA to sort themselves out before you take action? Ms Buck: Do not forget that there are a number of different strands within EASA to be delivered. To be fair, we have a very high level meeting next week. I do not think you can set an arbitrary deadline for this, I really do not. Q644 Mr Wilshire: Why not? Ms Buck: Because it would be arbitrary, by definition. I am not sure that I can sit here now and say to you, "This is the kind of deadline we will set". The point is that this is under constant review. It is constantly being assessed within the department and within the CAA and if we believe that we are at a point where any of those processes, certification or regulation, are compromising safety then we will take what action is necessary. Q645 Mr Wilshire: But if you are not prepared to set a deadline it sounds remarkably to me as though you are saying that what you will do is wait until it becomes dangerous and then do something about it. Ms Buck: No. I absolutely refute that. I cannot sit here now and say to you, "This is what the deadline will be". After next week when we have had the high level meeting we have a number of processes in train at the moment that Mr McMillan has outlined to deal with budget issues, to deal with manpower issues, which are very much at the heart of what is going on up here, and we have to assess in almost a daily process how that is being delivered. Q646 Chairman: It is clear now what the position is but I am sure Mr McMillan also accepts that the Committee are very worried about this and when we are preparing the report it would be extraordinarily helpful if we could have a note after that meeting with some indication of what the Department has agreed and where it thinks it is going. Otherwise, frankly, this is something we are going to return to again and again. Ms Buck: No problem. Mr McMillan: I wonder if it would help, Chairman, if I were to offer you a note which sets out not only the outcome of that meeting, which I hope will take us forward, but also the range of activities that we are engaging in to try and address this issue collectively because I think you can get a better picture of what is going on if we do not limit it just to that one thing. Chairman: I am all for better pictures, Mr McMillan. Clive Efford: I am not asking for a response to this now because you have asked the Department to write to us, Chairman, but one of the points I want to stress is that we have received evidence from an aviation safety expert that EASA has not even published a budget for its research, which is an area of concern if they have not even set out the money they intend to invest in that area of research, and yet the CAA has transferred that responsibility to them. Q647 Chairman: Point taken, Mr McMillan? Note included. Mr McMillan: Absolutely, Chairman. Q648 Graham Stringer: Can you tell us what there is about the aviation industry which requires a regulator to be a completely different structure from anywhere else in the UK, ie, the CAA is an economic regulator, a safety regulator, it does all sorts of things that regulators in other parts of the economy cannot do? What is it about aviation which determines that it should have a regulator structured in such a way? Ms Buck: I suppose my best answer to that would be to say that probably the safety agenda is of such a different order and such a priority that we have seen it as necessary and desirable, and believe it has been effective, that the economic and safety regulations are combined in a single organisation. Mr McMillan: The question is interesting: what is there specifically about this industry which requires it to be regulated in a different way? I think there are various strands to that. One strand is, as the Minister says, that it is an industry where there is a peculiar interplay between economic regulation and safety regulation and we need to get those two things very carefully together. It is also an industry where there is a very large international aspect to the activities which it engages in and, although that is true, I am sure, of other industries, I think in the aviation industry it plays a particularly large role in it and that means that there are many opportunities to learn from the economic side, the consumer protection side and the environmental side of every single body. Also, frankly, it has grown up that way and it has proved to be a very robust and effective model. Q649 Graham Stringer: Those are interesting answers, but we have heard evidence from the piloting by other people that there is a conflict between safety regulation and economic regulation, that the economic regulator is saying, "We want fewer delays at peak time so you have got more capacity", whereas safety considerations might be different and regulating air space might have a third consideration. It is odd in that situation that they are in the same organisation where there are conflicts which are determined by one person. Usually safety is separate, is it not, or in one body? Ms Buck: It is absolutely inevitable that there is always going to be some form of critical tension between a number of different objectives. The argument is, I suppose, whether the addition of another layer of cost and bureaucracy would be cheaper for industry and more effective at delivering what has been handled in the safety regime, and I do not see any reason to think that that is the case. Q650 Graham Stringer: Why do you not think that is the case when you have said, and everybody round this committee will agree, that safety is paramount? Is it not more likely to be more effective, if safety is paramount, if there is one safety body whose only function and task is to look at the safety of the industry? Ms Buck: I do not really see why that should be the case. It is very much an argument where, with the safety agenda coming first, it has to be assured within the industry that the economic and costs case does not compromise safety and vice versa. That tension is going to exist. In effect, if I can just turn this round, I think the case would have to be made persuasively on the basis of track record and the presentation of an argument that an alternative would be better. I have not seen that. If that argument were to be made then no doubt this would be something that we would all reflect upon. Q651 Graham Stringer: People in evidence have made that argument and there have been other cases in other transport industries where the safety regulator has been pushed to one side because there were other considerations involved. I am thinking about the Health and Safety Executive which the Government decided to take out of rail regulation because the man in charge of it was basically pushed to one side. Both in principle and in practice there have been problems. I am surprised, though I do not want to use any pejorative terms, that you are relaxed about them being in the same structure when, in answer to the first question, you could not really give a reason as to why they are together in the first place or that there are any real benefits of that. Ms Buck: I would not describe myself as being relaxed. What I would say is that if the system is working well, has an excellent track record and is held in very high esteem across the board there must be a robust case for making changes. I am not saying those changes can never be made and that a robust case will not appear. All I am saying is that I do not think that is the case at present and in the rail industry we are turning back in the other direction. Q652 Graham Stringer: You have read the evidence to this Committee, I take it, for this interview? Ms Buck: I have read a lot of the evidence. Q653 Graham Stringer: So you have read the evidence where some of our witnesses are saying that at least two of the four airports that are now economically regulated could be taken out and it could be left to the market to determine their landing charges. Do you have a view on that? Ms Buck: As a Department we have not been approached on that issue. I think you are talking about Stansted and Manchester. Q654 Graham Stringer: That is correct. Ms Buck: There were some criteria set out about ten years ago which were effectively what would be used to judge whether there was a case for de-designation, looking at profitability and the extent to which the monopoly existed. It would be for those airports to come forward with an argument for de-designation and it may well be that that case could be made. We would have to be assured that the model for competition was there and proven and that it could be tested against that, and also that in a very rapidly changing situation, as outlined in the Air Transport White Paper, we would not then be called upon perhaps a few years down the line to re-designate. If all those criteria were met there is not in-principle opposition. Q655 Graham Stringer: But that might be a good idea, might it not, to be able to re-designate to test the system and see if there was any abuse of a potential monopoly system, so you would be able to look at which way landing charges were going and which way the price of tickets was going? Would that not be a good idea? Ms Buck: It has merit and I think uncertainty can be set against that. What I welcome is the fact that the CAA are carrying out a market analysis to see whether those conditions exist. I think that is going to be a very interesting piece of work so let us review it. As I say, it is for those airports on a set of criteria which are out there to come forward and say, "Is this something that you would want to consider?", and that may be the case. Q656 Graham Stringer: Do you think it is a good idea, as again some of our witnesses have said, if BAA, which is clearly a monopoly in the London area, was broken up into three separate companies based on Gatwick, Stansted and Heathrow? Ms Buck: The question is, would that introduce competition, and I am not sure in the position of those London airports that that would be the case. Q657 Graham Stringer: Do you not think that if Heathrow and Gatwick were separate companies they would not compete for traffic and airlines? Liverpool and Manchester compete, Birmingham and East Midlands compete. In a much bigger market why would Gatwick and Heathrow not compete on price? Mr McMillan: I suppose it is possible that competition between those airports might intensify if they were in different ownership. There are lots of issues which are raised. Q658 Graham Stringer: There is no competition at the moment because they are the same company, so it would not intensify; it would begin. Mr McMillan: Those airports do have other competitors in the London market which exist, but I do take your point. There are other issues which I think the Minister would want to reflect on, although this is no longer a matter of ministerial discretion; this is mostly a matter for the competition authorities. Under the Enterprise Act it is for the OFT to make a recommendation to the Competition Commission as opposed to ministers intervening in the market in the way you suggest. Q659 Graham Stringer: BAA do take a lot of notice of the Department's views. They are interested in whether the Department has a view, if not the responsibility. Ms Buck: I am sure they are but part of the principle of the Enterprise Act is that we feel it is not necessarily appropriate for the department to be giving a steer on something like that. Mr McMillan: The final point I want to make is that one of the key considerations, if we amended it, would be what arrangement of ownership in the London system is going to give you the necessary capacity in the quickest time that you can deliver, because one of the key issues for the south east is to get more runway capacity into the system? One of the key questions would be to decide whether you would secure that more quickly by having airports in common ownership or airports which are independently owned. That then plays back into the decision which the CAA will be taking in due course as to how we are going to treat the three airports as part of this quinquennial review. Q660 Graham Stringer: I will resist saying what I was going to say on that. Perhaps I should not resist. BAA took a view that they would wait until the Department had decided where they wanted the next runway in London. I would have thought if it had been three airports operating separately they would all have wanted extra runway capacity. Would you not? Ms Buck: I think this is a slightly hypothetical question. Graham Stringer: It would be an odd business that did not want to grow with extra capacity. Chairman: Unless it was rail. Q661 Graham Stringer: My final point is that I did not quite understand the answer to Mrs Ellman's question about the six per cent return. When there have been no assets transferred to the CAA for 30-odd years and there is a six per cent return still paid by the industry, is that not an excessive burden when most other industries would have written off those assets a long time ago? Is it not an unfair burden on the industry? Ms Buck: You test my knowledge to its limits. Q662 Chairman: Mr McMillan, why does this Treasury still want to get its sticky fingers on somebody else's money? Mr McMillan: I am no accountant but, as I understand it, ----- Chairman: I do not think you have to be an accountant to understand that theory. Q663 Graham Stringer: You would not normally have expected at that rate the assets to be paid off in less than 20 years. Mr McMillan: As I understand it, it does apply to current capital employed. I may be wrong about that and if I am I will send you a note. The sums involved are not huge but I do accept that the industry is not content for those sums to be levied. There have been occasions in recent years when the requirement to earn that rate of return has been eased and the rate of return monies which have been generated have been used for purposes which I think the industry has found generally beneficial, for example, to pay for some transition costs on EASA and so on. There are points of principle but there are also points of materiality here. Q664 Graham Stringer: Do you think you could send us a note on that? Mr McMillan: With pleasure. Q665 Chairman: I want to bring you on to assets. The National Audit Office do not have a look at anything the CAA does and we are told that this is because, of course, it is sui generis. Why is it different from other independent regulators who also self-fund? Ms Buck: As I understand it, the NAO proposal was not supported by the Government and it is being strict that the regulator is not funded by public money other than for very specific tasks that it undertakes for the Government for which we pay it. There is a wide range, some of which I have already outlined, of different means by which its work, its financial structure and so forth can be held to account and external auditors appointed by the Department to scrutinise its finances, its annual report brought to Parliament through the Secretary of State and the Department playing a key role in relation to executive and non-executive directors. We think that that range of functions is properly fulfilled at the moment. Q666 Chairman: There is not any very clear transparency. Why should they not have a regular independent review of the charges? Ms Buck: Charges for what? Q667 Chairman: NATs, for example, says that there ought to be scope to reduce costs. The NAO does not look at this. You are saying that they have an auditors' report. Well, of course, many companies have an auditors' report but this particular organisation is fulfilling a very different function from any other. Why should there not be a totally independent assessment of how it is operating and its cost base if the Government is not prepared to accept that the National Audit Office, which is the normal gatekeeper, should be allowed to come in and ask the awkward questions? Ms Buck: They are expected to be tackling the issue of costs. They have been set a very specific requirement to reduce costs. Q668 Chairman: But there is no-one who checks the basis on which that is assessed. Ms Buck: I think I would argue that there is a high degree of transparency in the way this is conducted, and they are under an obligation to be open and transparent and industry has not only the opportunity to be involved and to contribute directly to that but also through this Department. Q669 Chairman: The CAA has a responsibility to advise the Government. Do they respond to Government inquiries or do they routinely tell the Government what is of importance in aviation? Ms Buck: Neither and both. It is a two-way dialogue. There is a constant process by which the Department at ministerial and official level is seeking reports on how they carry out a range of functions, which include cost control, and they advise the Government about how they are going about that. In addition to that we see representatives of industry who make their case. Q670 Chairman: Yes, but British Airways had a whinge, saying that they go well beyond their formal remit as an adviser to the Government, "It is not clear it has always been asked for, why should we pay for it?". They did not put it in quite those terms but that is what it came down to. Mr McMillan: As the Minister said, there is a very detailed and very open process whereby the industry can challenge the CAA in each of the areas of recognition on why they are spending what they are spending, on why they are deploying the resources that they are deploying, and if they felt, for example, in that particular case that the CAA were conducting policy work on behalf of Government which we were not reimbursing them for, it is entirely open to industry to challenge that funding with the CAA, and I have no doubt that they would do so. Q671 Chairman: You did say at one point as a Department that you were going to change the system of mandatory referral to a Competition Commission. Ms Buck: We did say that and there was a time at which there was emerging consensus that that might be an appropriate way to go forward. Q672 Chairman: So the Government changed its mind, did it? Ms Buck: I think the consensus broke down, to be fair, so that it would probably not be wise to go ahead if there was not some degree of support for a particular direction of travel. Q673 Chairman: But that is the only reason, that consensus broke down? Ms Buck: It is the only reason that I am aware of. Q674 Chairman: We have, not surprisingly, heard a number of real worries about the CAA and its environmental role, whether it is conscious always of the need to include environmental problems in its assessments, whether it is conscious enough of its responsibility to keep people informed, whether it takes sufficient account of environmental affairs. We have also been told that, of course, in 20 years it is going to be a completely different organisation. Do you think they are going to get new roles and powers in terms of minimising and mitigating environmental impacts? Ms Buck: The CAA is explicitly required to identify and review significant environmental aspects of its work. The particular relevance of that is ----- Q675 Chairman: It seems to me there is some ambivalence on its part, is there not? Sometimes it will account to us and say, "Yes, we have an environmental responsibility", but when it is dealing with individual local authorities perhaps or others who seek some guidance it tends to give the impression that it is saying, "Not us, guv", in regulator's language, of course. Ms Buck: I am very clear that the guidance we gave to them in 2002 makes it clear that they should do that. One of the things that I understand they are currently doing is drawing up their own guidance to the proposals of air space changes as well, the particular strand of it that is of concern to people, so that that environmental dimension is drawn out and emphasised. I am absolutely clear that, as aviation has grown (and is set to expand in the White Paper) that getting this right is critically important and that there is not going to be an opportunity for environmental considerations to slip down the agenda. Q676 Chairman: You do not think there is a conflict between an obligation to ensure that public demand for air transport services is satisfied consistent with good safety and their role as an environmental policeman? Ms Buck: As with previous offices, I think the fact is that all these things are in tension. There is an economic benefit to aviation; there is huge public demand out there for aviation. There is also an absolute bedrock expectation that safety is paramount and there is a growing and real and serious concern about the environmental impacts of aviation which has to be addressed. Those criticisms cannot always be reconciled to everybody's satisfaction in one policy but all three of them (and others too) essentially have to be kept in a proper balance over time. Q677 Chairman: The CAA does not have a statutory obligation to keep local authorities aboard and consult them, does it? Ms Buck: I do not believe it is a statutory obligation. It is guidance that we require them to take account of. Q678 Chairman: But if the guidance is not working very well as far as those who are making representations are concerned, would it not be sensible to at least consider whether it ought to be part of a statutory obligation? Ms Buck: The guidance has been out now for four years and there may well be a time when it is appropriate to review that, and I am not going to pre-judge how that might unfold. Q679 Chairman: Would you also consider in your review looking at whether the CAA should have powers to impose sanctions on airports and airlines which do not fulfil the targets on mitigation of damage to local communities? Ms Buck: We have introduced, as I am sure you are aware, Chairman, a number of clarifications and strengthening powers in these respects in the Civil Aviation Bill which is currently in front of Parliament. I would not rule in or out how we would take that forward. Q680 Chairman: Minister, we need from you a note on what is happening up to date with the EU/US negotiations. Is that possible? Ms Buck: Yes, certainly. Q681 Chairman: Is there any progress at all to report, Mr McMillan, or are we still swimming in the broad and hopeful sea of mud that most European negotiations seem to represent? Mr McMillan: The fact of the matter on this case is that there has been some progress in as much as there was quite a successful round of negotiations led by the European Commission with Member State representation with the Americans before Christmas. What it all hangs on now is to see to what extent the American administration is able to deliver effective access to the US market and, as you probably know, there is a proposed rule-making process in place and we await the result of that with some interest. Q682 Chairman: And you are going to give us a little detailed note on that? Mr McMillan: Indeed, yes. Chairman: Minister, you have been, as always, very helpful, and very patient. Doubtless we shall meet again. Thank you very much. |