Memorandum from British Airways Plc (TS
25)
1. INTRODUCTION
1.1 British Airways welcomes the opportunity
to submit evidence to the Transport Select Committee on the subject
of travelling without fear. Its comments relate solely to aviation.
1.2 The airline's main base is London Heathrow
Airport, the UK's primary international hub airport and one of
the busiest airports in the world. British Airways also operates
from 11 other airports in the UK, and worldwide, to 153 destinations
in 70 countries. Its franchise partners take the airline's colours
to an additional 85 destinations in a further 17 countries.
1.3 Security and safety are of the utmost
importance to British Airways and at the core of all operational
decisions. Annually, the airline spends more than £120 million
on security across its network.
1.4 Following the tragic events of 11 September
2001, British Airways spends in excess of £100 million per
annum on aviation security provision. This is in addition to the
£23 million spent on upgrading cockpit doors and the installation
of CCTV on its fleet of Boeing and Airbus aircraft. Such expenditure
on aviation security protective measures, not all of which are
mandated by Government or Host States, remains significant within
the business.
2. OVERVIEW
2.1 The comments provided within this submission
should not be construed as representing overt criticism of the
Department for Transport. We very much value the relationship
that we have developed in recent years. Given the intention of
regulation, and the structures within which we have to interact,
we believe that we have worked well together in the interests
of the travelling public. We look forward to working more closely
together as we face the challenges ahead.
2.2 The UK has been at the forefront of
security regulation and technology in the post-Lockerbie security
environment. Measures such as hold baggage screening systems were
implemented in the UK many years ago at significant cost to the
UK aviation industry. Other countries, currently Italy and Canada,
are now introducing these although their respective governments
are funding them.
2.3 The level of threat to civil aviation
in the United Kingdom is assessed as "substantial".
This level is a judgement applied by the Government's security
services, and sits outside the control or influence of airlines.
The translation of threat into measures to protect aviation against
terrorism is the responsibility of the Department for Transport's
TRANSEC team.
2.4 The regulations that govern aviation
security measures for UK airlines and airports are determined
through both EU legislation and legally enforceable Directions
issued by the UK Department for Transport (DfT).
2.5 The DfT's Directions represent a significant
increase in regulation over and above the EU requirement. This
raises the issues of whether the UK provisions represent proportionate
and reasonable regulation relative to EU standards, and whether
the mechanism for determining regulatory fairness is adequate.
Overseas, British Airways must comply with Host State regulation
and is simultaneously obliged to follow the UK DfT's guidance
on measures to be applied to UK carriers overseas. Frequently,
these are mutually inconsistent, resulting in costly duplication
of measures for no significant security benefit. Where there is
no guidance, or adequate regulation, British Airways will implement
its own protective measures, over and above those recommended
by the DfT.
2.6 British Airways believes there is over-regulation
in the UK when compared with security regimes existing in both
Europe and the US in particular. This compromises the competitive
position of the United Kingdom's airlines and airports.
3. GENERAL PRINCIPLES
IN EUROPE
3.1 By definition, international airlines
operate across national boundaries and compete with a large number
of other carriers from around the world. Every country has its
own approach to security and decides on the extent of aviation
security measures to be employed, based on threat, historical
precedent and political imperatives.
3.2 Within Europe, the European Commission
has implemented common standards across airports and airlines,
governed by applicable EU legislation, in an attempt to ensure
a satisfactory platform for aviation security measures and to
ensure the consistency of measures applied. This has raised the
standard of security within the EU to what is widely accepted
as a sound "baseline" level for aviation security measures
for most of the 25 Member States.
4. GENERAL UK
POSITION
4.1 In the UK there are more than 50 additional
measures required by the Department for Transport and Government
to be implemented by UK airlines alone, over and above those stipulated
within EU Regulation (the European "baseline"). There
are further requirements for airport operators.
4.2 These additional regulations are required
to address the prevailing threat against UK aviation interests.
It is contended that the threat in the UK is higher than that
prevailing elsewhere in Europe and as a result, further measures
must be applied. The industry acknowledges this viewpoint, but
believes the threat is higher as a result of the UK's higher anti-terrorism
profile, a function of Government policy.
4.3 To British Airways' knowledge, no Regulatory
Impact Assessment (RIA) has ever been undertaken to demonstrate
that the additional requirements are either proportionate or reasonable
to address the assessed threat. If such an assessment has been
undertaken, its analysis and conclusions have not been shared
with industry, nor was it consulted. We acknowledge, however,
that in some cases, the immediacy of legislative pressures (eg
EU legislation) impedes the DfT's ability to conduct an RIA and
we would like to see EU legislature follow the RIA principles
established in the UK.
4.4 Nonetheless, we believe the perceived
lack of will to use the RIA process runs contrary to the Government's
stated intent to implement regulation that is both fair and reasonable
and which does not overtly disadvantage UK businesses. As far
as we and other UK carriers are able to determine, the Department
for Transport has no financial accountability for the additional
cost burden it places on the industry through the imposition of
additional measures.
5. IMPACT ON
UK AVIATION
5.1 The additional measures are very much
in excess of what the rest of the European airline industry recognises
as "baseline" and currently cost British Airways alone
approximately £10 million per annum.
5.2 There are three consequences of these
extra requirements. Firstly, the cost of implementing these measures
is of great concern, as indicated above. Secondly, there are operational
and customer service implications as a result of the complex implementation
of them. Finally, UK airports and airlines are placed at a competitive
disadvantage vis-a"-vis non-UK airports and carriers.
5.3 Some of the measures, for example passenger
segregation, constitute an operational impediment that cannot
be reversed once introduced, due to the physical and structural
infrastructure changes required.
5.4 At a European level, the costs and complex
implementation of the measures required in the UK reduces the
competitiveness of British international carriers and airports
compared with the major European players such as Air France and
Paris CDG, Lufthansa and Frankfurt and KLM at Amsterdam.
6. SPECIFIC EXAMPLE
6.1 Certain aspects of UK policy, for example
the segregation of all transferring passengers from others, indicate
that the Government's base assumption must be that the security
screening processes applied to passengers originating within Europe
must be suspect and cannot be accepted as sufficiently thorough
for transit within airside areas of UK terminals.
6.2 UK airports and airlines are required
to segregate all arriving passengers and re-screen them, regardless
of the thoroughness of the process applied to the customers at
their point of origin. This also ignores the fact that they have
just completed a flown segment into the UK, probably on a UK-registered
carrier.
6.3 Apart from the UK, no other EU country
requires passengers previously screened in another EU state to
be re-screened again before boarding their aircraft. Segregation
is not required for transfers between flights operating within
the EU.
6.4 The inference is that all arriving passengers
are "unsafe". The logical extension of this is that
all arriving flights are "unsafe", despite being accepted
as safe to fly to the UK. Segregation and re-screening of passengers
has the highest impact in terms of cost and operational impact
that competitors within Europe do not have to bear.
7. GENERAL PRINCIPLES
IN THE
UNITED STATES
7.1 In the United States, the security situation
is even more distorted. The US Government has subsidised security
infrastructure, in addition to the general and direct subsidies
to many US carriers through compensation, loan guarantees and
Chapter 11 bankruptcy protection.
7.2 The US Government in turn reclaims some
of that expenditure through the fees imposed on airlines. These
monies are collected from non-US carriers as well as US airlines.
The fees fund activities such as the deployment of "Sky Marshals",
from which non-US carriers gain no benefit, thus there is an element
of overseas carriers funding the US subsidies.
7.3 The US also imposes additional measures
to be implemented in the UK for flights to the US. They are imposed
on carriers directly by the US Government and are not subject
to agreement with the UK Government, despite the requirement to
apply them at UK airports. Airlines must implement these measures
with which the UK DfT neither agrees, nor recommends. We believe
that any such provisions must be agreed by the UK Regulator, in
line with ICAO recommendations. All costs of such measures are
currently borne by airline operators.
8. IMPACT ON
UK AVIATION OF
ADDITIONAL US MEASURES
8.1 The UK Department for Transport does
not accept US baggage screening standards as satisfactory and
requires baggage flown to the UK from the US to be re-screened
at the point of departure in the US. Hence, British Airways and
other UK airlines must apply further baggage screening at the
airport of origin in the US, in accordance with DfT requirements,
in some cases at the carriers' cost. Baggage is effectively screened
twice using two types of screening technology.
8.2 Despite these additional measures, such
baggage is still not considered acceptable by the DfT for onward
connecting flights from or within the UK without being screened
again. This disregards the fact that this baggage must have been
screened to an acceptable standard to permit flight from the US,
on a UK carrier, into a UK airport.
8.3 Paradoxically, the US authorities do
not accept the UK DfT's screening standards, so all baggage arriving
into the US from the UK, and connecting to other flights at US
airports, has to be re-screened as well.
8.4 Although there are examples of harmonisation
of standards between the EU and US, (eg aircraft certification),
it does not seem possible to reach a reciprocal agreement on harmonisation
of screening or security measures.
9. THE WAY
FORWARD
9.1 British Airways' experience leads it
to the opinion that the UK requires the highest standards of security
anywhere in the world, with the possible exception of Israel.
The higher level of threat faced by UK aviation can be attributed
to Government policy. However, Government has funded none of the
additional security measures required of the industry, despite
the fact that it has imposed additional measures over and above
the European baseline. In some cases, these require duplication
of effort, or are illogical and inconsistent with both EU and
US legislation.
9.2 The airline recognises that it would
be challenging, if not impossible, to regain a level playing field
in a global context. However, it believes that some relatively
simple changes to the regulatory processes applied to aviation
security could provide an element of financial accountability
by the Regulator. This would have the effect of lessening the
burden on industry and providing "value for money" regulation.
9.3 British Airways has proposed, with widespread
industry support, that the measures contained within the European
"baseline" regulations should be industry funded. Additional
measures, imposed by individual countries as a result of an increased
threat due to nationality, must be government funded.
9.4 Under the proposal, all routine legislation
would be preceded by a Regulatory Impact Assessment (RIA), which
would be reviewed after one year. All urgent security legislation
could be implemented without a RIA, but must include a "sunset"
clause, by which time an RIA should be completed in order to make
the legislation permanent.
9.5 Whilst the above would not redress the
imbalance within the EU, it provides a control mechanism that
would offer transparency between the security value created and
the cost. It would also reduce disparity with the rest of Europe.
9.6 The above proposal would be further
enhanced if the Regulatory Impact Assessment took into account
the output from Multi-Agency Threat and Risk Assessment (MATRA)
activities that take place across the UK. This might lead to a
more balanced view of the need for additional regulation, leading
to measures which have been reviewed and are considered reasonable
and proportionate by most of the agencies directly involved in
delivery of aviation security for the industry.
10. CONCLUSION
10.1 British Airways believes efforts must
be made to secure consistency and harmonisation of aviation security
measures with major overseas partners, especially with the USA.
There must be a focus on ensuring the basics are correct, and
which meet the emerging threats and risks as appropriate, rather
than concentrating on closing improbable loopholes by means of
expensive additional measures which lack effectiveness due to
their complexity and lack of credibility.
10.2 In response to a question from Lord
Faulkner of Worcester in the House of Lords, on Monday 10 October
2005 the Lord Davies of Oldham stated that "... the Government
recognise that there is additional funding related specifically
to the issues of terrorism and the safety of passengers and staff,
which necessitates an increased Government contribution. There
has been a contribution over the past year, an increased one over
the coming year, and a three-year projected increase of support
for that necessary expenditure". The transport system
to which Lord Davies was referring was, however, surface transport,
not transport by air. British Airways considers this to be iniquitous.
10.3 Airlines and airports ultimately pay
for all security infrastructure and protection costs for the air
traveller. The cost of the police presence at all of the UK's
major airports, and the security infrastructure, is borne by the
industry. Only at non-designated airports, which tend to be the
smaller, regional sites, does Government fund police coverage.
British Airways looks forward to the outcome of the recently announced
review of airport policing. We recognise that the current process
of "Airport Designation" distorts existing airport operational
costs leading to competitive imbalances even within the four London
airport termini.
10.4 The cost burden on airlines may have
been acceptable in years past but no longer. Given the nature
and extent of the threat prevailing today, and the attendant costs
of security provision, it is unusual that the UK airline and airport
industry has to fund security measures to an extent not seen elsewhere
in the world. The negative impact, both financially and competitively,
is substantial and we urge the Government to reconsider this situation.
December 2005
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