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17 Jun 2009 : Column 74WH—continued
That brings me back to my earlier point. How can Heathrow be the UK’s global gateway if the vast majority of our regional airports do not have access to it? Lack of regulation, and people’s inability to think outside the box, have put us in a perverse situation in which British regional airports are forced to link up with international hubs in Holland and France, while Heathrow, the UK’s global gateway, is used to maximise profits for its Spanish owners. Meanwhile, multinational companies on Teesside
and elsewhere try to reach out to global markets. There may have been some thinking up to where we are now, but I am afraid it has not been joined-up.
Norman Baker (Lewes) (LD): If there were a third runway at Heathrow, which my colleagues do not support—[Interruption.] It would, for the reasons the hon. Gentleman has given, be used for further intercontinental flights with maximum profit for the owners of the airport—[Interruption.] The right hon. Member for North-West Durham (Hilary Armstrong) continually talks from a sedentary position. If she wants to make a speech, she should do so. Would not the third runway simply be used to carry on existing practices, rather than to provide the regional slots the hon. Gentleman wants?
Phil Wilson: Let me continue with my speech and I shall propose how we could prevent that from happening.
Heathrow is a major national economic asset, but it is not available to half the country. The Government’s objectives include improving the economic performance of all English regions and reducing the gap in economic growth rates between regions. How can those aims be achieved if we disadvantage peripheral regions that have world-class industrial sectors, and if we fail to regulate airports to safeguard links to regional airports?
Whole areas of the UK, including Teesside, Yorkshire, the south-west and Wales, cannot access Heathrow and are directly disadvantaged as a result of their inability to gain access to world markets through that major national asset. The draft regulatory framework, which has just been out to consultation, suggests that the answer is a public service obligation, or PSO, but goes on to say, at paragraph 4.48, that
“no applications to impose PSOs on London routes have since been received indicating that regional connectivity is perhaps not such a significant issue, although concerns about regional connectivity are raised with DfT from time to time”.
I suppose that means that debates such as this will be forgotten after they finish, but I want the Minister to know that I will not forget this issue after this debate ends at 11 o’clock.
The same paragraph states that
“we do not believe additional policy interventions, either through the regulatory framework or otherwise, are necessary.”
How many more regional airports must lose their access to the UK’s global gateway before we realise that additional policy intervention is required? The document then discusses
“comments received from the CAA who expressed the view that the maintenance of routes between regional airports and any particular airport should not be an obligation of the regulator. The CAA further noted the Government’s capacity to impose PSOs on specific routes where necessary.”
There should be an obligation on the CAA to regulate to save regional access to Heathrow.
Mr. Carmichael:
The hon. Gentleman is being very generous in giving way. I seek to elicit further views from him on PSOs. Does he agree that the problem, or the reason why there are not applications for PSOs, is to do with the Government’s attitude to granting them? They say that a PSO will be granted only if there is a
risk to the commercial use of a slot, and that as long as a service is operating in a slot, they will not see a commercial risk. So, they will grant a PSO only after the operator has withdrawn, by which time nobody is seeking a PSO.
Phil Wilson: There is a lot of truth in what the hon. Gentleman says, but I shall come to the faults of the PSO system and how they can be remedied.
PSOs are part of the answer, but not the complete answer. I understand that Durham Tees Valley airport is looking at the economics of having a PSO, but there are three parts to the equation. First, the PSO process is bureaucratic; secondly, if successful, it secures only the slots; thirdly, the landing charge system at Heathrow discriminates against regional flights. Those three issues militate strongly against PSOs. If a subsidy is needed to pay for the landing charges, the cost is borne not by the Department for Transport, but by local authorities or regional agencies such as regional development agencies, whose primary purpose is not to subsidise landing charges at Heathrow. That is why no region has successfully pursued a PSO at Heathrow.
There are one or two PSOs in the highlands and islands of Scotland, and in Wales, I think, but there are more than 250 in Europe. To ensure access to Heathrow from peripheral regions and to help their economic development, the Government should regulate to retain regional flights to Heathrow. In addition to the six airports, a minimum of three return flights a day should be allowed from Durham Tees Valley, Leeds Bradford, Plymouth, Newquay, Cardiff and Exeter. That would require 15 slots a day, and would retain regional connectivity to the peripheral regions. That is less than 1 per cent. of Heathrow’s capacity, which has about 480,000 slots.
The Government also need to discuss with BAA and the airlines a commercial tariff that will enable those flights to take place based on the take-off weight of the aircraft. They should also amend the regulatory framework in the interests of the whole UK to improve regional accessibility into Heathrow. The regions expect the Government to ensure that Heathrow can be used by the whole of the UK.
I shall put to the Minister four other recommendations, which are also supported by the Northern Way and the Tees Valley joint strategy unit. First, the regulator’s duties should be expanded to give the Civil Aviation Authority a general duty to promote access to air services throughout the UK from London Heathrow in support of the Government’s commitment to regional growth.
Secondly, using the duty, and recognising that the economic benefits of domestic services contribute to meeting the Government’s wider policy agenda, which is not currently reflected in the airline’s financial benefits at price-regulated airports, regulation should be used to promote a differential in airport charges for domestic services, compared with international services, under overall average yield per cap.
Thirdly, the Secretary of State should use his ability to give direction to the regulator. That is an important tool for shaping the regulatory regime to support, as far as possible, the Government’s wider policy goals, including those related to regional economic development. To avoid the risk of excessive interference from the
Government, I suggest that any draft directions should be published and should be subject to consultation through open process.
Fourthly, I encourage the Government to consider the case for PSO air services on the same basis as other EU member states, taking into account both the social and financial benefits of air services. The potential for air services from Heathrow to regional airports should be further investigated for slot protection through being designated as public service operations. Will the Minister get his civil servants to look again at the draft regulatory framework, and ask them, under his political guidance, to encourage some thinking outside the box? This issue is about more than aviation, airports and airlines; it is about the future economic growth of our regions, selling our goods worldwide and remaining a global player.
It will be the best part of nine or 10 years before the first aeroplane taxis down the third runway. That is a long time, but the issue of providing a decent service from Heathrow to the regions needs to be sorted out now; UK plc deserves that. All I ask for is some joined-up thinking.
Mr. Gary Streeter (in the Chair): Order. Front-Bench speeches will start at 10.30 am. Five colleagues seek to catch my eye, and we have only half an hour left, so if they keep their speeches brief, that will be appreciated. Four people have given notification that they wish to speak, so they will have priority.
9.59 am
Alison Seabeck (Plymouth, Devonport) (Lab): It is a pleasure to serve under your chairmanship for the first time, Mr. Streeter. I also welcome my right hon. Friend the Minister to his new post.
I congratulate my hon. Friend the Member for Sedgefield (Phil Wilson) on securing the debate on an issue of broad interest. As he made clear in his opening remarks, the issue has influence locally, regionally, nationally and internationally. The South West Regional Committee, of which I am Chairman, will carry out an inquiry into transport across the region, which will undoubtedly encompass the role of regional airports.
I have a regional airport in my constituency, and I am therefore aware of the concerns expressed by local residents about the use of the airport and the environmental consequences of air travel. I am also aware of the wide support that the airport received, both from constituents and local businesses. I shall endeavour to express a wide range of views from Plymouth without in any way pre-empting the future investigation of the regional Select Committee, which will hopefully happen in about a month’s time.
I shall begin by talking about the issues that directly affect Plymouth before looking at the wider south-west. From Plymouth’s perspective, air services are generally viewed as fundamentally important to the social and economic strength of our city. That view was clearly expressed by my hon. Friend the Member for Sedgefield in relation to his area. The airport is a key element of the city’s growth agenda, and its continued existence and future growth has been factored into assumptions made about our local economy. It provides—as do all regional airports—vital connections into London.
Air Southwest is the sole airline operating from Plymouth, and it has slots at Gatwick and, most recently, at London City airport, as well as a range of connections to other major cities. However, it no longer has access to Heathrow. There are concerns across the sector that the trend of regional operators losing access to Heathrow could have a detrimental impact on regional economies, some of which are very fragile at the moment. Such concerns are not new. Indeed, as long ago as 1998, the then Environment, Transport and Regional Affairs Committee concluded that because runway capacity in the south-east was in short supply, pressure would be put on regional airports.
I do not want to revisit the arguments for and against the third runway at Heathrow, but the evidence suggests that, without additional capacity in London, economic growth in the regions could be damaged. Offering Amsterdam Schiphol or Charles de Gaulle as an alternative does not work, because of the enhanced range of destinations offered by Heathrow and across London. Serious consideration needs to be given—again, my hon. Friend made this point—to the need to protect regional links into Heathrow as part of any future plans for a third runway and in relation to general capacity issues. As suggested, there could also be a role for the regulator.
To preclude—indeed, to discourage—regional airlines from having access to Heathrow by making the slots extortionately expensive will not help the UK economy, and it certainly will not help the south-west. Despite the environmental concerns, air travel in the south-west is predicted to continue to grow. In a region where the strategic road and rail networks have historically been underfunded and have inadequacies, air travel, whether it involves Bristol, Exeter, Plymouth or Newquay, is essential.
David Taylor: Is it not the case that, economically and environmentally, a far better alternative to having more slots at Heathrow for regional airports is high-speed, affordable and convenient trains, particularly for cities and regions that are within, for example, 500 km of Heathrow? That would encompass the vast bulk of the population of England. Is that not the way forward, rather than having more slots at Heathrow?
Alison Seabeck: I hear what my hon. Friend is saying, but he clearly does not know the south-west very well. Frankly, the idea of our getting a high-speed rail link all the way down to Cornwall is simply not a runner in the medium term. We may get it as far as Exeter or Bristol, but that does not work for Plymouth or Cornwall. We desperately need those regional air links. Cornwall is, of course, an objective 1 area and is one of the poorest regions in the country. Without regional air links, I am afraid that businesses will not come to the far south-west. I understand the environmental arguments, but this is a very difficult issue for our region.
As I have said, road and rail are alternatives, but those in the business community who want to conduct business in London do not have five hours to spare to travel there either by car or train. It takes me five hours door-to-door to get to London. A high-speed rail link would be fabulous, but in the short and medium term that is not going to happen. I want businesses to feel
that they can commute to Plymouth or London for business in a day, without having to rush or be utterly exhausted.
Proposals for a runway extension at Plymouth would allow slightly larger planes to use the airport. That has some very strong support across the city and already much of the land required has been safeguarded. However, I suspect that that proposal is, again, unlikely to go ahead, because the costs run into tens of millions and the pressure on the major funders is likely to make it impossible. Genuine concerns would be raised both by organisations representing residents who live close to the airport—such as the Derriford and Birdcage residents association—and, of course, environmental groups. However, for the reasons that we have heard, regional flying could be less harmful to the environment than mainstream aviation. I am advised that the Dash 8 aircraft currently flying in and out of Plymouth has fuel consumption equivalent to 70 miles per gallon per passenger. Many of those who use that aircraft would otherwise use a car.
Why do we need a vibrant regional airport? Plymouth is one of the drivers of the sub-regional economy and, as I have said, it borders on an objective 1 area. We have unemployment well above the regional level—the most recent figures put it at 5.8 per cent. That is set against the city’s growth agenda, which still has a target of increasing our population by 30,000 in the next 10 to 20 years, as well as increasing employment. To support that growth, there is a determination to encourage inward investment. We have established a city development company which is supported by the regional development agency, and the city council has good links to other local business organisations.
The regional development agency’s strategy in the area is for there to be a developing role for most of the region’s airports, namely Newquay, Plymouth, Bournemouth, Exeter, Staverton airport in Gloucestershire —a much smaller airport—and Bristol. The priority is to address the issue of peripherality, which is why regional airports are so important. The regional development agency also understands the importance of protecting routes into Heathrow and Gatwick by the use of public service orders. Plymouth city council has actively been pursuing the option of trying to get a public service order for Plymouth linking into Heathrow, but, so far, it has failed. My hon. Friend the Member for Plymouth, Sutton (Linda Gilroy) and I have written to Ministers, and I know that the hon. Member for South-West Devon (Mr. Streeter), who is in the Chair today, has also tried to raise the issue through parliamentary questions and other means. We would very much like to have our route protected in that way.
Mr. Carmichael: Was one of the Ministers to whom the hon. Lady wrote David Jamieson? Was she ever disappointed by the response she got from him as a Minister?
Alison Seabeck: The hon. Gentleman should do his homework. Mr. Jamieson was my predecessor, so it would have been a bit difficult for me to write to him.
I know that a number of hon. Members want to speak, so I shall conclude. If the Government are serious about supporting regional economies, they have
to support the infrastructure and links into our regional airports and the regional airports themselves. I look forward to hearing wider evidence on the role of our region’s airports during the Select Committee inquiry and I, obviously, also look forward to hearing the Minister’s response today.
10.7 am
Lembit Öpik (Montgomeryshire) (LD): May I start by declaring an interest? I have been involved on a financial basis with air taxi work. I also declare a deeper interest in relation to the need to have a realistic attitude towards aviation as a whole. There are powerful economic, cultural and political reasons for connecting the world with itself. The most sensible way of doing that is through aviation. Last week, Oxford Economics launched a report called “Aviation: the Real World Wide Web”, which contains some powerful arguments that are often ignored in debates about aviation. Those arguments show that aviation has reduced many problems that we would face if we thought of ourselves in terms of being an individual country, rather than a global village. However, perhaps that is a debate for another time.
We must be realistic about aviation. There is no question—in fact, it is obvious—but that we cannot control demand for aviation simply by limiting the opportunity to fly internationally from the UK. All the evidence shows that flying is aspirational and motivating for almost the entire British population. Fifty years ago, only a small proportion of the population could afford to fly, and that privilege has been opened up to a much wider proportion of people. Indeed, as an island country, if we want to travel, we have to cross water. The Eurostar obviously connects us to France and further afield, but it is not practical to make every journey by train—even if we had high-speed links, which I very much support. Unless we adopt some sort of Talibanesque limitation on people’s right to travel, we have to accept the fundamental reality that aviation will continue to expand.
Mr. Brazier: On high-speed links, if Heathrow were connected directly to the channel tunnel, through which Air France will be running trains from 2012, does that not offer the opportunity to shift many of those using short-haul flights from Heathrow on to the high-speed link?
Lembit Öpik: I agree with the hon. Gentleman and, hopefully, with my hon. Friend the Member for Lewes (Norman Baker), who will summarise the official Liberal Democrat position on these matters. Only a fool would pretend that high-speed rail links are inferior to aviation in terms of economic and practical benefits. The hon. Gentleman is absolutely right. In an ideal world—when the Liberal Democrats take power in 2010—we will support the creation of a high-speed rail link which will, in large part, obviate the need for regional aviation in the UK. It is not a sensible way to transport people on what is a relatively small island.
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