Draft Civil Aviation Bill - Transport Committee Contents


Conclusions and recommendations


Airport economic regulation

1.  We recommend greater clarity in the wording of the bill's definition of users of air transport services. We suggest that users be defined as "passengers and shippers of cargo both present and future". There should also be more specificity in the CAA guidance regarding the relative weight that should be put on current versus future air transport users' interests. We further recommend that the special position of airlines be recognised by way of a secondary duty in the bill. (Paragraph 31)

2.  We recommend that the CAA clarify how it intends to ascertain the interests of transport users and how the proposed Aviation Consumer Advocacy Panel will relate to the regulatory process. (Paragraph 33)

3.  Without giving the CAA a supplementary duty on the environment in relation to its economic regulation role, there is some risk that airports may be reluctant to invest in improving environmental performance. Whilst, as the Minister says, there may be "absolutely no doubt" about measures taken to comply with statutory environmental obligations, there remains a doubt about whether the costs of discretionary measures, such as improved public transport access, can be recovered by airports in charges to airlines. (Paragraph 38)

4.  In our report, Keeping the UK Moving: The impact on transport of the winter weather in December 2010, we recommended that airports be required to develop passenger welfare plans and to provide support to stranded passengers during periods of disruption. We are disappointed that these conditions were not included in the CAA's draft licence and expect them to be taken into account when the CAA sets licence conditions. (Paragraph 40)

5.  We welcome the intention to improve the financial and operational performance of airports. There is a risk, however, that licence conditions, and their associated costs to airports, may not be proportionate to the benefits delivered to the users of air transport services. We recommend that the bill be amended to require the CAA to provide impact assessments for the licence conditions imposed on airports. (Paragraph 43)

6.  Where possible, airport licences should be structured so that they address key areas of passenger dissatisfaction. Immigration and baggage handling are two services which are not within the remit of airports but strongly impact on passengers' satisfaction with airports. If the Government is serious about improving the passenger experience at airports, it should consider, in parallel, how to address improving service standards by other airport service providers, such as UKBA and private baggage handling companies. (Paragraph 46)

7.  We are concerned that airports and airlines might use frivolous or vexatious appeals to delay licence conditions to which they are opposed, to the detriment of users of air transport services. We recommend that the Government ensures that the Competition Commission and other relevant appeals bodies have the power to strike out frivolous or vexatious appeals. We further recommend that the Government specifies more clearly what constitutes a "materially affected" provider of air transport services in the bill, to prevent frivolous appeals by airports and airlines and in respect of "materially affected" persons in relation to appeals on designation. (Paragraph 52)

Reform of the Civil Aviation Authority

8.  We encourage providers of air transport services to be open and transparent in relation to matters of concern to service users, the local community and the wider environment. We are concerned, however, that the provisions in clauses 80 and 81, granting powers to the CAA to require publication of consumer and environmental information, are too widely drawn. They risk creating bureaucracy and additional costs to the aviation industry while the benefits are less tangible. We recommend that the Government specify the types of transport service provider and information to be brought within these provisions. We also recommend that the bill make clear that publication requirements should not create disproportionate burdens for the aviation industry and that the CAA be required to demonstrate the value to passengers. (Paragraph 61)

9.  We recommend that an explicit efficiency duty for the CAA be inserted in bill. The Government should explain why the CAA is, apparently, unique among industry regulators in being outside the remit of the National Audit Office. (Paragraph 64)

Aviation security

10.  We are concerned that the decision to transfer aviation security regulation functions from the DfT to CAA was included in the draft bill at a late stage and not subject to consultation. The Government needs to explain to the CAA, the aviation industry and others the detailed division of security responsibilities and how it would operate in the public interest before the bill reaches committee stage. (Paragraph 71)

11.  It is important that the CAA has sufficient security expertise to undertake its new role. The DfT and CAA should investigate employment arrangements, possibly including secondments rather than transfers, to avoid losing experienced staff and expertise in the transfer of posts from the DfT to the CAA. (Paragraph 73)

12.  There is a danger that the aviation industry will incur the additional costs of security regulation but not the savings that may come from the proposed introduction of the outcomes-focused risk-based (OFRB) security regime. It will require a pro-active approach from Government towards EU aviation security policy. The Department for Transport must do more to reassure the aviation industry that the potential benefits from an OFRB regime will be delivered, to offset the additional costs that it is imposing. It should also publish an explanation of how the proposed changes to security regulation will be more efficient while maintaining high levels of aviation security. We further recommend that the transfer of security staff and costs is timed to occur with the introduction of the OFRB regime. (Paragraph 80)

Conclusion

13.  The UK needs a healthy, competitive and sustainable aviation industry, which includes regional airports and air services. The bill provides new powers for the CAA to undertake its regulatory roles, and some new duties. The aviation industry has some concerns about the way in which the CAA will implement some of these provisions. Given the greater degree of competition that now exists between airports in the south east of England and the difficult business conditions facing many regional airports, we are clear that the CAA should undertake its economic regulatory duties with a relatively light touch. We believe this would be consistent with the Government's better regulation principles and with what the Government would expect of the CAA. The Government should be open to proposals and suggestions for amendments to the bill to reinforce this principle. (Paragraph 84)



 
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Prepared 19 January 2012