Aviation Strategy

Written evidence from Unite (AS 64)

1 Introduction

1.1 This response is submitted by Unite the Union, the UK’s largest trade union with 1.5 million members across the private and public sectors. The union’s members work in a range of industries including manufacturing, financial services, print, media, construction, transport, local government, education, health and not for profit sectors. The Civil Air Transport (CAT) membership of Unite comprises of over 62,000 members working across the aviation sector making it the largest single organisation in the aviation industry.

1.2 In this response Unite intends to stress the importance of aviation growth and the urgent need for a comprehensive transport policy encompassing all transport modes to cope with future demand.

2 Enquiry questions

1. What should be the objectives of Government policy on aviation?

a. How important is international aviation connectivity to the UK aviation industry?

2.1 A regional or point-to-point airport only serves the local community it resides in either providing low frequency direct flights or feeding connections to hubs. Point-to-point airports can only offer direct flights to destinations if they can be sustained by local demand. Consequently, the frequency of these flights will be low, limiting access to that destination. A point to point like Manchester is large enough for more frequent services which has attracted a limited demand for transferring passengers, making some additional flights possible on popular routes. A hub, on the other hand, survives by offering multiple daily flights to a variety of destinations, as the customer base is derived not just from the locality but also the global aviation industry [1] .

2.2 In terms of what benefits international aviation brings to the UK industry it is simply access to this wider customer base. The same would be true regardless of nation. One has also got to remember that the UK aviation industry is becoming increasingly multinational with bases in several countries.

b. What are the benefits of aviation to the UK economy?

2.3 It has been estimated by Frontier Economics that direct aviation connectivity produces twenty times more business than a connection that requires a stop over at a hub [2] . Oxford Economics highlighted in their report which came out in March [3] that, by volume, 65 per cent of international air freight going through UK airports in 2010 went via Heathrow. This freight is primarily carried in the hold of passenger aircraft, making the cost of a ticket that much more affordable. Oxford Economics also estimated that the manufacture of goods for export by air contributed £28 billion to UK GDP. They suggest that rather than just supporting the 100,000 or so staff employed at Heathrow, the airport was responsible for supporting 1.3 million jobs in throughout the UK.

2.4 The aviation industry opens up markets to the global economies, especially those in the BRIC [4] developing nations, for UK goods and services. This in turn creates the potential for investment into the UK. Having good onward transport connectivity also attracts multinational businesses, keen to base their regional head offices in the area around hubs. If this connectivity becomes unreliable or cannot provide the range of services needed, then these businesses will relocate to somewhere that can cope, taking their inward investment with them.

c. What is the impact of Air Passenger Duty on the aviation industry?

2.5 The principal effect of Air Passenger Duty has been the evaluation of the viability of services to the UK. This combined with the additional cost of carbon credits needed to fly to any European nation under the European Emissions Trading Scheme (ETS) has already resulted in the break up of the deal between Qantas and BA. Qantas has now entered an agreement with Emirates and moved operations from Heathrow to Dubai. Another example of this is the threat by Continental to stop calling at Belfast due to the £3.2 million in additional costs per annum between calling at Belfast compared to Dublin.

2.6 Passengers are catching ferries out of the country so that they can fly from Amsterdam to India [5] , and who can blame them when it costs £286 for a car and eight passengers return via Harwich and the Hook of Holland when the APD alone would be a minimum of £664. For those in the west of the country it costs £578 for the same part to go from Holyhead to Dublin from where air passengers would only have to find €3 ahead.

2.7 Unite believes that by increasing APD, the ability to fly out of the UK is becoming the preserve of the rich. It also moves the holiday in the sun out of reach for hard pressed workers who have been suffering from below inflation increases or wage freezes. Whilst Unite believes this will result in more holidays taken at home, it reduces the number of tourists entering the country. A study by Malaysia Airlines into price sensitivity of airline tickets highlighted that a difference of just $2.50 was enough for a customer to choose one flight over another. Such price sensitivity means that by adding APD, the UK is actively discouraging passengers to visit the UK and trade with us.

d. How should improving the passenger experience be reflected in the Government’s aviation strategy?

2.8 Unite agrees that a lick of paint can make an airport far more welcoming than allowing facilities to fall into a state of disrepair. Real improvements in passengers experience can only be effective, however, if the airport can provide a safe reliable flight which departs and arrives on time. This cannot be guaranteed currently at Heathrow, due to the lack of spare capacity in the system. Unite believes ‘Heathrow hassle’ as it has become known, has lost the UK untold amounts of business. Consequently, if the policy is one of improving capacity and reliability, the passenger experience will follow. Unite also believes a hassle free journey to and from the airport is also critical to ensuring that the best passenger experiences.

e. Where does aviation fit in the overall transport strategy?

2.9 Aviation fits into an overall transport strategy by providing rapid long distance travel opportunities to places out of reach of surface transport options. Over medium haul distances aviation can provide connectivity to destinations within hours which would take days to reach by rail or road. In relation to short haul the role may be in competition with high speed rail, but can on occasion provide a solution which produces fewer emissions [6] . Where terrain dictates a longer journey like between Manchester and Copenhagen, it may be the case that the journey by high-speed rail would take far longer [7] and produce far more emissions than flying. On domestic trips, aviation has a critical role to play connecting communities which would have difficulty via any other option, especially in Scotland where it provides the lifeline to the island communities. Consequently, aviation should be viewed as an integral part of the public transport network.

2. How should we make the best use of existing aviation capacity?

a. How do we make the best use of existing London airport capacity? Are the Government’s current measures sufficient?  What more could be done to improve passenger experience and airport resilience?

2.10 Given the nature of hub activities in needing to provide a seamless transition of passengers from one flight to the next, it is difficult to see how this can be improved by connecting London airports together by high speed rail connections. The delays caused by passengers transiting from Terminal 3 to Terminal 5 at Heathrow already affect scheduling and this is no more than 15 minutes. Equally, assigning an airport to a particular sector in terms of the industry would not work either given the need for passengers from domestic flights to connect with others flying short, medium or long distances; short haul passengers also desiring a connection to domestic, medium and long haul etc.

2.11 Dictating that short haul and domestic flights should not call at the hub will cause serious problems for regional communities. Lack of connectivity to a hub, or other major London airport, limits demand for onward connectivity. Key examples are the closure of Plymouth following the loss of the Gatwick service and the threatened closure of Durham Tees which followed the decline in passenger numbers from 940,000 in the year to July 2006 to 167,000 in the twelve months to July this year [8] due to the loss of a connection to Heathrow. This has caused the airport to loose £2 million in their last reported financial year putting its future at risk.

2.12 Non connecting point-to-point services flying out of Heathrow only benefit from being able to capture market share on routes for domestic customers and those who decide to self connect. These point-to-point flights could be accommodated at an alternative London airport. Such a move would require governmental control of slot allocation given the value of these slots on the open market [9] .

2.13 Providing internal flights to a domestic hub is controversial as there are much less polluting ways to travel domestically. If these regions were offered a low carbon alternative to aviation, which allowed near flight level travel times, comfort and connectivity, then there would not be the need to provide the connection by air. This can clearly be illustrated by looking at the successful replacement of flights between Madrid to Barcelona [10] . The same could occur between Manchester [11] or Leeds and Heathrow once the HS2 line is completed, if the line connects to the hub in the first stage.

2.14 Where the distance or terrain dictates and a flight is necessary, why does this connection have to be provided by a jet powered aircraft? A turboprop engine is more fuel-efficient than a jet. For flights of less than 500 nautical miles the use of turboprop powered aircraft becomes the most cost-effective and environmental way to fly as they use less fuel. In fact, some turboprops can use up to 40 per cent less fuel with an equal reduction in emissions [12] .

2.15 In the short term the use of Mixed Mode could provide some growth if the infrastructure was developed to allow departures towards the East from the northern runway at Heathrow. Whilst this would provide some additional capacity and resilience in the very short term it would cause the removal of respite from over flights and noise for local residents.

b. Does the Government’s current strategy make the best use of existing capacity at airports outside the south east? How could this be improved?

2.16 Unite would argue that there is currently no workable Government aviation strategy other than one which suggests you can fit a pint into a quart pot. Current capacity outside the south east is sufficient to cope with current demands and those placed upon it in the short term. In the longer term there will be the need to expand Manchester, Birmingham, and either Glasgow or Edinburgh to cope with regional demand.

c. How can surface access to airports be improved?

2.17 Diversion of the HS2 route via Heathrow in the initial phase could provide some additional connectivity as highlighted earlier by offering an alternative to aviation. By doing so some of the connecting flights to Manchester could be replaced as could flights to Brussels, Paris and Lyon. This can clearly be illustrated by looking at the successful replacement of flights between Madrid to Barcelona [13] . The same could occur between Manchester [14] or Leeds and Heathrow once the HS2 line is completed, if the line connects to the hub in the first stage. Moving the route to the west would also have the added benefit of going through a far narrower part of the Chilton’s.

2.18 Unite supports the Airtrack Lite [15] proposals to build a link between Heathrow Terminal 5 and Staines which would enable passengers to better access the hub from the South avoiding the need to pass through central London. Such a connection would also enable passengers from Wales and the West Country to access Gatwick if the connection is built from the Great Western line.

3. What constraints are there on increasing UK aviation capacity?
a. Are the Government’s proposals to manage the impact of aviation on the local environment sufficient, particularly in terms of reducing the impact of noise on local residents?

2.19 On point to point services the main constraint is the ability of an airline to attract customers for the service in the locality of the two airports between which the service will operate. In terms of hub operations the constraint should be environmental in terms of limiting the growth of emissions to what is sustainable.

2.20 Unite believes that noise management is a double edged sword in that by combating noise it will often result in more greenhouse gas emissions. There are measures such as the use of continuous descent that can reduce both but in the main the decision has to be made whether the industry concentrates on reducing fuel burn and emissions or noise.

2.21 Current proposals to maximise the use of existing facilities removes the respite currently enjoyed by residents from over flights by using runway alternation and require flights to arrive over a longer period during the day should there be an incident which disrupts normal operations. If the capacity provided by a third runway or a new hub was constructed, such respite provision could return and as long as this capacity is not fully utilised disruptions could be resolved far sooner. Consequently, Unite believes that whilst a larger area would be affected by noise pollution the effect on the individual would be a reduction in noise.

b. Will the Government’s proposals help reduce carbon emissions and manage the impact of aviation on climate change? How can aviation be made more sustainable?

2.22 Unite believes that the reverse is true. Providing additional capacity reduces unnecessary fuel burn while queuing both on the ground and in the air if it is not fully utilised. Figures from Boeing on fuel burn per minute highlights that for every minute a jet aircraft is on the ground it is burning the same amount of fuel as it does during up to ten minutes at cruise altitude. Attempting to squeeze even more flights out of the existing infrastructure will only result in more emissions. There are a number of measures that can make aviation more sustainable but the simplest in terms of government policy is to provide enough capacity to allow aircraft to land immediately on arrival at an airport and depart directly after leaving the gate. Electrically powered tugs to stop jet engines being used during taxiing would also reduce emissions and pollutants, making the working environment for employees better. Limits on flight numbers based on total emissions would limit increasing the carbon footprint and drive the industry toward being even more sustainable.

c. What is the relationship between the Government’s strategy and EU aviation policies?

2.23 The EU promotes a 40 per cent replacement of Jet A1 aviation fuels with sustainable alternatives. The Committee on Climate Change based their findings on a 10 per cent figure. Europe also appears to support its aviation industry, recognising the benefits it brings, whilst successive government policies suggest we do all we can to prevent the industry being successful.

4. Do we need a step-change in UK aviation capacity? Why?
a. What should this step-change be? Should there be a new hub airport? Where?

2.24 As outlined previously the idea that you can get a better aviation industry without expansion is farcical. As commercial enterprises the industry is already trying to work within government limitations to maximise passenger load factors and increase profit. Unite believes that the government needs to get behind airport expansion now and needs to fast track the planning process for these facilities to make up for the years of debate over this subject if we want UK plc to be competitive.

2.25 Fears that having spare capacity would encourage the industry to fill this capacity to the limit again can be overcome by limiting air traffic movements by imposing limits. Legislation which ties together flight numbers with emissions would promote the use of more fuel efficient aircraft, which in turn would reduce global aviation emissions on flights destined to travel via Heathrow and other UK airports.

2.26 Given the limitations of the Heathrow area in the longer term a new centralised hub is needed to cope with demand from 2050 on with the space to expand further. NATS has identified that the problem with the airspace over London and the South East is the complexity due to the number of existing airports and aerodromes. If a new hub is created it will need to consolidate the flows through at least two airports as well as provide additional capacity. Unite believes the ideal location would lie to the West of London along the M4 corridor no more than 48km from Central London to minimise the disruption to the workforce demands needed to staff such a facility and service the business communities of the region. Unite would, however, support any workable proposal at this stage given the plight of the industry.

b. What are the costs and benefits of these different ways to increase UK aviation capacity?

2.27 Unite does not have the resources to provide such an analysis but believes that a three stage approach beginning with the adoption of full mixed mode operations, while a third runway is constructed culminating in the opening of replacement new hub. Both of these initial stages would not cost the tax payer one penny as the costs have been already allocated by the private sector. The major expense will come with the construction of a new hub airport which would need a minimum of four parallel runways to be viable but Unite believes it should ideally have six.

2.28 Whilst it may be possible to utilise the land around RAF Northolt as an alternative, this would need to be combined with a high speed connection to the existing terminals at Heathrow from airside to airside. This may be possible if the proposal by Heathrow Hub Ltd is extended to forge a link between it and Northolt. Such a proposal would require the creation of a new runway on land adjacent to the current footprint of the airport to align it with those of Heathrow. Such a proposal would require extensive tunnelling to make this work which would be far more expensive than the third runway idea. Additionally, such a solution would increase connection time between terminals which in turn would heavily effect scheduling.

2.29 It is clear that the long term future of Heathrow post 2030 is in doubt unless government intervention finds a legal way of preventing aircraft using the airport as a hub post the creation of its replacement.

3 Conclusion

3.1 Unite hopes that whatever proposal is finally decided upon, that such a proposal is constructed as soon as possible and not delayed by government and legal red tape. Unite believes that if it takes a further 20 years to get a new hub open and running, it will probably be too late to save the future of the UK aviation hub.

3.2 Istanbul is now building a five runway hub airport which will exploit its geographic location to maximise flows from Russia, China, the Middle East, India and Europe which will be open in just four years. As Turkey is outside the European Union, flights to Turkey do not face the burden of having to pay for carbon credits for every tonne of carbon produced and is close enough to the East Coast of America to enable direct narrow body high frequency flights. In short, if the UK does not invest in new capacity it runs the risk of being left on the sidelines by Turkey and others inside Europe.

3.3 The lessons learnt from the construction of Montreal Mirabel airport should not be ignored and whatever is built needs to have enough supporting seamless intermodal surface connection options to make the journey from home to destination as stress and hassle free as possible.

19 October 2012