Transport CommitteeWritten evidence from Bristol Airport Limited (AS 55)

Executive Summary

1. The UK economy remains in the midst of the worst economic recession since the 1930s. Businesses across the country, particularly in the regions, are struggling with stagnant demand and cost increases. In response, the Coalition Government has announced many initiatives to foster job creation and economic growth. But the aviation industry, a key driver of the economy, has been stalled and left in a policy vacuum.

2. The Government’s Draft Aviation Policy Framework fails to deliver a bold, new vision that will encourage the aviation industry to invest in the UK. Furthermore, an Independent Commission has now been called to consider hub capacity, but will not report until 2015.

3. Meanwhile, Bristol Airport is preparing to invest millions of pounds in enhancing its facilities and improving services to customers, with planning permission in place for development to handle 10 million passengers per annum within the next decade.

4. Government policy should enable airports in the regions to more effectively serve their local markets by making the best use of the significant capacity available outside the South East. Our recommendations for policy actions to support this vital sector in achieving this objective are outlined below:

The introduction of a lower regional APD rate based on airport congestion. This would have the effect of rationalizing the use of UK airports according to capacity available and help overcome the natural advantages enjoyed by the London airports, and Heathrow in particular, over their counterparts in the regions.

Government and its agencies have a direct effect on the passenger experience at security and at the UK Border. The Government’s aviation strategy should go further and play a greater part in generating improvements in these areas.

Aviation should sit within an integrated transport policy which includes improvements to the rail network. Modal substitution cannot be relied on to replace domestic flights from regional airports.

Aviation policy must provide clear support for specific growth proposals at airports in the regions. By encouraging demand to be served in the region in which it arises a policy framework which supports regional airports will also help deliver benefits to the London airport system.

Government policy should prioritise transport proposals that would deliver short, medium and long-term improvements in surface access to airports outside London in order to drive economic growth in the regions.

A one size fits all approach to approach to environmental management is not appropriate. The approach at regional airports should be resolved at a local level within a framework of national high level policy guidance.



5. Bristol Airport Limited welcomes the opportunity to provide written evidence to the Transport Committee’s inquiry into the Government’s aviation strategy.

6. Handling six million passengers per annum Bristol Airport is the ninth largest airport in the UK and the fifth largest outside London. Located just eight miles south of Bristol in rural North Somerset, Bristol Airport serves one of the UK’s premier city-regions with a population of 1.1 million people living within the four council areas that make up the West of England (Bath and North East Somerset, Bristol, North Somerset and South Gloucestershire).

7. Bristol Airport’s catchment area extends far beyond the West of England into the wider South West region and South and West Wales, with a population of around 7.5 million people living within a two-hour drive time of the Airport. Passengers travelling to and from Swansea, Cardiff, Cornwall, Devon, Somerset, Wiltshire, Gloucestershire and Dorset pass through the Airport in increasing numbers.

8. The mix of outbound leisure passengers, inbound tourism and business travel supports a route network at Bristol Airport which includes over 100 direct destinations in 30 countries, including 13 capital cities. Ten departures a day connect with the worldwide Star Alliance and SkyTeam airline networks via the European hub airports of Paris Charles de Gaulle, Amsterdam and Brussels, bringing hundreds more destinations worldwide within easy reach.

9. A diversified range of leading airlines in the low cost, full service and charter markets operate from Bristol Airport, including easyJet, Ryanair, KLM, Air France, Brussels Airlines, bmi regional, Aer Lingus, flybe, Aurigny, Eastern, Blue Islands, Skybus, TUI and Thomas Cook.

10. Plans for the development of Bristol Airport to handle up to 10 million passengers per annum were approved by North Somerset Council in February 2011. The development commenced in November 2011 and the first of more than 30 separate projects—the construction of three new aircraft stands—was completed in spring 2012.

11. The development plan includes challenging public transport targets which will see public transport use increase threefold. This will be achieved through continued investment in the successful Flyer Airport Express bus service linking the Airport to Bristol city centre, including the main rail and bus stations, and the development of an expanded public transport network serving Weston-super-Mare and Bath.

12. Bristol Airport is a member of the Airport Operators Association (AOA) and supports and endorses their evidence to the Transport Committee’s Inquiry.

Importance of International Connectivity

13. In general we agree with the Government’s conclusions on the value of connectivity as set out in the Draft Aviation Policy Framework. We are pleased that Government has recognised the social benefits of leisure travel but we believe that the importance of these benefits has been understated. Leisure travel encompasses a wide range of journey purposes including visiting friends and relatives, educational trips, cultural exchanges and sport. The number of overseas visitors using Bristol Airport has increased threefold since 2003 with international tourists staying twice as long and spending over three times more than their domestic counterparts1. Bristol Airport has also seen a significant increase in travellers visiting friends and relatives with a sevenfold increase between 2000 and 2008, the largest increase seen at any UK airport over the same period.

14. Connectivity is not evenly distributed across the country. An integrated aviation policy is required that not only delivers hub capacity, but also ensures that connectivity in the UK regions is boosted by the provision of additional capacity, promoting economic growth and rebalancing the economy.

15. The AOA has provided evidence concerning the economic importance of international aviation in their submission to the Inquiry. Bristol Airport plays a vital role in the economic success of the South West, with its development projected to create more than 3,500 additional jobs in the region. Development will also deliver additional income to the region estimated at between £1.9 and 2.0 billion over the life of the project.

Air Passenger Duty

16. The Government has stated its aim to rebalance the economy, pledging to share economic opportunities more evenly between the regions, and the Draft Aviation Policy Framework acknowledges the important role played by regional airports. However, London airports, and Heathrow in particular, enjoy a number of natural advantages over their counterparts in the regions. The City of London sustains a lucrative market for business travel, while London itself is the country’s most popular tourist destination by far, with ten times more visits by overseas tourists than the next ranked city, Edinburgh.

17. Start-up routes from regional airports are much harder to secure and take longer to mature as they cannot rely on the level of inbound and business traffic generated at London airports. As a result, additional costs such as Air Passenger Duty (APD) have a disproportionately damaging impact on regional airports (increases in APD were cited by Continental Airlines as a factor in the withdrawal of its daily service from Bristol to New York in November 2010).

18. At the same time, the price elasticity of demand for air travel is becoming increasingly high, particularly in the low cost leisure market. Consumer behaviour is very sensitive to price differentials, even more so in the regions where disposable income is lower and airlines often operate on thinner margins. The largest carrier at Bristol Airport, easyJet, made an average profit per seat of £3.97 across its network in 2011, compared to the £13 in tax charged on passengers taking shorthaul flights.

19. These factors combine to create a “Heathrow effect” where airlines retrench to what is seen as the safest market in difficult economic conditions. Rebalancing this effect could be achieved through the introduction of a lower regional APD rate based on airport congestion. This would have the effect of rationalizing the use of UK airports according to capacity available, as part of an aviation policy providing clear support for growth in the regions.

Passenger Experience

20. Regional airports, such as Bristol, deliver a simple and efficient passenger-friendly experience which the main London airports find difficult to emulate due to their scale. As a result, Bristol Airport enjoys high customer satisfaction levels, with 84% of passengers indicating in passenger surveys that they are likely or very likely to use the Airport again. 87% of those surveyed said they were likely or very likely to recommend Bristol Airport to others. This level of satisfaction has been achieved through continuous investment in passenger facilities and an emphasis on customer service through our brand promise “Amazing journeys start here”.

21. Issues relating to the arrangements for security regularly appear in the top three concerns raised by customers using Bristol Airport. Comments relating to the arrivals process and immigration facilities also feature in passenger feedback. These are two areas where Government and its agencies have a direct effect on the passenger experience and Government’s aviation strategy should go further and play a greater part in generating improvements. The UK’s Border Agency targets of queue times of no longer than 45 minutes for non-EEA nationals, or 25 minutes for EEA nationals are not acceptable and need to be more ambitious. In the area of passenger security, progress towards Outcomes Focused Risk Based Regulation has been slow. Government must put in place a plan and resources to deliver these improvements and also take the opportunity to review security measures in place at UK airports making sure that they are harmonised as far as possible with the rest of Europe.

Aviation within an overall Transport Strategy

22. Road and rail would be the first choice transport modes for journeys of two to three hour duration. Beyond that aviation provides the most efficient form of transport between major city pairs. For example, there are no air services between Bristol and London, or Manchester. Our domestic route network has now stabilised within the UK mainland with regular daily services to Leeds, Newcastle, Glasgow, Edinburgh, Aberdeen and Inverness, destinations that are not attractive by rail. Whilst the attractiveness of rail for longer distance journeys might increase with further development of the UK’s high speed rail network, this will mainly favour journeys into and out of London. There is no prospect of a high speed rail network reaching the South West and Wales in the foreseeable future and aviation will continue to provide the main means of connecting Bristol with the North of England and Scotland.

23. The rail network plays an important role in connecting airports with their hinterland. An integrated air and rail transport network is therefore required. Electrification of the Great Western Mainline will bring much needed improvements to the rail network serving the South West and Wales, including improvements to surface access to Bristol Airport.

Making the best use of existing London Airport Capacity

24. Despite the growth of Bristol Airport’s route network and much improved facilities many passengers from the South West and Wales still continue to use the London airports. The CAA Passenger Survey indicates that, in 2011, 6.1 million passengers with an origin or destination in the South West or Wales flew from the London airports (primarily Heathrow and Gatwick), over half of whom were travelling to short haul destinations. This constitutes the largest leakage from one UK region to another. Bristol Airport’s objective is to encourage an increasing proportion of these passengers to make use of services from their local airport saving time, cost and carbon emissions. Consistent with the Government’s aim to make best use of existing capacity by “clawing back” the leakage of millions of these passengers, Bristol Airport can free up capacity for vital new long-haul services from the capital. With planning permission in place for a major development alongside an expanded route network, Bristol is focused on better meeting the needs of passengers across its catchment area. By encouraging demand to be served in the region in which it arises, a policy framework which supports regional airports will also help deliver benefits to the London airport system.

25. Bristol Airport is ideally located to serve international visitors to popular tourist destinations including Stonehenge, the World Heritage City of Bath, the Cotswolds, Devon and Cornwall. The Government’s tourism strategy should encourage international visitors to use airports in the regions as gateways to the UK. The proximity of regional attractions to local airports with access to international connections should be highlighted in marketing materials promoting the UK overseas. Priority should also be given to airports outside London when considering initiatives, such as US pre-clearance, which would increase their appeal to international passengers. Similarly, where this would provide benefits to inbound passengers, Government agencies should consider piloting other innovative technology and processes at airports in the regions.

26. Flying from regional airports remains the most logical, efficient and cost-effective way of dealing with customers and clients for many businesses. Private and public sector organisations should be encouraged to revise travel policies to, where possible, favour the use of airports in the region in which they are located. This would deliver a combination of time, cost and emissions savings, while also relieving congestion at London airports. Government should also address the anomaly whereby passengers on domestic flights linking far-flung regions of the UK pay double the tax of those making return trips to destinations in other European countries.

Making best use of Existing Capacity

27. In order to deliver the forecast growth in UK air passengers and spread the benefits of connectivity more evenly across the UK, aviation policy must provide clear support for specific growth proposals at airports in the regions. Airport development proposals create wide ranging benefits but planning committees face a difficult task balancing local impacts with national and regional benefits. Without an explicit Government policy directive, critical decisions affecting regional economic growth risk becoming bogged down in local planning disputes. Action is also required to make best use of existing capacity outside London. While it is airlines who decide which routes are operated from which airports, a range of policy levers and fiscal measures (such as regional variations in APD) should be employed to ensure best use is made of existing airport capacity.

Improving Surface Access to Airports

28. Surface access is sometimes identified as a barrier to development at regional airports. To address this, over £10 million has been committed by Bristol Airport to public transport projects, including contributions totalling £5.4 million to the South Bristol Link and Bus Rapid Transit, two of five major transport schemes in the West of England. These schemes will facilitate a more attractive, reliable, efficient and frequent public transport service between Bristol Airport and Bristol city centre, providing improved services for passengers and widening employment opportunities.

29. Instead of focusing already stretched budgets on a £500 million rail link from the South West to Heathrow, which will only serve to increase pressure on the London airport system, transport funding should be focused on further improving access to airports in the regions. As well as contributing to economic growth, schemes such as the Greater Bristol Metro, Great Western Main Line electrification, and the regeneration of Temple Meads station will all have a positive impact on surface access to Bristol Airport, as will the extension of the Bus Rapid Transit route to the Airport in 2015–2016.

30. By contrast, a Heathrow link risks poor returns because of the relatively dispersed population in the South West. Such a link could also serve to exacerbate capacity problems in the South East and hamper the ability of regional airports to attract new long-haul routes. This potentially undermines the significant private sector investment made in regional airports such as Bristol, further entrenching a “Heathrow-centric” approach. Priority should be given to improving surface access to airports outside London to extend the catchment areas in which they can compete for passengers, reducing leakage between regions and easing congestion in the South East.

31. Government policy should prioritise transport proposals that would deliver short, medium and long-term improvements in surface access to airports outside London in order to drive economic growth within the regions. Links to nearby airports should be a key consideration when assessing applications for funding of new transport schemes, and integration of rail and air services must be central to the assessment of rail franchise replacement bids. The scope of the Department for Transport’s review of rail access to airports should be extended beyond those airports named in the Draft Aviation Policy Framework and widened to include road transport.

Managing the Impact of Aviation on the Local Environment

32. Bristol Airport is one of the most environmentally efficient airports in the UK and is well able to respond to the challenges on noise and other environmental impacts set by Government in its Draft Aviation Policy Framework. Noise mapping exercises show that Bristol Airport has the lowest noise impact of any airport in England and Scotland handling over one million passengers per annum.2

33. It is clear therefore that experiences at the larger airports in relation to noise, for example, cannot be compared with the situation at Bristol. It follows that a “one size fits all” approach to noise management would not be appropriate and in general the approach at regional airports should be resolved at a local level within a framework of national high level policy guidance. Increased regulation is not required.

Aviation’s Impacts on Climate Change

34. Bristol Airport supports the Government’s overall approach. The EU ETS should be seen as a stepping stone on the way to an overall global approach. It is important that the scheme should succeed and Government should work at EU level to ensure that the risk of retaliatory action and non-compliance is properly managed, if necessary by revising the scope of the scheme. The UK should continue to take a leading role to secure progress within ICAO and the EU.

35. Aircraft operating at regional airports generate lower emissions associated with ground movements and the landing and take-off cycle as a result of short taxi distances, no stacking and efficient operations in uncongested airspace. Policy measures to encourage the use of regional airports will ensure that maximum opportunity is taken to deliver operational savings.

Need for a Step Change in UK Aviation Capacity

36. As politicians, Government officials, aviation professionals and other stakeholders debate issues around capacity and new schemes costing billions of pounds, it is critical to remember that significant airport capacity already exists in the UK regions. Government policy should encourage the use of this capacity, and should encourage private sector investment in long-term infrastructure. Not only will this relieve congestion at airports in the South East, but it will help to rebalance the economy at the same time. Like many airports outside London, Bristol Airport is very well placed to create jobs and drive economic growth in its region. What we need is a very clear and very tangible aviation policy which supports growth and investment.

19 October 2012

1 The UK Tourist 2010 and Visit Britain inbound visitor statistics.

2 Measured by the number of people exposed to noise levels in excess of 55dB Lden.

Prepared 31st May 2013