The Secretary of State for International Development (Mr Andrew Mitchell)
The Government recognise their special responsibilities and international obligations towards their overseas territories, and are committed to supporting their economic development. We want to provide a permanent, economically viable solution to the problem of access to St Helena. This is in the long-term interest of both the British taxpayer and the citizens of this overseas territory.
St Helena is one of the most remote inhabited islands in the world and is currently accessible only by sea. In 2005, the previous Government committed themselves to building an airport. They put the project out to tender in 2007. In October 2008, they appointed a preferred bidder and commenced contract negotiations. Two months later they “paused” the project. In 2009 the Government set up a further consultation on “whether an airport is the most appropriate option for access to St Helena in the current economic climate”.
Should an airport not be built, HMG would have to spend an estimated £64 million on a new ship, because the current vessel is reaching the end of its economic life, and continue to subsidise its operating costs. St Helena would stand little chance of becoming financially independent, meaning it would permanently rely on substantial annual budgetary and other support from HMG (currently in excess of £20 million every year). A new ship would provide a costly service but not a solution to St Helena’s stagnation and perpetual dependence on UK-aid support.
It also appears that airport cost reductions can be achieved by reducing the length of the runway run-on using an Engineered Material Arresting System (EMAS). This shorter run-on still allows planes to stop safely after reaching the end of the runway itself. This is a technological advance in air safety, which is already in use in airports around the world but which has yet to be approved by Air Safety Support International, the regulator for the UK overseas territories.
Since taking office, the Government have reviewed the economic costs and benefits of a new ship compared to the construction of an airport. Further independent analysis has concluded that, provided certain conditions are met, the best long-term solution from an economic and financial perspective for both HMG and St Helena is to construct an airport. This would allow us over time to eliminate the cost to HMG of servicing access to the island, to create the potential for St Helena to develop a self-sustaining economy (hence, eliminating the need for budgetary support from HMG) and to provide a permanent solution to economic isolation.
I have therefore reached the provisional conclusion, following careful discussion with Her Majesty’s Treasury and the Foreign and Commonwealth Office, that the additional short-term costs of constructing an airport are outweighed by the long-term benefits. So, I believe that this option is likely to represent the best value-for-money for the British taxpayer.
We would therefore be willing to finance an airport for St Helena on condition that:
an acceptable contract price is achieved;
the risk of cost and time overruns after the award of the contract is addressed;
the airport design using EMAS is approved by Air Safety Support International: and
the St Helena Government undertake to implement the reforms needed to open the island’s economy to inward investment and increased tourism.
We will make a further announcement once we are satisfied that the above conditions can be met.