Blackpool Airport
(10 years ago)
Commons ChamberRead Hansard Text Read Debate Ministerial Extracts
Mark Menzies (Fylde) (Con)
Thank you, Mr Deputy Speaker, for allowing me to hold this Adjournment debate on the future of Blackpool airport, which is an extremely important issue facing my constituency and the Fylde coast. I know that all matters relating to the prosperity of Lancashire are of great interest to you, so it is a great pleasure to see you in the Chair this evening.
Blackpool’s first venture into aviation came more than a century ago, back in 1909, after which the airfield went on to play an important role in the UK’s early aviation history. In fact, the sister of aviation pioneer Amy Johnson lived in Stanley park in Blackpool, which resulted in her often paying a flying visit. It was in the 1930s that commercial flights first began operating from Blackpool, but following the outbreak of the second world war the airfield played a crucial role in the support of the Royal Air Force.
In the post-war years, the airport expanded rapidly, accommodating helicopter flights for gas rig workers and attracting scheduled flights from budget airlines, including Jet2.com, Monarch, Ryanair and smaller operators to Ireland and the Isle of Man.
Hon. Members may know that the airport was owned by Blackpool council until 2004, when it was sold to City Hopper Airports. During this time the airport grew rapidly, with passenger numbers rising from 266,000 in 2004 to more than 560,000 in 2007. In 2008, Balfour Beatty bought a 95% stake in the airport from City Hopper and gave a firm commitment to develop the airport as a commercial going concern.
The ensuing global position, however, saw most airports across the world experience a fall in passenger numbers. This saw Blackpool airport’s passenger numbers decline from just under 600,000 in 2007 to 262,000 last year. During that time the airport lost a number of flights from carriers such as Ryanair, with subsequent financial losses averaging approximately £2 million a year.
Blackpool airport has the ability to operate with extended flight times. During that period of downturn, the main passenger contract with Jet2.com required the airport to remain open for long hours and provide a certain level of safety and operational staff cover. The consequence was that the operational costs of the airport were in excess of £5 million a year, with little chance of recovering that sum from the number of passengers being put through the airport by Jet2.com.
Due to the significant losses being generated at the airport and the complications with the Jet2.com contract, Balfour Beatty announced in August 2014 that it had put the airport up for sale. Following a failure to find a buyer, it was announced that the airport would close on 15 October.
Many of my constituents have expressed to me their concerns that the airport’s closure seemed to proceed at breakneck speed, with insufficient time allowed to find suitable buyers. Although many of us in this House would have liked to see this situation handled differently, I want to concentrate on the next steps to secure the future of Blackpool airport.
Since the airport was put up for sale, I have been in regular contact with Mr Stewart Orrell, the managing director of infrastructure and investments for Balfour Beatty. In our meetings, I have impressed upon him the need for Balfour Beatty to work constructively to find a suitable buyer for the airport and to ensure that staff who have lost their jobs in the process receive the required support to find alternative work in the meantime.
I have also had conversations with potential buyers and investors, my fellow Fylde coast MPs, the Minister for Universities, Science and Cities, and the Under-Secretary of State for Transport, my hon. Friend the Member for Scarborough and Whitby (Mr Goodwill), who is in his place, to discuss ways to make the airport a more viable business.
I want to see what Government assistance might be on offer for those who wish to become involved in the airport’s future. I wrote to the Chancellor of the Exchequer and the Secretary of State for Transport outlining a range of potential measures to save the airport, including a possible reduction in air passenger duty for regional airports. My hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard) and I had a subsequent meeting with the Chancellor, at which we continued our discussions about the airport. The Chancellor listened intently to the points that we made and made clear his commitment to the Fylde coast. He said that he would work with me and my colleagues to find a solution that would increase the likelihood of aviation being retained on the Blackpool airport site.
In recent months, the Chancellor has outlined his vision for a northern powerhouse. If done correctly, that has the potential to make the north of England the engine that drives Britain’s economy once again and an area that competes not just with London, but with the great economic conurbations of Europe. For that to be achieved, connectivity and transport infrastructure will be crucial. Good transport links are at the heart of the proposed northern powerhouse. Although there has been much talk of HS3 and proposed road infrastructure improvements, viable regional airports will also have a vital role to play. It is for that reason that I feel passionately that Blackpool airport should be retained as a commercial airport. With the correct support from Government, it will remain a transport infrastructure asset for Lancashire and the north-west.
In order that that can happen, I have a number of requests to put to the Minister. While some of them will fall within his remit, others may fall within the portfolios of other Ministers. First, I appeal to those who are interested in operating a commercial airport to work with the liquidators, Zolfo Cooper, to ensure that the necessary equipment is retained on site so that the airport can continue to operate. That would include, for example, baggage-handling equipment, firefighting equipment and assets relating to air traffic control. When I spoke to Zolfo Cooper today, it informed me that it will be between six and eight weeks before a liquidation sale will proceed. It is important that interested parties contact the liquidators well before that deadline.
I have made it clear that I do not want Blackpool airport to go the same way as Manston airport in Kent, where there was a fire sale of assets that put the immediate future of the airport in doubt. May I take this opportunity to urge Blackpool Airport Properties Ltd, which is owned by Balfour Beatty, to give assurances that it will maintain the runway, taxiways and terminal buildings until an operator is found? I ask the Minister to work with colleagues across Government, in particular at the Home Office, to ensure that equipment relating to airport security and customs and immigration procedures is available to future operators as soon as they come forward.
A number of aviation businesses, such as flying schools, private jet service companies and helicopter operators, are currently working from the site and are facing uncertainty. It is crucial for the immediate future of the airport that those aviation businesses are retained. One of the largest operators is Bond Offshore Helicopters, which provides logistical support and personnel transport for the Morecombe bay and Irish sea gas rigs. I have been informed that it is temporarily operating out of BAE Systems’ Warton aerodrome, which is also in my constituency, while the future of Blackpool airport is decided. I understand that that is for a three-month period. I would not wish to see it go on any longer than that. I will speak to Bond Offshore Helicopters and BAE Systems to make my feelings clear: the company must remain at Blackpool airport.
Blackpool airport may be eligible to benefit from the regional airport connectivity fund. I would very much like the Government to offer that, should a suitable airline come forward to provide such a service to London.
Another source of Government assistance that I would like Ministers to explore is whether Blackpool airport could be considered for development capital through the regional growth fund. I believe that airport runways are strategic national assets that can only grow in importance, and they should be protected and supported by the Government to ensure their future viability.
Blackpool airport is about 400 acres, and I have been told that a viable airport business on that site would require only 220 acres to maintain an airport service. That leaves well over 100 acres that may be suitable for commercial development, and if done in a carefully planned way that would not only raise capital for the airport’s development, but it may also attract new businesses that seek to use the runway and hangerage facilities. Down the road in Warton we have an enterprise zone that sits adjacent to a runway and has been zoned for aviation, energy, and advanced manufacturing. May I suggest to the Government that the Warton enterprise zone be expanded to include excess Blackpool airport land that may be deemed suitable for commercial development?
Let me make it crystal clear, however, that if any developer is seeking to buy the airport, viewing it as a glorified brownfield site, simply to redevelop the land in its entirety for housing, retail or commercial use, I would find that completely unacceptable and fight it every step of the way. Such an act would be tantamount to economic vandalism, and would betray the hopes of local people and those across Lancashire who have supported the airport through thick and thin. To those developers thinking of going down that path, I say, “Don’t bother, and think again.”
Although the airport may be closed for now, I remain determined to work for its future and to keep the airfield working as it is a proud part of the Lancashire and Fylde economy. I feel the airport has the ability to be a successful commercial venture, and with the correct support and as Member of Parliament for Fylde, I will work with interested parties, including Blackpool and Fylde councils, the Lancashire enterprise partnership and any potential investors, to secure its future. I believe in Blackpool airport, and I ask us all to work together to secure its future because Lancashire deserves it.
Mr Gordon Marsden (Blackpool South) (Lab)
I congratulate the hon. Member for Fylde (Mark Menzies), my constituency neighbour, on securing this debate and on giving an excellent speech that summed up most, if not all, of the very strong arguments for why Blackpool should retain its airport in an operational state. He was right to draw attention to Blackpool airport’s long history and tradition, which goes back to 1909, as well as to its contribution during the second world war as the place where thousands of aircraft pilots were trained.
Today we must realise that the airport is of benefit not only to the people of Blackpool and the Fylde, or even to the tens of thousands of passengers who have used it every year for leisure and indeed business travel, and who now find themselves bereft of that opportunity because of what is—we hope—its temporary closure. The airport has the economic potential to be a crucial part of not only the sub-economy in the Fylde area but the economy of the whole of Lancashire, and I want to say a little more on that point.
The hon. Gentleman, quite rightly, referred to operations out of the airport, and at the time of closure the airport site was supporting 11 tenants, with important small businesses employing up to 200 people. That made up about a £20 million contribution to the sub-regional gross value added, and included, as the hon. Gentleman said, commercial passengers, offshore helicopters, general and corporate aviation, fuel sales and estates and commercial land development. Whatever problems there may have been, and whatever the disputes between Balfour Beatty—the owner of the airport—and Jet2.com, we must not lose sight of the fact that the businesses that were operating there were doing so in an expanding economic climate. We need only to look at the map of Liverpool bay—as I have done when wearing my hat as shadow maritime Minister—and at the sheer amount of activity going on to see that, so we must take that point into account. There are strong arguments and feelings among my constituents in Blackpool, not simply because of passenger usage or the airport’s heritage, but because of its economic value.
The issues raised in the debate are crucial. As the Minister knows, there are general problems with smaller airports in the regions. I will not stray from the topic of the debate, but I wrote to the Minister about the regional air connectivity fund. I was grateful for his positive response. As the hon. Member for Fylde has said, the Minister indicated that if new people come in with new flights, Blackpool could bid. However, it is not only a question of the air connectivity fund. It is also a question of what enabling mechanisms there might be for any new bidders to come in and take the airport on. The role of Lancashire enterprise partnership is potentially crucial in that, which is why I am glad that it is seriously considering what it can do with the support of the Fylde coast MPs to get that side of things moving.
The hon. Gentleman referred to the situation for anyone who wants to use the land for building or retail purposes. I entirely concur with his sentiments but, more importantly, so do the two councils—two thirds of the airport is in Fylde and the other is in my constituency, but Blackpool airport retains residual shares. I am glad that both councils have so far indicated that they would set their face against that form of development.
I shall conclude on one important point that the hon. Gentleman mentioned. There are bidders and potential discussions, but as you well know, Mr Deputy Speaker, it is one thing to have bidders and another to close the deal. One thing that might be needed to close the deal is the reuse and remodelling of that extra acreage to which the hon. Gentleman referred. Therefore, I would say both to him—I am sure he would agree—and to the Minister that that could be a crucial enabling facility for getting those potential bidders to sign up to the deal. I therefore ask the Minister to give an assurance that he will discuss the matter with the Minister for Universities, Science and Cities, or at least send the message to him.
Hon. Members are pulling together with Blackpool council and Fylde council. I pay tribute to the work of Blackpool council officers and John Jones, the transport cabinet member. We all want a successful future for Blackpool airport for the sake of the regional economy, and for the people of Blackpool and the Fylde coast, but we need that little bit of extra help and leverage from Ministers and the Government.
Paul Maynard (Blackpool North and Cleveleys) (Con)
I congratulate my hon. Friend the Member for Fylde (Mark Menzies) on securing the debate. I endorse everything he and the hon. Member for Blackpool South (Mr Marsden) have said. I will not repeat the points they have made but make one or two small observations.
The position has caused great concern on the Fylde coast for several weeks. It is right and proper that we debate it in the House of Commons. Many people in the aviation sector have told me that they are surprised that Blackpool lasted as long as it did. They say, “It was only the 29th busiest airport in the country. How could it possibly have had a long-term future?” Superficially, their point is attractive, but I should point out to the Blackpool naysayers that there is a profitable coastal airport over in Humberside—it is the 33rd busiest in the country and yet manages to turn a profit.
If we are thinking about the future of Blackpool airport, it is worth looking at what Humberside has achieved on limited means, and at how it has built a profitable business. First and foremost, Humberside has had good, strong growth in charter flights. We recognise that Balfour Beatty and Jet2.com have not had the easiest relationship. I urge Jet2.com to engage more constructively with any potential buyer about their possible future use of Blackpool. Jet2.com needs to show commitment and support to the airport. We should also recognise that many Jet2.com employees have lost their jobs at Blackpool airport as a consequence of the decision. They deserve a voice in the debate.
The hon. Member for Blackpool South (Mr Marsden) rightly pointed to the high degree of activity in the oil and gas sector in Liverpool bay at the moment. It is worth noting that Humberside has a major oil and gas operation that sustains what it is doing.
The third crucial leg of what makes Humberside profitable is that it is has a connection to Amsterdam. I am quite sure that the Treasury does not want to hear this, but links to Amsterdam are an excellent way for passengers to try to avoid paying air passenger duty. If one looks at passenger usage figures for Humberside, one sees that the flights to Amsterdam contribute the most passengers. It would be an excellent addition to Blackpool’s portfolio of routes if KLM or a similar operator were to introduce an operation to Amsterdam or, for that matter, Frankfurt.
Those three sets of circumstances could together make an airport like Blackpool profitable once again. Many constituents have written to me to say how distressed they are that one of the country’s first airports, with a fine proud heritage, has somehow fallen into obsolescence without anyone really seeming to take much notice, as though there was nothing that could be done. The local MPs here today have at least made the point that there is plenty that can be done, providing there is great optimism. If we can secure this precious enterprise zone, and if the local enterprise partnership steps up to the plate and delivers on its potential in terms of economic regeneration, Blackpool airport will once again reopen and have a profitable mix of routes that will make it sustainable in the long term. I urge all our constituents not to despair at this stage, but to hope that the many potential buyers out there can engage fruitfully with the other airlines and local councils.
The Parliamentary Under-Secretary of State for Transport (Mr Robert Goodwill)
I congratulate my hon. Friend the Member for Fylde (Mark Menzies) on securing this debate on the future of Blackpool airport. I commend him for his engagement with those who have been striving to secure a future for the airport.
In recent years, increasing demand for commercial air travel has heightened the need to improve the capacity and efficiency of UK airports. This is absolutely essential to meet the Government’s commitment to maintain the UK’s aviation hub status. In our aviation policy framework published last year, we recognised the crucial role that regional airports play in providing airport capacity and the vital contribution they can make to the growth of their local economies. Indeed, I like to refer to them as local international airports, rather than just regional airports. The Government are therefore determined that the UK continues to benefit from the services that regional airports offer. We welcome the ambition many of them are showing through investing in their infrastructure, increasing accessibility and facilitating more services to more destinations. I have also been impressed by the efforts many airports are making to diversify into different activities, such as aircraft maintenance, repair and overhaul, business aviation and other support services, and providing space for other, non-aviation businesses.
I am aware of Blackpool airport’s proud history, which goes back as far as 1909 when the UK’s first official public flying meeting took place there. In the 1930s, the pioneering Railway Air Services operated commercial schedules to the Isle of Man, Manchester and Liverpool, with connections to other UK destinations including London. As RAF Squires Gate, the aerodrome had an illustrious history. During the second world war it served as a base for operational RAF coastal command squadrons patrolling the Irish sea and eastern Atlantic, and for specialist reconnaissance and technical training schools. The Ministry of Aircraft Production set up a huge shadow aircraft factory close to the aerodrome for Vickers Armstrong to manufacture and test more than 3,500 Wellington bombers between 1940 and 1945. Airline services resumed from 1946 and the airport enjoyed relatively steady commercial air operations for many years, allowing a lot of people in the Lancashire area to experience their very first foreign holiday. However, services and passenger numbers declined steadily from the 1970s onwards, as charter operators moved to other, larger airports.
In recent years, Blackpool airport has struggled to attract and retain consistent air passenger services. However, like many other smaller airports, Blackpool airport has more strings to its bow, and also serves as an important base for a number of aviation-related support and maintenance businesses, as well as flying training schools and business and general aviation operators. In fact, Blackpool airport played a role in the 1983 general election campaign, when Prime Minister Margaret Thatcher was spirited to the Fylde coast via the airport for one of her final election rallies. I was therefore very sorry to learn in August that Blackpool airport’s owner, Balfour Beatty, was putting the airport up for sale and that it would close in mid-October if no buyer came forward. Unfortunately, as we know, no buyer was forthcoming, and the airport’s owner issued a statement on 7 October confirming that the closure would go ahead on 15 October. The final commercial flight departed for the Isle of Man at 5 pm that day.
I fully recognise concerns in the area about the impact that the airport’s closure could have on the local and regional economy, and the reduction in travel choice and opportunity. However, in the first instance this is essentially a commercial matter for the airport’s owner. As hon. Members will understand, airports in the UK and the airlines that use them operate in a competitive, commercial environment. The UK’s aviation sector is overwhelmingly in the private sector, and this Government support competition as an effective way to meet the interests of air passengers and other users. It is for individual airports to take decisions on commercial matters, which will of course include questions of services and future viability. Equally, airlines take similar commercial decisions in regard to the routes that they operate and from which airports. It is not open to the Government to compel airports or airlines to operate services.
I know, however, that my hon. Friend the Member for Fylde and other parliamentary colleagues from the area, from whom we have heard tonight, are involved in ongoing discussions to secure the future of the site and retain an aviation presence there, as well as working with local partners, including Blackpool council, to explore the potential for turning the airport into an enterprise zone. The airport continues to work with general aviation businesses and others based on the airport site to discuss options for them to remain there in the longer term. I warmly commend all those collaborative efforts and very much hope that a resolution can be achieved that will maintain aviation activity at the airport.
Taking a wider view, the Government remain committed to rebalancing the economy and supporting regional development. Hon. Members will know that Lancashire’s local enterprise partnership was successful earlier this year in securing over £230 million from the Government’s local growth fund to support economic growth in the area. Let me restate our determination that the UK should continue to benefit from the contribution that regional airports can offer. The Chancellor recently announced that applications will now be allowed for start-up aid for new air routes from UK regional airports. To be eligible, airports must handle fewer than 5 million passengers per annum and meet new European Union state aid guidelines. The Department for Transport is working with the Treasury to determine how the funding process will operate in practice. We hope to be in a position to announce routes that can be funded in the new year.
As hon. Members will also be aware, the independent Airports Commission, chaired by Sir Howard Davies, has been established to identify and recommend options to maintain this country’s status as an international hub for aviation. In preparing its interim report, the commission undertook a detailed assessment of the UK’s future aviation demand and connectivity requirements. The interim report, published last December, details a shortlist of long-term options for further study to increase airport capacity, along with recommendations for the short term to make the best use of our existing infrastructure. The commission also recognised that, in the short and medium term, the Government do not have effective levers to redistribute traffic to less congested airports, even if it were desirable to do so. All the shortlisted long-term options are now the subject of more detailed analysis and consultation by the commission. To protect the integrity of the process, the Government will not comment on any of the shortlisted options.
I was asked a number of questions. First, I was asked what the Government can do to step in and prevent the liquidator from selling off the airport’s fixtures and fittings. I can report that the Insolvency Service has confirmed that Blackpool Airport Ltd entered creditors’ voluntary liquidation proceedings on 7 October and that a liquidator was appointed on 16 October. Matters concerning the disposal of the airport’s assets are for the airport’s owner and the appointed liquidator, and we heard that it would be six to eight weeks before a sale could proceed. The liquidator has a duty to ensure that the maximum levels of realisation from sales of assets are achieved to ensure the best returns to the creditors. In the meantime, there is an important window to explore other aviation-related options.
We heard about other forms of aviation, particularly helicopters. I can comment on the North West Air Ambulance helicopter operations from Blackpool airport. The North West Air Ambulance charity has confirmed that its service will not be affected by the airport’s closure. The charity has confirmed publicly that whatever happens, it has a number of measures in place and that emergency services will not be affected. The airport continues, too, to work with other aviation support businesses and general aviation operators based at the airport site to discuss options for them to operate from the site in the longer term. I know that Bond Offshore Helicopters was mentioned in the debate.
I appreciate that the hon. Member for Blackpool South (Mr Marsden) is the shadow aviation Minister, and I particularly value his contribution through correspondence. He is speaking as a Back Bencher in this debate, but I understand how important this issue is for him—not only locally as the local Member of Parliament, but nationally in respect of our overall regional airport policy. When it comes to bidders, it is important to make the best use of all the land on the site and to capitalise on the opportunity. The hon. Gentleman asked me to be a messenger to the Government, but I do not think he needs me to pass on the message, as I am sure his contribution to tonight’s debate will have gone out far and wide to all interested parties.
My hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard) rightly drew attention to the fact that passenger numbers, freight numbers and aircraft movements have declined and mentioned the success of Humberside in that regard. Yes, Humberside has opportunities for oil and gas, but one of the biggest problems for Blackpool by comparison with Humberside is that it is not quite so close to an airport that is as strong and competitive. My hon. Friend mentioned the fact that a KLM route from Schiphol will benefit to an extent from the distortion of air passenger duty, but I must point out that any questions about APD should properly be directed to the Chancellor of the Exchequer. It is interesting to note that what precipitated the problems at Manston was in many cases due to the fact that the KLM service was withdrawn.
I thank my hon. Friend the Member for Fylde once again for securing this debate. I underline the fact that the Government are committed to improving the capacity and the efficiency of UK airports to maintain the UK’s aviation hub status. Although fully aware of the importance of regional airports in this, the Government are unable to intervene directly in Blackpool’s case, as it is ultimately the responsibility of the airport’s owner to determine whether or not it is commercially viable.
Question put and agreed to.