Transport Act 2000 (Air Traffic Services Licence Modification Appeals) (Prescribed Aerodromes) Regulations 2022

Tuesday 25th January 2022 Grand Committee

Considered in Grand Committee

17:03

Moved by

[Baroness Vere of Norbiton]

That the Grand Committee do consider the Transport Act 2000 (Air Traffic Services Licence Modification Appeals) (Prescribed Aerodromes) Regulations 2022.

[The Parliamentary Under-Secretary of State, Department for Transport (Baroness Vere of Norbiton) (Con)]

My Lords, these draft regulations will be made under the powers conferred by the Transport Act 2000. The regulations set out which airports may appeal licence modification decisions made by the Civil Aviation Authority, or CAA, in respect of the en-route air traffic services licence granted under Section 6 of the Transport Act 2000. In essence, this instrument will ensure that the aerodromes likely to be materially affected by a decision to modify a licence condition are able to appeal those decisions.

Air traffic management services in the UK fall into two categories. The first are terminal air navigation services provided at individual airports. They support arrivals, departures, and planes in the vicinity of the airport typically up to an altitude of 7,000 feet. This is a competitive market, with airports procuring these services from a number of possible organisations or providing their own. The second are for planes outside of these areas, such as planes at cruising altitude, or planes being guided to gateways where they can be handed over to terminal control services of airports. These services are delivered by a monopoly provider, regulated under the en-route air traffic licence.

The Air Traffic Management and Unmanned Aircraft Act 2021—the ATMUA Act—updated the Transport Act 2000 to give the CAA a more effective power to modify the conditions of air traffic services licences. Currently, the only licence which has been granted is held by NATS (En Route) plc, also known as NERL, to provide certain air traffic services in the United Kingdom. Under the previous framework, the CAA could only modify the conditions of this licence with consent from the licence holder or via a determination by the Competition and Markets Authority.

To modernise the licensing framework, alongside the powers to modify the licence conditions the Act also introduced a new appeal process into the Transport Act 2000, which gives appeal rights in respect of licence modifications to three parties. The first is NERL, the licence holder; the second is the owner or operator of an aircraft whose interests are materially affected by the decision; and/or an owner or manager of a “prescribed aerodrome” whose interests are materially affected by the decision. Should any of these parties wish to appeal the decision to modify a licence condition, they could appeal to the CMA on one of more of the following grounds, namely: that the decision was based on an error of fact; that the decision was wrong in law; and/or that an error was made in the exercise of a discretion. For the relevant aerodromes to be able to appeal licence modification decisions, they must be prescribed in secondary legislation, which is what this draft instrument seeks to do.

Turning to the content of the SI, the CAA can modify the conditions set out within NERL’s licence. A licence condition relates to operational matters, such as the requirements which the licence holder must meet to maximise safety and efficiency, and includes conditions relating to control of charges—the prices that users of NERL’s services pay for the services that they receive. To modify a licence condition, the CAA first must publish a notice in relation to the proposed modification. It must state that it is proposing to modify the licence and set out what the modification is, the reasons for it and its effect. It must then give a reasonable period for NERL and the other relevant stakeholders to make representations. The Department for Transport consulted on this policy in 2017. Stakeholders were broadly supportive of the policy and no aerodromes at the time requested additional appeal rights.

As the licence conditions include control of charges for the London approach service, the Government have decided that airport operators whose interests could be materially affected by the decision to modify a licence condition are likely to be airports receiving the London approach service from the licence holder, and that these aerodromes should be able to appeal these decisions on the grounds of fairness. The London approach service consists of the control and sequencing of flights between the licence holder’s en-route service, which will be quite high up, and which operationally include holding stacks, and the tower service at London airports, which is quite low down, and which is provided at each airport by an air navigation service provider under contract with the airport operator. Airports currently receiving the London approach service from NERL are Heathrow, Gatwick, Stansted, Luton and London City, and these regulations enable those airports to appeal. These regulations have been drafted in such a way as to ensure that in the future, should another aerodrome become part of the London approach service from NERL under its licence, it too will be able to appeal modifications to licence conditions.

This instrument will ensure that the aerodromes likely to be materially affected by a decision to modify a licence condition can appeal those decisions. It is as simple as that. I beg to move.

[Baroness Foster of Oxton (Con)]

My Lords, I thank my noble friend for the Explanatory Memorandum and the information she just gave us. There are two areas highlighted by the Explanatory Memorandum that are hugely important, which are the failures with computer systems and with NERL. But I want to raise another, which I hope has been fully rectified now. I was the rapporteur in the European Parliament in 2015 on the safe use of civil RPASs or drones, so I will reflect on what happened a couple of years ago, because this is a growing industry and we need to make sure we keep our eye on the ball.

As I recollect, between 19 and 21 December 2018, there were drone sightings at Gatwick. Regrettably, 140,000 passengers and 1,000 flights were affected. This was the biggest closure since the 2010 volcanic eruption in Iceland and, I have to say, the way it was handled became quite farcical. The airport spokesman said they could not do much about it, because there was no counter-drone technology when, actually, there was, albeit it was not at Gatwick then. It also ended with two people being arrested and, fortunately, released and paid compensation. It was not exactly a good look for the UK.

In addition, we must also realise the challenge of geo-fencing in the civil drones sector. This is particularly difficult for airfields, due to their geographical size. For example, Gatwick or Heathrow—a large airport—covers several square miles, but just in their infrastructure and to their boundaries or the end of the runways. That does not include the miles of airspace above, where an aircraft can be at risk either on ascent or descent. We know this is a huge challenge.

Nevertheless, the cost of the investigation was £800,000 and it had to include the police, military and the RAF in particular. The good news that followed was that Gatwick and others installed counter-drone technology in 2019, which is now available across all the appropriate airports in the United Kingdom.

We have a world-class civil aviation industry and reputation, which I am sure all noble Lords agree we must maintain. I ask my noble friend to give me the reassurance that the CAA, which is an excellent regulatory body, will continue to have clear and detailed oversight of this area to maintain our high standards, certainly in this growing industry.

The final point I raise, which will be covered by two other noble Lords so I will not cover it in too much detail, is regarding EGNOS. I was again a rapporteur in the European Parliament on GNSS, so I have a serious interest in the systems we require to make sure our airfields are well-equipped. Since, by all accounts, EGNOS was stopped last year, a number of our peripheral, small airports have been put in huge difficulty. We have flights either being cancelled or their safety jeopardised, for both passengers and crew. They are hugely reliant on life-saving services coming in, whether to take people to the hospitals on the mainland or for other reasons.

I will finalise on those points, because I think my noble friend is aware of them and has passed them on. We look forward to meeting with the appropriate Minister at some stage, and I thank her very much for taking these points on board.

17:15

[Lord Berkeley (Lab)]

My Lords, I am grateful for the opportunity to take part in yet another short debate on navigation systems. I was very grateful to the Minister for writing to noble Lords to clarify things after the last debate, but I was sorry that I did not get a letter saying that she had arranged a meeting with the Minister for Aviation. I hope that she may tell us more about that today.

I wanted to update noble Lords on what has happened on EGNOS since the last debate. I have been given a copy of a letter from Robert Courts MP, the Parliamentary Under-Secretary of State for Air, to Jim McMahon MP, a Labour shadow Secretary of State, dated 22 June. The letter explains why the Government are not going ahead with EGNOS, and basically says that, in discussions with the European Commission, the Government decided that it was not considered to offer good value for the taxpayer.

I have been reflecting on what that means. Having talked to people in the Highlands and Islands, and Loganair, and having been in the Isles of Scilly last weekend, I discovered that the issue of safety of life, which the noble Baroness, Lady Foster, mentioned, is actually quite serious. In Scilly, there is no ferry in the winter, so people rely on air. There was a time between Christmas and new year this year when some people got delayed and had to spend five days in a hotel with their family, which does not come cheap.

More importantly, the Isles of Scilly and many of the Scottish islands rely on air help for medical emergencies—either a helicopter or a fixed-wing plane, depending on the circumstances. If people cannot fly due to bad navigation, usually fog, their health is at risk. I am not sure how the Minister for Aviation can say that that is not good value for money. I do not know how much he puts on a life that is lost because you cannot fly, when there is an alternative.

The Minister may not have the answers today, so perhaps she could write, but what is the actual cost of reinstalling EGNOS? There must be a cost from the European Union, even as a temporary measure. If there is an alternative, what is it, and when will it be ready? We need answers to those questions, because at the moment a lot of money is being spent on abortive attempts to keep EGNOS going, or not even start it. Maybe some of those who spent the money will look to have compensation, but it is more important that we find a solution that can be done and, I hope, worked with the European Union, even as a temporary measure.

I conclude by noting that the Channel Islands, which are not part of the UK air traffic system, have EGNOS. They have confirmed to me that they are continuing to use it, and as far as I can gather it does not cost them very much, if anything at all. I look forward to the Minister’s response, and I hope that she can soon give us a date for meeting the Air Minister.

[Lord Davies of Gower (Con)]

My Lords, I am very grateful to the noble Lord, Lord Berkeley, for raising this aspect of air traffic services, and it is a pleasure to follow him. I should perhaps draw attention to my role as co-chair of the All-Party Parliamentary Group on General Aviation and as an aviator who is often confronted with inclement weather conditions, when the provision of satellite-assisted navigation is of enormous help.

At the conclusion of the Brexit negotiations, a number of reasons were put forward from various sources as an explanation for the loss of the high-accuracy guidance provided by the European Geostationary Navigation Overlay Service, EGNOS, ranging from running out of negotiating time to the EU demanding an excessive amount of money to remain within the Galileo system. Seeking clarification in a Written Question to the Department for Business, Energy and Industrial Strategy on 20 April last year, I asked

“what financial contribution the EU requested for the UK to continue to access the European Geostationary Navigation Overlay Service Safety of Life service; how the request compared with the UK’s previous contributions; how they assessed value for money in view of its impact on aviation; and what plans they have to renegotiate access to this service.”

It was a disappointing response. I was told:

“The UK sought to negotiate a service access agreement on


EGNOS

“with the EU. However, the EU required participation in the programme along with the full associated costs of participation, as per previous years, for continued access to the EGNOS Safety of Life service. For all programmes under consideration, the Government was clear it would only participate where the terms were in the UK’s interests, and in this case, it was not considered value for money.”

The question of financial contribution was not answered.

I am bound to say that I find that quite astonishing. The whole purpose of EGNOS, which provides localiser performance with vertical guidance, commonly known as LPV accuracy, is the safe operation of aircraft. The clue is in the title: Safety of Life service. Surely this should be in the UK’s interest, and everyone else’s.

The loss of this service has had enormous financial implications for airfields, many of them small training establishments, which have assisted in EGNOS-assisted approaches. What is more, student pilots training for commercial licences have lost the opportunity to undertake the necessary practical training for those airfield approaches within the UK, with the prospect of moving to European training schools and consequent loss of revenue to UK training establishments.

Above all, it is the safety access which the EGNOS service provides and which has now been lost due to the Government putting value for money before the Safety of Life service. My question is simple: how much would it cost to retain that facility, or is it still the Government’s position that finances override the safety aspect of EGNOS?

In answer to a further Written Question of mine a year ago, I was informed:

“The Government continues to explore options for mitigating the loss of the LPV capability.”


Perhaps the Minister can update the House on exactly how much further forward we are on those much needed options and what the timescale is.

This is an extremely important issue on which the aviation community feels sorely let down, so I ask the Minister to do whatever she can to reinstate this important service, which, on the face of it, appears to have gone completely off the radar. I look forward to my noble friend’s response.

As we are considering aviation licensing issues, perhaps I can ask my noble friend’s indulgence for a moment longer on the issue of a recently adopted regulation resulting in pilots now being prevented from flying in UK airspace using US FAA flight crew licences. This is having a particular effect on helicopter operations. As the Minister will know, many pilots in the UK have FAA licences due to the costs involved with the UK’s authority, the CAA, which is one of the most expensive authorities in the developed world. I believe that Article 2(1)(b)(ii) of UK regulation 2018/1139 is the element causing problems for owners. The legislation applies to all third-country licence holders, including FAA licence holders resident in the UK, and all third-country aircraft registered in the UK.

The pressing issue is residence within the UK. If it was a case of the aircraft residing elsewhere, it would not be an issue. The legislation does not consider aircraft on the FAA register separately, as they are on a third-country register. Pilots and engineers who work on aircraft hold a multitude of different licences, not just FAA ones. Rather puzzlingly, the FAA instructor who conducts checkrides is invariably also a UK CAA examiner. Therefore, it is difficult for operators to understand why they should now be stopped from flying. We have a frustrated section of the aviation community unable to fly for business, with multimillion-pound helicopters and experienced private and commercial pilots having been made redundant through the legislation. I would be grateful if the Minister could outline how the DfT plans to address the issue.

[Baroness Randerson (LD)]

I thank the Minister for her introduction to these regulations. I will start by addressing what is in them before turning to other issues—I do not want to disappoint her, but I will turn to other issues.

The background to these regulations seems to lie in two serious systems failures way back in 2013 and 2014. These led in due course to this SI, via the 2021 Act. It has taken a very long time to get here, in an industry where technological development is very fast paced. Both the CAA and the CMA have additional responsibilities as a result of these regulations. They are the Government’s usual maids-of-all-work; barely a week seems to pass here without them picking up some additional responsibility. I ask my usual question to the Minister: what additional resources are they being provided with as a result of these additional responsibilities?

A recent Written Answer to one of my questions revealed that two people had been assigned to the team tasked with promoting general aviation and liaison with general aviation airfields, spending £375,000. By comparison, these regulations deal with very large airports and very large numbers of large airports. How many people are to be regularly devoted to the licensing of air traffic services? How many additional people does the Minister think will be required as a result of these regulations?

I say this because paragraph 12.4 of the Explanatory Memorandum refers very specifically to an increase in the number of appeals. It talks about an 8% increase in the number of minor modifications appeals and a 12% increase for major modification appeals. When, where and how did these figures come about? How were they arrived at? There was no formal consultation and no full impact assessment. My concern is that, without those, it is very difficult to be that precise. I was surprised by that lack of consultation, because modifications which affect the London approach affect a very large number of users—not just large companies and airports but the users of the airports and small companies and individuals too.

I move on to the other issue, EGNOS. I thank the noble Lord, Lord Berkeley, for his continued work on this really important issue. The noble Baroness, Lady Foster, and the noble Lord, Lord Davies, spoke with great expertise and knowledge on this. I have also been surprised by the lack of any apparent reference to the loss of EGNOS. I have been looking online, on the DfT website, for a formal statement; there is absolute silence, as far as I can see, on this essential issue.

17:30

Most worrying of all is the level of ignorance at an official level about EGNOS’s importance, which apparently allowed the BEIS negotiating team to conclude negotiations that took us out of the system without— it would appear—any understanding of the huge implications of that decision. There are major safety implications, with at least 18 airports affected. This goes beyond whether it is safe to take off and land; these services also provide life-saving flights, such as air ambulance flights, and essential medical supplies. The Government talk about strengthening the union and say that infrastructure is important, so much so that there was a serious study into whether we should, as a nation, spend tens of billions of pounds on building a fixed link between Great Britain and Northern Ireland, yet we appear not to have the money to be members of EGNOS.

This is a basic technology, and not being part of it reduces our links with the Highlands and Islands of Scotland at a time when we are all worried about the union. It reduces our links with the Scilly Isles. It makes life less safe for those living in those parts and in other remote areas. Its implications go well beyond the economy and tourism. What about the implications of the hundreds of millions that have been invested in this technology by the industry? I, too, would like the Minister to spell out the cost of EGNOS. The figure I found, with some difficulty, was £48 million, but I do not know whether that is accurate, or way out. I do not know whether it is an annual or one-off rejoining figure.

When the Government were—how can I put this?—caught out by the reality of the situation, they said, with schoolboy bravado, “We’ll build our own”. But, as the noble Lord, Lord Davies, has made absolutely clear, you do not do that overnight, and the industry estimates that it would take 10 to 15 years. What do we do in the meantime? Norway and Switzerland, which are not members of the EU, have negotiated access to EGNOS. Why cannot we? Will the Minister explain how much it would cost and what can be done in reality in the immediate future to plug the gap left by losing this essential technology?

[Lord Rosser (Lab)]

I start by saying that I will probably end up making the shortest speech so far—I hasten to add that that is in no way a criticism of any speeches made, but simply a statement of fact. Like others, I thank the Minister for her explanation of the content and purpose of these regulations. Although I have in front of me a statement on the background and what the regulations do, I will not wade through it; the Minister and others have already outlined that.

I raise one issue only, but say before that that I await with great interest the answers to the questions raised by the noble Baronesses, Lady Foster of Oxton and Lady Randerson, the noble Lord, Lord Davies of Gower, and my noble friend Lord Berkeley. I refer to the statement by Robert Courts MP, which is in the EM:

“The intention of this measure is to ensure that airports which receive an approach control service from the licence holder through its licence are able to appeal decisions relating to modification of licence conditions”.


The EM goes on to say that:

“The number of expected licence modifications over a 20-year period is expected to be between 8 and 16 modifications for major modifications such as price controls, and between 6 and 18 modifications for minor modifications such as procedural changes.”


Like others, I am not sure what workload or otherwise that would generate, so some clarification would be helpful.

I ask that in the context of paragraph 12.4 of the EM, which has already been referred to. It says that:

“In allowing prescribed aerodromes to appeal decisions there is the potential that a greater number of appeals will be launched. However, during the consultation phrase, no aerodromes requested appeal rights, which suggests they may be unlikely to appeal modifications to licence conditions.”


Bearing in mind that the more major modifications may relate to price controls, are there any criteria for changing those price controls? If it is confidently expected that there will be no appeals, presumably, when the changes are made, if they are, they will be relatively limited as far as the prescribed aerodromes are concerned. The Minister has already mentioned which aerodromes those are.

I therefore seek further information about modifications to price controls, the criteria for making them, how frequently they are made—it appears to be fairly infrequent—and whether they have ever proved controversial before in relation to prescribed aerodromes. That is the only point I wish to raise. The subject matter covered by the SI seems straightforward and desirable, but I await the answers to the other issues that were raised with interest.

[Baroness Vere of Norbiton (Con)]

I am grateful to noble Lords for their contributions today. It has turned into a general debate on air stuff, so noble Lords will not be surprised that I came here with 49 pages of briefing to answer detailed questions on the SI and am therefore unable to answer issues that have been raised that, frankly, are not even close to the scope of what is before noble Lords today.

Noble Lords mentioned EGNOS to me recently. I have confirmed with the office of the Aviation Minister that he is happy to meet with you. All noble Lords with an interest may pop along to that meeting and I hope to get there as well.

My noble friend Lady Foster asked about unmanned aircraft. I am sure she would have appreciated being in the House for the Air Traffic Management and Unmanned Aircraft Bill. We had lots of fun. It took a long time, but we talked a lot about drones and the role of the CAA. I remain reassured that the CAA has a grip on the situation. In that Bill, we gave the police extra powers to ensure that drones are appropriately enforced, where needed. I will try to get a response for my noble friend Lord Davies of Gower about American licences.

I turn to the contents of this SI. The noble Baroness, Lady Randerson, will recall the challenges of getting the Air Traffic Management and Unmanned Aircraft Bill through, which is where these powers very much came from. But it was not necessarily the case that there was a great big gap between that and some of the failures that happened before. There were just two failures, which were obviously both very carefully investigated by the CAA, working very closely with NATS to establish exactly what happened. That work took quite a long time, and we know that, on 25 February last year, for example, following an investigation under the Transport Act 2000, the CAA published its final decision confirming that NERL had contributed some of its statutory and licence duties and obligations in the period January 2019 into 2020 in relation to the provision of sufficient staffing resilience in the London approach service for users of Stansted and Luton airports. In making its findings, the CAA took account of the very difficult circumstances faced by the aviation sector and the significant reduction of air traffic volumes following the Covid-19 pandemic. It strikes me that, prior to those powers being available, the CAA has historically had a firm grip on NATS and its activities, and continues to get very involved wherever there may be failings.

What is under discussion today is actually a very small and narrow element of the world of licences and the provision of air traffic management services. The CAA, as is stated in the Explanatory Memorandum, rarely updates the licence—but it does, and when it does, as I set out in my opening speech, it does it by consultation with everybody who is likely to be affected. Therefore, it is not a surprise to us, and I believe should not be a surprise to the industry either, that we expect appeals to be relatively rare, because an enormous amount of consultation will go on beforehand. We know that people will be able to put forward their views—and I believe that we discussed this during the passage of the ATMUA Bill, now the ATMUA Act, as to the appeals process, how likely the appeals were likely to be, and whether there were resources at the CMA. We went through all those things, and I believe that, when the Bill was passed, we had reached a pretty good assessment about how we felt the appeals process was going to be.

We know that no airports have actually asked for these powers, but the Government have, out of an abundance of caution, given them the ability to appeal, just in case they need to. The reality is that it is only going to be about a modification that is about a change of price, because essentially everything else is not really related to the airports. The airlines and owners of the aircraft have far more beef with it. For the airports, it is really about the hand-off between up there and down here, and the charge for that hand-off that they might want to challenge, but they have never given us any indication that they would do so. The chances of getting an SI passed if they wanted to do so in future is, quite frankly, probably not huge.

That is why we are doing this—just in case they want to. We are not expecting them to do so, and they have given us no indication that they will. But we said that we would do it in the Bill; we felt that it was the fair thing to do, and that is why we are here today. The figures that we put in the EM explain that there may be a 10% increase in the number of appeals. We feel that that may be high, but we have to put something in there. In general, that is why the impact assessment is de minimis, because from this SI there will be almost no impact at all. I have some figures for costs somewhere, and I might put it in a letter afterwards, but our estimated costs are very small.

To that end, we do not see that this SI will cause the CAA to have any resource implications at all. As we know, modifications are fairly infrequent and we expect appeals to be rare. Appeals for this particular thing are possibly like hens’ teeth. I very much hope that it does not have a full-time member of staff on it. However, I will write with information on the number of people who look after NERL licensing. That is a very good challenge and I will find out exactly how big that group is.

I note that the noble Lord, Lord Rosser, made a very short speech; I thank him for being here because I know that he has had an incredibly busy day in the Chamber as well. However, the points he raised about whether there is likely to be an appeal and what has to happen in order for that change to happen have been covered.

I have run out of things to say from the questions that I was asked. As ever, I will look through Hansard and write if necessary.

Motion agreed.