Aviation, Travel and Tourism Industries

Gavin Newlands Excerpts

Thursday 10th June 2021 Commons Chamber

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

I think it is clear to all of us just how important international travel is to the economy, and to the tourism and hospitality sector in particular. With European and world connectivity now more important than ever, it is the Scottish Government’s ambition to see airports and airlines restored to 2019 levels of connectivity as quickly as possible.

It is clear to all Members just how crucial tourism is to the Scottish economy. Luckily, the Scottish Government are perfectly aware of that. UK Hospitality is clear that, although the Scottish Government are providing funds through breathing space for business rates, the UK Government are just kicking the can down the road. Moreover, the fact that they have remained committed to imposing a September cliff edge on the sector by ending furlough and the 5% VAT rate is unforgivable.

[Chris Grayling]

Will the hon. Gentleman give way?

[Gavin Newlands]

I would love to, but I am extremely pressed for time so I will crack on.

Given the time constraints I just mentioned, my hon. Friend the Member for Ochil and South Perthshire (John Nicolson) will make more comment on the tourism sector in his speech.

I think we all accept that the very nature of the pandemic has meant that reaction to events has had to be quick, changing in some cases day to day based on epidemiological evidence. Believe it or not from my tone sometimes, I am sympathetic to the pressures on Ministers and officials who have had to deal with the pandemic day to day and hour by hour, taking decisions with massive consequences for our economy and society. It has to be said though that the Government’s conduct in preventing the further importation of the delta variant was nothing short of a disgrace.

It is difficult to work out whether irresponsible delays in reintroducing travel restrictions to and from India while case numbers were surging were down to governmental desperation and self-interest while trying to set up a trade deal that would not be necessary if the kamikaze mission of Brexit had not been set in motion, or just sheer incompetence. Whatever the real reason, the result has been the importation of delta cases that could have been prevented had timeous action been taken or, indeed, had the UK Government just followed the advice provided on hotel quarantine, as the Scottish Government did. The UK Government even refused to help identify passengers in England travelling on to Scotland so that they could also be required to enter quarantine hotels. We can see the result of that approach right now in the rising delta caseload.

Although some restrictions on air travel are still necessary, aviation more than any other sector needs help and support from the state at this time of emergency. Unbelievably, we are still waiting for the type of sector-specific support promised by the Chancellor right at the start of the pandemic. Even with the limited fiscal and constitution levers at their disposal, the Scottish Government stepped up immediately and provided more targeted support to aviation businesses than the UK through extending 100% business rates relief for the whole of last year, and now for this financial year, too. In contrast, when the UK Government finally followed suit, they did so in a much more limited way when it came to eligibility and capping that support. They have also failed to match the additional year’s support, extending the limited scheme by only six months, a position that will surely have to change should their policies continue.

In a coup de grâce, the Government also saw fit to remove the extra statutory concession that had provided vital retail revenue for airports across the country and that was of particular importance outside London and the south-east. That decision has already resulted in dozens of retail outlets closing and hundreds of jobs going from airport retail in Scotland alone. The impact of that lost revenue will not only be felt in retail operations; the income was used to cross-subsidise a huge amount of airport operations, including attracting new routes and retaining old ones. In short, the decision is a hugely myopic one that I hope the Treasury will reverse.

We might think that that was plenty for the industry to be dealing with, but there is always one more thing with this Government, particularly if it involves Brexit. UK airlines have been put at a competitive disadvantage versus their EU counterparts when it comes to cargo and chartered routes. In terms of traffic rights, we—in the form of the Civil Aviation Authority—are very quick to grant rights to other European airlines, but the same reciprocity does not occur in many European countries. That clearly makes it much more difficult for UK-based airlines to secure contracts. Indeed, nothing makes that point more starkly than the fact that the Ministry of Defence has given a contract to transport UK armed forces personnel to a Polish airline, bailed out by a Polish Government, which we have quickly given rights to fly. All the while, UK aircraft remain grounded and the air crews and associated personnel remain furloughed at the taxpayer’s expense.

So much for taking back control. This is yet another Brexit dividend from people who brought us the sunny uplands—the same uplands our hill farmers are currently wrestling with. This is no way to secure an aviation sector, or the hundreds of thousands of jobs that directly and indirectly rely on it in the short or long term. Building capacity and sustainability in the long term has to be the priority for Government and the industry once the worst of the pandemic is over.

I have lost count of the number of times that regional connectivity has been raised with Ministers in this place. Our economies and wider communities are being held back and damaged by the UK’s over-centralising, decades-old policy of reliance on London and the south-east as gateways to the rest of Europe and the world. Regional connectivity is needed if we are to attract visitors and tourists over the coming months as restrictions are lifted. Although VisitScotland, the Scottish Government and the tourism and hospitality industries are all working hard to restart the sector, the fact is that visitors need to be able to get here in the first place.

We have now been waiting 17 months for the regional connectivity review. Local economies need that review to report, and to report now. There is no time to lose for communities that stand to be frozen out of recovery and see jobs and prosperity disappear for want of any strategy or plan from the Government. It must be remembered that for regional airports, Flybe’s collapse was a hammer-blow that preceded the pandemic. Even without covid-19, we would still be facing the same substantial challenges and, I rather suspect, the same lack of action from the Government.

I must make an uncharacteristically positive point. With the demise of Flybe, Loganair is now the UK’s largest regional airline. The airline is based in my constituency, and I was very proud to see the announcement this morning that it was the UK’s first regional airline to become carbon-neutral. I congratulate it on that initiative.

In conclusion, I go back to the gravity of the situation. The lack of action that I have spoken of has extended to sector-specific support, business rates relief and airport retail. Even at this stage, I still urge the Government belatedly to follow up on their promises with action. As the Minister himself has said, pre pandemic the country’s aviation sector was the third biggest. The Government’s inaction has ensured that it will not be, as we move out of the situation. It is time to listen to the industry and our aviation communities and map a future that ensures sustainability, economic growth and job security.