Air Transport (Northern Ireland)

Jim Fitzpatrick Excerpts

Thursday 27th June 2013 Westminster Hall

[Mr Burns]

Treasury.

[Jim Fitzpatrick (Poplar and Limehouse) (Lab)]

Stereo.

[Mr Robertson]

The Treasury is all-powerful. The level of air passenger duty was reduced to that for short-haul flights, and the Government have since devolved decisions on air passenger duty to the Assembly, so it can decide how it wants to play it. That reduction saved that route. I pay tribute in particular to the Select Committee members from Northern Ireland, who put pressure on me as Chairman, allowing me to put pressure on the Government. We saved that route, but it was a close-run thing that demonstrates how important—how big an issue—air passenger duty is.

Okay, we saved that route and that is important, given the relationship with America, but 98.5%—the vast majority—of Northern Ireland passengers take short-haul flights. Many witnesses cited air passenger duty as a major problem and a major cost, particularly for people who travel an awful lot.

I have made mild criticism of the Government so far. They inherited a massive deficit from the previous Government and, as we saw yesterday, it is difficult to cut taxes at this moment. We fully understand that. However, I stress to the Minister—although we are glad that the Transport Minister is present, and we know that three Ministers cannot be here, we could have done with a Treasury and a Northern Ireland Minister here, too—that air passenger duty is important. I hope that he takes that message back to the Treasury, to see what can be done to lower this burden on the people of Northern Ireland.

The Committee also considered visas and tourism, which is important to Northern Ireland and, indeed, to the Republic of Ireland. Of course, the Republic of Ireland, the United Kingdom, the Channel Islands and the Isle of Man are not in Schengen, but in what is known as the common travel area. Although that is helpful, people coming from other countries to Ireland—it is a bit more complicated than this—may need a further visa to get into the United Kingdom, and vice versa.

Again, the Government agreed with our recommendation and are already acting to have discussions with the Government of the Republic of Ireland, to see if this situation can be made simpler. Obviously, there has to be a uniform security policy surrounding the common travel area, if we go down that route, but we encourage the Government in that regard. Of course, the island of Ireland is promoted as one destination in respect of tourism. There is nothing wrong with that, even for Unionists like me. It is sensible. However, we feel that there can be more simplicity with regard to travelling to both the UK and Ireland.

I thank the Committee for all its hard work in compiling this report. I hope that I have stressed the importance of rebalancing the economy in Northern Ireland and of the role that air transport plays in that.

--- Later in debate ---

[Jim Fitzpatrick (Poplar and Limehouse) (Lab)]

It is a pleasure to see you in the Chair, Mr Amess, and it is a delight to follow the hon. Member for Belfast East (Naomi Long). She made reference to most of the report’s key points, which I will also refer to when I comment on the report, and she raised several other issues that I hope to cover. I thank the Chairman of the Northern Ireland Affairs Committee, the hon. Member for Tewkesbury (Mr Robertson), for the report and for his explanation of it: it is clearly a work of some significance. It is a good to see the Minister in his place to respond to the debate, and I hope not to be too long in my contribution, because responding to the points that have been made is clearly a matter for the Government.

I want to make two non-financial declarations, Mr Amess. First, I have family in Belfast, not too far from the constituency of the hon. Member for Belfast East, in Holywood. Secondly, I say to my hon. Friend the Member for Vauxhall (Kate Hoey) that I sailed from Southampton to Belfast last year to help celebrate the opening of the Titanic Belfast museum, which is a must for anyone interested in British history, British shipping or British tourism. Going to see it was a great opportunity that my wife and I took.

My hon. Friend, along with the hon. Member for Belfast East and the hon. Member for Tewkesbury, made some powerful points on air passenger duty, and I will come back to those in due course. My hon. Friend the Member for Vauxhall also commented on links to north America and particularly, potential new links to Canada, which the hon. Member for Belfast East also referred to. I am sure that the Minister will come back to those links in due course.

My hon. Friend the Member for Vauxhall asked for the Opposition’s view on APD. I know that the Minister would say the same thing as I would; it is a Treasury matter. However, I have had meetings with shadow Treasury Ministers, and the official Opposition policy is that we have given a commitment to undertake a review of APD, because there is an understanding—I am sure with the Government as well, because of the comments that they have been making—of the impact that APD is having on tourism, industry and connectivity. The hon. Member for Belfast East made significant comments on the Oxford Economics report, the PricewaterhouseCoopers report and what APD is doing, as well as whether it should be rebalanced and whether that could provide a greater incentive for the UK economy to grow. I have no doubt that colleagues in the shadow Treasury team are keen to look at those issues.

The hon. Lady made some points reinforcing the report’s recommendations, and I will try to refer to what she said briefly in my review of the recommendations. One thing that I will say is that from my time as aviation Minister, between 2007 and 2009, I know that the vast majority of airports take the issue of noise very seriously. We tried to reinforce the provisions, and the coalition has tried to reinforce the protection for communities around airports. My understanding is that the expansion of the airports in Paris, which we envy, because they have a greater capacity than we have, was partly dealt with by the appointment of a noise regulator for aviation in Paris, which provided the independence that the hon. Lady is asking for. This is about reassuring the public that somebody—whether the Government, an economic regulator, the Civil Aviation Authority, or whoever—is looking at the noise footprint and can ensure that it is within the contours; that all the arrangements, whether compensation, double-glazing or air-conditioning, that are in place for most airports are monitored appropriately; and that the matter is being dealt with efficiently.

On the report, the key question relates to recommendation 1 on connectivity. The Government, as I am sure the Minister will tell us, have set up the Davies commission, which is looking at capacity and connectivity. He knows that we think that it was a great idea and that we suggested it 12 months before they did it, but the fact that they got round to it is to their credit. We fully support it, and Labour’s position is that we will wait to see the outcome of the commission and its recommendations.

The only potential recommendation that we have firmly set ourselves against is if the commission comes out in favour of an estuary airport. I cannot imagine that it will, but that is one recommendation that we will not take forward. However, we will look at anything else that Davies comes out with, as the Conservative party has also said. I think that the Liberal Democrats are in a different place altogether on aviation. I am not clear exactly how they view aviation, given how important it is as an economic tool, which everyone who has spoken in the debate so far has recognised.

[Mr Laurence Robertson]

If an additional airport is not in Labour’s plans at all, the hon. Gentleman must be sympathetic to the idea of a third runway at Heathrow.

[Jim Fitzpatrick]

For the avoidance of doubt, we have said that we will look at whatever the Davies commission proposes, with the exception of a potential recommendation to build an estuary airport. We said that if that is a recommendation, we are sorry, but we are not persuaded at all by the evidence that that is the way to move aviation forward as an economic tool for UK plc. However, we will look at point-to-point, additional runways at Gatwick or Stansted, or a new hub airport—whatever the Davies commission comes up with, we will look at, but an estuary airport, from our point of view, is off the table.

Anecdotally, a range of events have been organised by a variety of different organisations, industry bodies, think-tanks and so on. The best story that I have heard from many such meetings was a question-and-answer session that included, on the top table, the chief executive of Schiphol airport. When he was asked what he thinks the answer to the UK’s aviation policy should be, his response was, “It’s not for me to say, but the recommendation I would give is that you should take your time and think about it long and hard.” The longer we take to make a decision, the more Schiphol is growing, day by day, week by week, and month by month.

As the hon. Member for Belfast East and my hon. Friend the Member for Vauxhall said, Schiphol advertises itself these days as the UK hub airport. It serves more than 20 British cities, while Heathrow only serves seven. Therefore, the connectivity from our regions is dwindling, and as slots from Heathrow become more precious and more airlines want to get in, that squeezes the ability for our regions and for Northern Ireland, Scotland and elsewhere to get in. Capacity is a big issue, and the connectivity points made in recommendation 1 are therefore significant.

On recommendation 2, we note the Government response. Naturally, I consulted my colleagues in the shadow Northern Ireland team and, if I may, I shall quote the points that they made to me. They said:

“The main political issue is Air Passenger Duty.”

They are aware of the

“keen debate on this around regional airports in the UK, particularly re Scotland.”

They say that their line to date, cleared with the shadow Treasury team, is that

“there are special circumstances in Northern Ireland. It is the only part of the UK that has a land border with another EU member state, which has lower rates of APD. Belfast City airport and Belfast International airport both compete with Dublin…on attracting airlines, routes and passengers. Conversely, it relies on…air transport for a link to the rest of the UK.

The government has removed”—

congratulations to the Government—

“APD on the long-haul New York flight from Belfast International airport, which we supported.”

That move is obviously well supported also in the Select Committee and by colleagues from Northern Ireland.

My colleagues in the shadow Northern Ireland team go on to say:

“We are sympathetic to the argument for reducing APD on all routes from Northern Ireland but would need to examine it fully, including the impact lowering the rate would have on the block grant. There are other options including looking at ‘protected routes’ that already exist in the UK for the air link to the Scottish islands, for example. Belfast-London Heathrow would be the obvious one for this.”

I cannot imagine that the Minister will say very much different.

On recommendations 3, 4 and 5, the Government response says that they concern devolved matters, and clearly that is the case. With regard to recommendations 6 and 7, I think that I covered the relevant points in my comments on APD. Recommendations 8 and 9 concern a key issue, and obviously the Government say so in their response. That matter is very much part of this debate.

On recommendations 10 and 11, we are told:

“The Government notes the comments on these areas”,

which I think is a very erudite thing to do.

As I said at the beginning of my speech, this is an important report. I am pleased to be here to contribute to the debate. I thank hon. Members for their comments and the Chairman and his Committee for producing the report. Like them, I look forward to the Minister’s response.

--- Later in debate ---

[Mr Burns]

The hon. Lady is extremely charming and in many ways intellectually seductive. She too has been a Minister. There may be only four close honourable friends of mine sitting in the Chamber, but unfortunately the walls have ears. I have always found that it is extremely wise when one is a member of a governing Administration to be bound by collective responsibility, which I happen to believe in as well; one fully understands the merits of the cases that the Government put forward as their policy and one fully supports them. I hope that explains to the hon. Lady that what my right hon. Friend the Chancellor had to do was due to the unsatisfactory, if not catastrophic, economic situation we inherited in May 2010. We have had to take some tough and difficult decisions. He is right, because it is right that we address the problems of the debt and the deficit.

I shall move on to the probably more neutral subject of aviation policy frameworks. Overall, the Government want aviation to continue across the country. To that end, we continue to deliver: we have delivered the Civil Aviation Act 2012, to bring the regulatory framework up to date, and we are implementing the recommendations of the south-east task force. We have also acted to ensure that the Northern Ireland aviation sector remains competitive. We plan to create an economic climate that enables people to travel and to use aviation to conduct business and visit friends and family as easily and cost-effectively as possible. Many people in Northern Ireland are concerned, as those in the rest of the country are, about capacity, particularly capacity in London and south-east England. Although it is across the Irish sea from Northern Ireland, capacity there does, as hon. Members have said, have a knock-on effect on those who wish to fly long-haul from Belfast and other parts of Northern Ireland to the rest of the world. They will frequently travel to London to meet their connections and then travel on or, as hon. Members have said, in some cases they go to Dublin.

The Government believe that maintaining the UK’s status as a leading global aviation hub is fundamental to our long-term international competitiveness. To make decisions, we need our evidence on the way forward to be as up to date as possible. Dealing with airport capacity, increasing the size of existing airports or creating new airports is highly controversial and arouses strong emotions. It is essential that we get it right, which is why I welcome the comments from the hon. Member for Poplar and Limehouse on his party’s attitude to how we are moving forward, but I exclude from that welcome the comments he made about Boris island; I must be totally independent, so I do not want to comment on any option and compromise that independence.

[Jim Fitzpatrick]

The only difficulty we have with the Davies commission is the timetable the Government have given it to arrive at its conclusions, which is after the 2015 general election. Like Mayor Boris Johnson, the CBI and the aviation industry, we would much rather the deadline were brought forward to before the general election, so that parties have an opportunity to examine the recommendations and include them or otherwise in their manifestos, and people can have the opportunity to decide.

[Mr Burns]

I hear what the hon. Gentleman says, but perhaps I should let sleeping dogs lie; he kindly did not mention that topic in his comments. The time scale that has been given, with interim recommendations for the short term announced at the end of the year and a full-blown report with recommendations in the summer of 2015, is the right one. On a very complex, difficult and controversial subject, the commission must have the right amount of time to assess fully all the evidence and come to a proper decision, rather than rush it for an artificial, more short-term deadline. I fear that if it had had a shorter time scale, all those who did not like whatever recommendation the commission made, would accuse it of a botched job because it was a rushed job, because it did not have enough time.

[Jim Fitzpatrick]

Forgive me, Mr Amess, but I must comment that the Davies commission was appointed more than 12 months ago. It has a three-year job, but there is no way that it takes three years to arrive at conclusions on an issue such as aviation capacity in the south-east. There is so much evidence available. Three years is far too long. The timetable is a political stitch-up to get past the general election, because the issue is a deal breaker for the coalition. That is the reality in politics. I am not knocking it; it is just where we happen to be. The timetable could have been shorter and that would not have truncated the opportunity for a full, thorough and comprehensive examination of the issues by the commission.