Air Passenger Duty

Jim Sheridan Excerpts

Wednesday 23rd October 2013 Commons Chamber

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

I congratulate my hon. Friend the Member for East Antrim (Sammy Wilson) on securing the debate. As usual, the hon. Member for Na h-Eileanan an Iar (Mr MacNeil), who is no longer in his place, blames everything on the Westminster Government. I noticed that a number of right hon. and hon. Friends found that rather funny. But it is not funny to anyone who lives and breathes amongst the people who want to break up the UK. The people of Scotland want a serious Government with serious politicians, and that is what we are hoping for. I do not share the hon. Gentleman’s view that in September next year people will vote for independence. I sincerely hope not.

Several hon. Members have referred to the devolution of APD, which I will keep an open mind on. If it proves to be to the benefit of the people of Scotland, fine, let us go ahead and devolve APD to the Scottish Parliament. But one question has to be answered, and perhaps the Minister will do so when he replies. If it is devolved, what proportion of money will come out of the block grant to pay for that? Someone, somewhere has to tell us exactly what that will cost. If APD is devolved and it is abolished, that money must come from the health service, education or somewhere else. It would be helpful, when we start blaming the Westminster Government for all our ills, if somebody from the separatist party told us where the money is going.

While I am on the subject of other countries, I have a document here that says clearly that in Malta APD was abolished in 2008, and one of the reason given was that it was

“Removed following legal challenge from the European Commission. Tax described as discriminatory.”

It would be helpful to know the reason for that. One aspect of APD that I find particularly discriminatory is that people in the north are being hammered twice. They have a double whammy if they travel through the London hub airports when going on to continental flights or flights to America. Even if there is no agreement to abolish APD, it would be helpful to abolish the double whammy.

Glasgow airport in my constituency contributes a great deal to the Scottish economy, including 5,000 jobs, but it pays more than £7.9 billion in tax. I am particularly annoyed that this will cost Scotland more than 2 million passengers and 5% of long-haul demand may be lost. Like a number of colleagues, I am finding that people in Scotland, particularly the holidaymakers and their families, are now going through Schiphol, Paris and elsewhere, which means that London and Gatwick are losing out. There is some impact on the London airports and it would be helpful if the Minister said how many people are involved.

APD also has an impact on Scotland’s tourism industry. Scotland has a lot to offer tourists. The Commonwealth games are coming to Glasgow in 2014, which many people from various parts of the world will attend. I am sure that they will not want to be affected by this tax either, and hopefully they will want to visit this country again. York Aviation estimates that 148,000 trips and £77 million in visit expenditure could be lost over the next three years and that by 2016 APD will cost the Scottish economy up to £210 million a year in lost tourism. One of the difficulties with this debate is that there is an awful lot of repetition, so I apologise to those in the Chamber and outside for using all these statistics, but unfortunately they have to be repeated. I take the view that the more we repeat something, the better the chance of achieving it.

This is about the whole United Kingdom, not just Scotland. Frontier Economics estimates that there will be around 3 million fewer trips each year to and from UK airports, that spending by overseas residents in the UK will fall by £475 million a year and that our GDP will be reduced by £2.6 billion a year, with the potential loss of 77,000 jobs. I do not think that this Government, or any Government, should contemplate the loss of such a significant number of jobs. A report by PricewaterhouseCoopers has shown that abolishing APD would boost the UK’s GDP by 0.46% in the first year, provide 60,000 extra jobs in the long term and increase revenues from income tax and VAT, with a net benefit of £500 million in the first year.

I make a plea to the coalition Government—unfortunately, the previous Government did not take appropriate action—to listen to what has been said on both sides of the House on the impact APD is having on the aviation industry and take appropriate steps to help our constituents.