Aviation

Julian Sturdy Excerpts

Wednesday 4th July 2012 Westminster Hall

[Mark Reckless]

Higher APD on short-haul flights from Gatwick and particularly Heathrow could allow airports beyond the south-east to compete for marginal business that might make more sense at those airports, particularly the leisure flights of people based in the midlands and the north who are flying point to point. Similarly, if we deregulated our international air agreements, there would be a better chance that intercontinental networks would base themselves at Birmingham airport, for example, which now has a longer runway.

[Julian Sturdy (York Outer) (Con)]

My hon. Friend makes a powerful case. An argument is that regional airports across the country will take up some of the slack. My airport, Leeds Bradford, has invested heavily—£11 million—in expansion and has new links to Heathrow. Is it not the case that despite the important role that regional airports play across the country, they will not lessen the need for expansion in the south-east and London? Ultimately, people want to fly into the capital city of a country and we cannot get away from that fact.

[Mark Reckless]

Yes, I think that is right. My argument is that it is entirely conceivable to have two hubs. Heathrow currently has many more passengers and planes using it than most of the other supposed competing hubs. The problem is that the slot prices are very high and profits are being maximised by those who, under EU law, own the property rights in those slots. If instead we allow a second hub, and Gatwick is the more attractive and conceivable hub to develop, and both operate in that way, competing airlines would drive down prices and give many more links to emerging markets, rather than very thick routes to New York and Hong Kong. That is my view, but perhaps the Mayor of London has considered matters that I have not. Stansted, and potentially regional airports—Southend and, I am delighted to see, Luton are developing in this way—could take many more point-to-point leisure flights, rather than them flying from Gatwick, or even Heathrow. Why does Heathrow have so many flights to Orlando? Why does it have flights to Malaga or Larnaca?

There is a very strong case for Gatwick. Many regional airports can help with the load. The debate that we have been having about aviation has been horribly distorted by what I am afraid are preposterous efforts by the Mayor of London to put the Thames estuary airport on the agenda, 10 years after it was categorically ruled out, and by the issue of Heathrow. Very strong vested interests want expansion at Heathrow. There are some economic arguments for the country as a whole for expansion there. However, there are costs, in terms of those living under the flight path, and in terms of our political promises; and the value of politicians sticking to what they promise is strong.

As to what the Transport Secretary says, and the argument that “It is all very well talking about a third runway at Heathrow, and mixed mode, but what is the next step?” it is incumbent on those who want expansion at Heathrow to say what happens in 30, 50 or more years. The reason the Secretary of State does not get the answers is that those with a vested interest at Heathrow—BAA and British Airways—do not want unlimited expansion there. It would undermine their monopoly position. The idea of going for mixed mode is attractive to BA—not necessarily to BAA, because it does not get the higher regulated capital. A third runway allowing marginal expansion of perhaps another 20 million passengers is attractive, because it maintains the value of the slots but allows them to develop. My hon. Friend the Member for Spelthorne (Kwasi Kwarteng) may want to discuss the fact that if we want Heathrow to be a mega-hub, perhaps remaining the biggest in the world and taking on Dubai as well as competitors in Europe—there are strong arguments against that, particularly from the point of view of people who live in the area, and the environment—it could mean taking over RAF Northolt and putting in several runways linked into Heathrow, as a long-term single giant hub solution.

Despite arguments that two hubs are not ideal, that is a far better solution than complete constraint on any expansion, or only looking after the interests of Heathrow. If we were to see the Oneworld alliance at Gatwick— short-term expansion is being done very well at the moment, and there could be longer-term expansion, but only once the 2019 agreement runs out—it would be a much more sensible way forward. There is a basket of other options, all of which make more sense than harking back to the preposterous estuary airport proposal, or looking at UK aviation solely through the issue of a third runway at Heathrow.