Lord Davies of Oldham
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Civil Aviation Bill
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Lord Davies of Oldham
My Lords, as the Committee will recognise, we are anxious about Clause 9 and the two succeeding clauses, which relate to the very issue that we discussed under the previous amendment. This gives us a chance to explore much more fully the kind of issues that were opened up by the probing amendment a few moments ago. It may be looked on as something of a blunderbuss to fire at the Minister at this stage, particularly when he was so generous in his response to a question that I asked earlier in the House today. However, the blunderbuss is there simply because, like the noble Lord, Lord Jenkin, we are not quite sure what the implications of the Bill as it is drafted are. Therefore, we want as full and wide a debate as possible about an extremely important area.
The first question that the Minister needs to answer is: where is the demand for this provision of inter-terminal competition from the industry? All submissions that noble Lords will have received on this issue are, for a very good reason, critical of and hostile to the proposal that the Government have put forward. Airports require substantial investment. They need the confidence of investors in the resources that they intend to utilise. However, here there seems to be a proposal that the authority could promote competition between terminals when the whole structure of an airport’s finances is on the basis that such competition does not exist and, for very good reasons, ought not to exist. I shall elaborate on those reasons in a moment. However, what is more, the Bill says that if a decision is taken on this, it will be done through secondary legislation. We all know the limitations of secondary legislation in debating the fundamental principles of how an airport is to operate.
The noble Lord, Lord Jenkin, referred to the one airport that most us know has inter-terminal competition at present, namely JFK International Airport. He was quite mild in his assessment of the position there. Many other people are pretty critical of just how expensive that airport is, its lack of efficiency and the competition between terminals. It has the features to which the noble Lord, Lord Jenkin referred—a wide expanse of differentiation between terminals and a large number of them. However, that still does not mean that many of us, and much of informed opinion, cannot see the advantages that have been derived there from such competition. Representations from the industry show that it is extremely critical of this proposal. The Minister used the phrase “future-proofing” as the reason for this potential development, but the trouble with that is that it might cause disruption, consternation and anxiety here and now against a most uncertain future. When airports have made their representations on this issue, they have been pretty forthright about the disadvantages.
First, they foresee the potential for a substantial increase in operating costs because the economies of scale that airports are able to realise in their present arrangements through their ability to optimise capacity across all their terminals will be lost. That would be a substantial disadvantage to passengers. Secondly, inter-terminal competition is conceivable only where there is significant spare capacity. If one target for this is London Heathrow, “spare capacity” is just about the most inapplicable concept one could think of. The Minister should tell us where he thinks there is a large airport with more than one terminal that has sufficient spare capacity to be able to adapt to this situation. Where there is any spare capacity, the airport operator has an element of freedom to deal with the exigencies of particular situations. The Minister will have to explain the rationale behind Clause 9.
Moreover, the Minister will be all too well aware that airlines have very different needs. The reason an airport has different arrangements in its terminals is because it seeks to cater for the range of different needs of the various airlines. It will want to be in a competitive position so as to attract airlines through these differences. It is clear that no-frills operators have different needs from those who operate a full service on long-haul scheduled carriers. A single operator can accommodate these differences. I shall give one example. One of the terminals at Manchester airport is set up for holiday traffic. Because of the nature of the arrivals and departures of those flights, Manchester has made specific provision in the terminal to cope with it.
It must be recognised, of course, that difficulties can arise when airlines move. They have the freedom to do so and they exploit it to move to different airports. Gatwick made representations to the Committee and the Government indicating that when Delta, a large airline, quit Gatwick, that had a significant effect on its traffic and accordingly it had to make considerable changes. To adapt terminals to accommodate all sorts of traffic would be expensive. It would run counter to the investment that has already been made in our major airports.
There are other anxieties about the Government’s proposals. Obviously, when planning is carried out for airport development, it will not be easy to put forward proposals which envisage the possibility of a substantial section of the airport—one of its terminals—being sold off and therefore being subject to a different strategy from that in which people have invested. It also affects the airport in dealing with its suppliers. Airports can strike deals with significant suppliers of the very large amount of commerce which is transacted within them. Under the proposal which is envisaged here, these arrangements could be severely disrupted. One terminal would potentially deal with one group of suppliers and another could deal with another group of suppliers.
We do not feel that the Government have taken on board the industry’s anxieties about a piece of future-proofing which appears to be of potential benefit to the Government in terms of legislative time but has very little to do with the actual operation of airports. The Government are clearly not able to identify it as a demand within the industry. It would cause severe difficulties. There have been difficulties just on the relatively minor, if still important, issues of airlines choosing under the free market, as they are entirely entitled to do, to change their requirements and move to another airport. The concept of competition between terminals takes us a massive stage further.
The Minister indicated in the debate on Amendment 17 that he thought that it was unnecessary, and that the clause provided an opportunity for action when it is needed. I am not at all clear that a case has been made for action in terms of competition between individual terminals. I cannot see just where the demand is coming from at this stage. However, I am aware of airports’ anxieties about losing a great deal from the arrangements, and the fact that that the arrangements might prove largely unworkable.
Again, I apologise to the Committee for the fact that our amendments are not more precise on these issues, but this a pretty general problem. That is why we thought that it would be advantageous for us to speak against the clause standing part in Committee, in order that voice could given to the general issues which are raised by Clause 9 and the immediately subsequent clauses.
Earl Attlee
My Lords, I thank noble Lords for their contributions but I am afraid that I must oppose the amendment and support the Question that these important clauses stand part of the Bill.
Inter-terminal competition may be some time off and the Bill makes no provisions about timing. However, it is important that we future-proof the legislation. The noble Lord, Lord Davies of Oldham, talked about disruption and consternation. Clearly, this would not be in the interests of passengers, and the CAA would therefore not allow such competition because it would be in conflict with its primary duty to the passengers and owners of cargo.
The noble Lord said that different airlines have different needs. He is, of course, quite right. Some airlines want to run a premium service and others want to be no-frills. However, the CAA will have to strike the balance between those differing requirements as well as replicate the effect of competition.
The Bill does not, in general, require inter-terminal competition but does accommodate the possibility. Promoting competition between terminals under the Bill would not happen if the cost implications of doing so meant that it would not benefit the passengers, again under the CAA’s primary duty. In the circumstances postulated, there is no question that the CAA would seek to require inter-terminal competition. If, however, an airport chose, say, to lease a terminal to a third party, the Bill would remain in service, and I will come back to that in a moment.
Clause 10 empowers the CAA to determine, by applying the criteria set out in Clause 9, including in cases where one or more separate entities have some form of management control over that area. Clause 11 contains provisions for the publication of operator determinations made under Clause 10 by the CAA. Clause 12 empowers the CAA to make operator determination in advance, on the basis of circumstances that may not yet have arisen.
The amendments to Clause 12 seek to remove the CAA’s powers to carry out an advance operator determination. However, before I get on to why the amendments are not desirable, I wish to reassure your Lordships on why “standard” operator determinations under Clauses 9, 10 and 11 are a necessary part of the legislation. These clauses are important for regulatory certainty, enabling a person to know whether they are the operator of an airport area for the purposes of Part 1. Otherwise, in difficult cases it will be uncertain who the operator is and who is not, and therefore who is and who is not subject to economic regulation. This means that they cannot be clear as to their legal obligations, and neither they nor their financial backers can know with certainty whether they will be subject to economic regulation.
The clause is not focused solely on the possible future scenario where intra-airport competition can be introduced. For example, it could apply where a whole airport was leased and some management functions were split between lessor and lessee. However, noble Lords have rightly pointed out that these clauses are important for ensuring that the Bill allows for the regulatory regime to work in a scenario where there are multiple operators of different airport areas at one airport—in other words, where there is inter-terminal competition. Inter-terminal competition is more likely to lead to more complex ownership arrangements.
I have already mentioned that it was a recommendation of the Competition Commission in its BAA Airports Market Investigation report of 2008 to allow for the regulatory regime to function where inter-terminal competition is present. The present legislation, the Airports Act 1986, does not allow for this possibility. If we, the Government, had not made these provisions, no doubt noble Lords would suggest that we should have done so, praying in aid the Competition Commission’s recommendations. It is important to note that these clauses do not empower the CAA to introduce inter-terminal competition; they merely ensure that if inter-terminal competition becomes a reality, the regulatory regime can accommodate the scenario.
Clause 10 empowers the CAA to make binding operator determinations on the basis of the circumstances at the time the determination is made. However, this is considered insufficient where a person wants to know whether they will comprise the “operator” in the event that they take some control over an airport area. Against this background, to allow for greater regulatory and commercial certainty, Clause 12 empowers the CAA to make advance determinations—that is, determinations on the basis of circumstances that have not yet arisen. This would include a determination that, if a lease were executed with specified terms, the lessee would or would not comprise the operator.
The first amendment would deprive the CAA of the power to make an advance operator determination. The Government cannot agree to this because it would increase regulatory uncertainty and possibly stultify commercial transactions. I therefore urge noble Lords to withdraw their opposition to the clauses.
Lord Davies of Oldham
My Lords, the Minister made the best fist that he could of a fairly weak argument. Of course, I recognise the merits of the clauses, in that he made it clear that it is important to define the operator and to know whom we are talking about. Who could possibly gainsay that proposition?
In objecting to the clause, I am not objecting to the sense that lies behind the elements within the clause to which the Minister addressed some of his remarks. I indicated that in opposing the clause I recognised this to be a fairly blunderbuss approach and that we have not refined our opposition in amendments—something that we may do in due course, perhaps on Report. However, I say to the Minister that in this general debate anxieties have been expressed across the Committee, and he has not allayed those anxieties at all, apart from—
Lord Trefgarne
I am afraid that the noble Lord is mistaken. The Minister has very much allayed my anxieties about this matter. I see these clauses as facilitating competition between terminals at a particular airport. What is the matter with that? When the operator comes to choose the terminal from which he wishes to operate, he will select the one that offers him the best deal—maybe it has the best duty-free shops or is the cheapest—and these benefits will be passed on to the passengers. I am very much in favour of these clauses and I hope that the noble Lord will not press the question of whether they should stand part of the Bill.
Lord Davies of Oldham
I am delighted that the noble Lord had his anxieties allayed. They are obviously not as acute as those on this side of the Committee. In particular, if the noble Lord is all in favour of inter-terminal competition, perhaps he will ask the Minister to identify just where this is a raging success that we would want to encourage. The only specific example that we have so far is subject to considerable criticism. As the noble Lord indicated, airport operators are accurately defined in the legislation; I will not gainsay the necessity of that. None of them speaks well of future-proofing what they regard as a disadvantageous element of the Bill, which will introduce the possibility of inter-terminal competition. In particular, by putting it in the Bill in the way that they have, the Government limit parliamentary debate to secondary legislation. We know the limitations of that.
However, I seek to identify that this concept is a significant departure from how any British airport is run at present, and from how any successful airport is run elsewhere. Unless the Minister produces some evidence of how competition works to the benefit of the passenger—which he signally failed to do in his earlier contribution—the Committee will recognise that, far from my anxieties being allayed, they are more pronounced. Of course, I recognise that objecting to a clause standing part—or three clauses in this case, which is the first time that I have engaged in such an extensive operation—is something from which I shall have to resile fairly promptly. However, I do so to air a significant aspect of this debate. I say to the Minister that we are so dissatisfied with the response at this stage that he must assume that we will take this issue further on Report.
Earl Attlee
I am curious about the noble Lord’s attitude to the Competition Commission’s recommendation that we should provide for inter-terminal competition. Does he support that view or not?
Lord Davies of Oldham
Of course, I recognise the role of the Competition Commission and we applaud a great deal of its work. However, when it makes recommendations, one must also consider the industry’s likely response to the proposal that is being put forward. All I say is that the noble Earl has not identified any aspect of British industry that considers this to be an intelligent and sensible development. Nor is he able to identify any example from elsewhere in the world where this form of competition has redounded to the benefit of the consumer.
Lord Trefgarne
With the noble Lord’s permission, I will cite an example. Many years ago, I landed my aeroplane at Miami International Airport. I had not chosen the terminal at which to land. I negotiated with three different terminals over the radio, found the cheapest and in I went—very good, too.
Lord Davies of Oldham
My Lords, that is a very good illustration. If the noble Lord had also indicated that hurricanes were raging at the time and he was able to put down with the help of the airport, I have no doubt that we would all regard that as an extreme benefit.
However, airports always adjust to emergencies, so if the noble Lord is saying that as the pilot of a private plane he can see stupendous advantages in inter-terminal competition, how many people do I have to count in order to introduce into legislation a very significant development? Is it is the number of people who own and fly private aircraft? Our consideration of government legislation ought to be undertaken on a wider perspective than that and the Government’s defence of it ought to be a jolly sight wider too. But, of course, I shall withdraw my opposition to the clause standing part.
Lord Davies of Oldham
“( ) A licence must include an obligation on licence holders to procure and publish annual surveys of passenger satisfaction, including but not limited to—
(a) baggage handling services, and(b) arrangements for delays to affected air passengers.”
Lord Davies of Oldham
My Lords, I shall speak also to Amendments 25 and 26 in this group. Amendment 24 is fairly straightforward. We should remember that a principle of the Bill is ensuring customer satisfaction and the welfare of passengers. We seek through the amendments in this group to make the possibility of those satisfactions greater by ensuring that there is an annual survey of passenger satisfaction that would include baggage-handling services, which we recognise are outside the control of the airport operator because they are under private contract, and arrangements after delays to air passengers.
All forms of transport can produce their irritations and even the most trouble-free journey can attract criticism. However, dissatisfaction with air transport hits the headlines from time to time—regular travellers, given their experience, probably feel that it does not hit the headlines often enough. Amendment 24 would require the airport authorities to carry out regular surveys in order better to inform them on the nature of consumer dissatisfaction. The surveys would cover all delays and the arrangements made as a consequence, because there is no doubt that delay is an all-too-common feature of air travel and causes a great deal of disturbance to passengers.
There are commendable parts of the Bill and the Minister appreciates that we are broadly in favour of it. As we indicated on Second Reading, we accept its principles. One of the principles is the value of open data and publishing information that will advance the service provided by airports. There is no doubt that information about delays and the experience of the services offered at airports can do two things: improve the performance of the airport that is subject to criticism through these reports and inform the passenger of comparative performance. Given that airports can be competitive in terms of the services that they operate and the airlines that fly from them, this information for passengers should be welcomed.
I put forward these principles in the knowledge that other Members of the Committee are likely to be well disposed towards something more than just freedom of information requests and consider that accurate information on performance should be volunteered to the general public. We all know that when things go wrong, they often go very badly wrong indeed. In its pre-legislative scrutiny of the Bill, the Select Committee on Transport in the other place said that, where possible, airport licences should be structured to address key areas of passenger satisfaction. The surveys that are carried out demonstrate, in the main, a positive attitude to the flight experience, because people are successful in getting from one point to another. Not many people do that on a daily basis, although I have no doubt that a few benighted souls are forced to depend on air travel to that extent. However, levels of satisfaction show less than optimum agreement on baggage handling, which can often prove to be a massive irritation, and on delays at border control, which is a substantial issue.
I am conscious that in the other place it was indicated that the Bill cannot impact directly on government policy on immigration control and the Home Office’s operational control of UKBA. I respect that limitation. However, we cannot discuss issues about airport delays without making reference to the obvious fact that security considerations often prove to be the source of some of the most irksome delays. Therefore, when the Minister replies, I hope that he will not just fall back on the point that I have already conceded—that this legislation can deal with them directly—but that he will appreciate, when considering the issue of the welfare of passengers and the satisfaction that they derive from their flights, because problems occur because there has not been sufficient anticipation of the demands made of the border force, because there are insufficient officers on duty, or because a decision is taken, for security reasons, that every single passenger, whatever their category, should be subject to exactly the same controls. We are bound to acknowledge that this is of concern to us. We all have the welfare of the industry at heart, but this is a subject of very considerable anxiety among passengers.
I have discussed this issue externally in order to get a slightly more objective view, rather than just being critical of the arrangements in the United Kingdom. I have friends who regularly experience the delights of entering the United States of America—delights that often translate into great appreciation of the country once they are there but scarcely describe the experience they often encounter at US airports. British people enter as aliens, of course, and are subject to what often looks like a somewhat arbitrary operation on the part of the American authorities. Huge queues develop and it is not unusual for people disgorged from aircraft to have to wait for several hours in queues for entry into the country. I take it that we seek to make representations on behalf of British citizens when these problems arise, so we ought to pay the same due consideration with regard to flights into Britain.
Amendment 25 would require,
“the holder of a licence to develop passenger welfare plans”.
This was a recommendation made by the Transport Committee following its pre-legislative scrutiny of the Bill. We pay tribute to the fact that the Civil Aviation Authority has made some constructive moves in this direction. It has established a consumer panel to act as a critical friend. We certainly would like to buttress the position of the Transport Committee, which is that the consumer panel ought to focus on the welfare of passengers. The panel was established recently and, as I say, its purpose is to act as a critical friend. It provides a consumer perspective on all aspects of the CAA’s work, which is very welcome, and in particular it is meant to concentrate on the passenger experience and the enforcement of consumer protection legislation. The panel members are looked to to provide a source of challenge to the Civil Aviation Authority on how to identify consumer interests and to ensure that they are reflected in the authority’s work. However, in this legislation the Government have not included passenger welfare plans as part of a licence for airports. They simply claim that the CAA will draw up licences to cover such welfare.
Earl Attlee
We will see what happens in the next reshuffle.
My honourable friend the Immigration Minister is reviewing what additional data may be published by the Home Office and shared with port operators. Meanwhile, the border force has responded to recent problems in a number of ways. It is tackling short-term peaks with a pool of trained staff, working with airports and airlines to ensure that they provide more accurate passenger manifests and flight schedules so that the border force can flexibly deploy staff at the right times and places, creating a new central control room for the border force at Heathrow that uses mobile teams for rapid deployment, and implementing new rostering and shift patterns. The border force is also working with Gatwick and Heathrow airports to improve passenger flows, using more specific measures such as e-gates and other biometric checks.
There can be no doubt that passengers want efficient baggage-handling services when they travel by air. The experience of recent years has also demonstrated how vital it is that airports prepare effectively for potential disruption. It is clear that the aviation sector as a whole needs to have effective means of dealing with passenger welfare during disruption of services. While I can therefore understand and agree with the sentiment behind these amendments and what noble Lords have said, I cannot recommend accepting them into the Bill. The text of the Bill already provides the most effective means of protecting passenger interests in relation to the matters raised.
Clause 18 and the licensing regime as a whole will give the CAA the flexibility to tailor licence conditions to the specific circumstances facing individual airports with substantial market power. This flexibility is an important means of minimising the distortions associated with regulatory intervention and ensuring that action taken by the CAA is proportionate. However, we also believe that giving the independent expert regulator flexibility and discretion in deciding the content of the licence is the most effective way to protect the interests of present and future passengers. If Parliament chooses to use this legislation to hard-code certain points in licences, it would constrain the regulator’s freedom to decide what priority should be afforded to different passenger concerns and what costs should be allowed for the delivery of competing consumer priorities. As the Minister of State said in Committee in the House of Commons, amendments such as these would make the licence system unbalanced because passengers care about a whole range of different issues. Moreover, a prescriptive approach in the Bill is likely to make it more difficult for the regulator to adapt its approach to the changing concerns of passengers. In 2005, who would have thought that volcanic ash would have been a major problem later on?
If we were to adopt these amendments, they would oblige the CAA to give greater weight to these factors than other matters that might become equally or more important to passengers in the future. This danger was recognised by the noble Lord, Lord Soley. Your Lordships can be very confident that the CAA will already use the new licensing powers proposed in the Bill to focus on, for example, operational resilience and passenger welfare in the event of extreme disruption—not least because of the CAA’s Clause 1 duties, as the noble Lord, Lord Davies, recognised. And why it would it not do so?
As we have discussed in Committee, in response to a request for advice from the Secretary of State, the CAA published an indicative licence in January to assist Parliament in its scrutiny of the Bill, and a copy has been sent to the House of Commons Library. At the request of the Department for Transport, the draft licence includes provisions on operational resilience. The proposals in condition 7 would require the licence holder to operate the airport efficiently and use its best endeavours to minimise detriment to passengers arising from disruption. The noble Lord, Lord Davies, mentioned disruption due to winter. When I visited Gatwick Airport before the most recent winter and saw all the new equipment in place, I was absolutely confident that the winter would be very mild.
It would also require the airport to draw up, consult on and gain the CAA’s approval for an annual resilience plan setting out how it would secure compliance with its obligations under the condition. The licence holder will then be obliged to comply with the commitments it has made in its resilience plan. The CAA sought initial views from industry in drafting the indicative licence. However, since Parliament has not yet concluded its consideration of the Bill, the CAA has not yet started to consult on proposed licence conditions for each airport that will be subject to regulation.
If the system proposed in the Bill is implemented, the CAA will consider the extent to which it is necessary or expedient to include conditions in a licence for operational resilience and other matters such as passenger welfare. The CAA expects that activities that might be expected to be part of the new licence regime would include taking into account other obligations on service quality standards, and the success of codes of conduct and voluntary arrangements being adopted by industry. Against this background we believe that putting specific requirements in the Bill on issues such as baggage handling and operational resilience could prove to be a disproportionate response that would place an unnecessary restriction on the CAA’s flexibility to develop proportionate and effective ways to address passenger concerns—and might even lead it to address the wrong ones.
In summary, the Bill provides the CAA—the body with the relevant operational expertise—after appropriate consultation, with the flexibility to determine appropriate and effective licence conditions. The amendments in this group could undermine our goal of giving the specialist regulator a flexible toolkit to protect the passenger. Therefore, I hope that the noble Lord will withdraw his amendment.
Lord Davies of Oldham
My Lords, I am grateful to noble Lords who introduced significant points, to which the Minister paid due regard—about as much regard as he paid to the points that I made in my opening speech. If through the amendments in this group I had sought to introduce microscopic instructions to the CAA on what it ought to do that would limit its capacity to fulfil its duties, I would quite understand the thrust of the Minister’s response. However, the first of the three amendments to which I addressed my remarks requires publication of an annual survey. This is not desperately specific but merely indicates that it would be a very good idea if the licence holder—the airport authority—gave some account to the general public of the effectiveness of its operation.
The second amendment suggests that the licence holder should develop passenger welfare plans. That is not specific; it merely indicates that it should be incumbent on the licence holder to fulfil the obligation that apparently underpins the Bill, which is to provide a better service to passengers. The third amendment merely suggests that support is necessary and should be provided for stranded passengers at airports. There is no Member of this Committee—including the Minister—who does not agree that action must be taken in this area. The Minister went so far as to indicate that strenuous efforts had been made to ensure that the numbers of such stranded passengers would decrease. I am not sure that Gatwick has the equipment to affect the climate and make our winters milder, but I know exactly what he meant. It now has the equipment to keep aircraft manoeuvring and able to fly, whereas over the winter that caused so much distress the airports did not have that.
We are merely asking for provision to be made for stranded passengers—an objective that the Minister says he shares—and I cannot think that the actions of the Civil Aviation Authority are cabined, confined or constrained by including these amendments in the provision on how the licence is granted. However, at this stage, I accept that the Minister is not as warm about these amendments as he is about the forecast for future winters, and I beg leave to withdraw the amendment.
Lord Davies of Oldham
“( ) provisions requiring the holder of a licence to prevent users of air transport services buying preferential access to check-in and security processes on an outbound journey and immigration control and baggage reclaim processes on an inbound journey.”
Lord Davies of Oldham
My Lords, it is my approach today to produce completely uncontroversial amendments, and I am sure that this will be the least controversial. I am not entirely confident that the Minister will accept it but I know that the sentiments behind it will be shared by all Members of the Committee.
The subject of concern tackled by the amendment is obvious enough, such are the difficulties at our airports at certain times. Heathrow, being the largest and dealing with the largest number of passengers, inevitably has the longest passenger queues, which are the bugbear of people entering the country. The proposal is that, if some people pay enough, they can bypass the restrictions. Surely that is so contrary to the main principle on which the coalition works—that we are all in this together—that not a single Member of the Committee will beseech the Minister to accept the proposition.
It is proposed that substantial amounts of money can be garnered by the airport by offering preferential opportunities to those who are prepared to pay. It is suggested that £1,800 will enable passengers to avoid the queues. Heathrow is thus offering a back-door service for wealthy air passengers. This does not appear in any of the normal communications to passengers but is offered discreetly to the well favoured. Wealthy air passengers can pay £1,800 to bypass the passport check queues.
I have already indicated to noble Lords that I recognise the limitations of the Bill with regard to the UK border force but this provision relates directly to the way in which passport checks are operated. Whereas some people endure queues of up to three hours because passport control desks may be understaffed, or because the pressures and anxieties surrounding the security position justifiably lead to more intensive scrutiny of passengers coming in, rich passengers can get through in minutes.
Border staff may be taken away from their regular duties to process this arrangement for the privileged, which is a VIP offering that Heathrow sought to keep secret. The airport should not pursue such strategies. It should come to an end. However, the best way of guaranteeing that neither Heathrow nor any other airport contemplates this heinous practice is to put it in legislation. I beg to move.
Lord Trefgarne
My Lords, while I am sympathetic to the noble Lord’s wish to ensure that there is no corruption through people buying their way through the airport, there are some people whom I would wish to have preferential treatment—for example, members of the Royal Family and the heads of state of other nations. How does the noble Lord think they should be accommodated if the restrictions that he proposes are put in place?
Lord Davies of Oldham
My Lords, I do not think that the issue of payment is likely to arise with members of the Royal Family or diplomatic staff because the arrangements for how they should be treated are agreed with the airport authorities. That is very different from saying that you can enhance the value of your ticket with extra money to get through the queue quickly. That is the practice to which I object. I am not saying that the Royal Family fit into that category. I imagine that it is also not the case for diplomats. We also have control over the process of entry to the country for air crews, but we do not expect them to take their turn in the queue because we recognise that special arrangements should be made for them. I do not want to exclude some special arrangements; I object to a scheme that enables those who are wealthy enough to purchase privilege.
Lord Berkeley
I suppose my noble friend is thinking in particular about those bankers who are now all over the press for possibly having committed criminal acts to fiddle the LIBOR. They are probably the only people who could afford to spend an extra £2,000 or so to save five or 10 minutes—or maybe several hours—coming into the country. There is just one thing that I would add to this. There is some benefit in having famous people who are prepared to speak out going through the same process as everyone else. Occasionally, they get so fed up that they go to the media and complain about it. I suspect that part of the reason why things are getting better at immigration in airports is that one or two people have had the guts to speak out and say, “This is iniquitous”. If these people were tempted to jump the queue by paying £1,000 or £2,000, we would lose that. My noble friend has made a very strong argument for having this in legislation on the basis that people should not pay extra for special treatment.
Lord Trefgarne
Perhaps the noble Lord will tell us how he proposes that disabled people should be handled. They often have special provision at airports, which is necessary and very proper.
Lord Davies of Oldham
On the latter category, we are shortly to debate the arrangements for the disabled, and I hope to provide reassurance. I accept what the noble Lord is saying; of course there are special arrangements for the disabled. We all know why it is necessary for the law to be strengthened in that area, and I shall be proposing an amendment to deal with that matter.
The situation that I have identified is not concerned with people going through different routes according to their ticket, but the question of how one goes through the state’s immigration controls. The contention that you are less of a security risk because you are wealthy is dubious. After all, I seem to remember Bin Laden did not come from a totally impecunious family. It is not the case that those who have a great deal of money are better security risks. Why on earth should everyone else, for the necessary security of the nation, be obliged to suffer some of the privations that occur from time to time? I fail to understand how one can market a package that guarantees that one is whisked through security.
Lord Berkeley
Does my noble friend agree that the key to the amendment is the word, “buying”. There is nothing to stop the provision of different queues for first-class passengers or others at check-in or security. The question is: have they paid extra to go through that facility rather than for the facilities on the flight?
Earl Attlee
My Lords, I am aware that a similarly worded amendment was tabled in Committee in the House of Commons, but that related to Clause 83, on provision of:
“Information for the benefit of users of air transport services”.
The stated aim of that amendment was to close a perceived gap in the information that will be published under that clause on what passengers can expect to experience when departing or arriving at an airport, especially in relation to how long they should expect to wait to have their passport checked. The Government supported the broad intention of that amendment. Giving consumers more information on the quality of service provided by airports and airlines will help to maximise the benefits that markets deliver to passengers. However, the Minister of State ultimately resisted the amendment on the basis that the Bill already enables the CAA to require the collection and publication of information on check-in, baggage handling and security queues. He further explained that the UK border force, the authority responsible for border controls relating to arriving and departing passengers and goods, is responsible to Ministers and Parliament, and said that this is a more effective and appropriate means to hold the UK border force to account than giving the CAA power to oversee its activities.
The amendment today goes further than the previous one by seeking to prevent users from buying preferential access to check-in, security, immigration control and baggage reclaim processes. In considering the amendment, the Committee should note the distinction between check-in and baggage reclaim processes, and aviation security and border-control processes—the latter being subject to exacting standards enshrined in legislation. For example, airports are required, pursuant to international standards and EU and domestic regulatory requirements, to ensure that all passengers undergo security screening to specified levels. This is subject to monitoring and enforcement through security inspections and tests by the regulator. Legislation also requires full travel document checks to be conducted on all passengers, including all British citizens, arriving at the UK border. As the Minister of State made clear in the House of Commons, the security of our borders and the checks that need to be undertaken to protect us from those who would enter our country to do us harm are treated with paramount importance.
I am aware that the BAA runs a VIP suite scheme at Heathrow. The UK border force does not charge BAA or the VIPs any money for the provision of this service, nor does the BAA cover any border force costs. I will write to the noble Lord, Lord Davies of Oldham, with full details of the number of years that these arrangements have been in place. As long as standards of security and immigration are maintained at all times and in respect of all passengers, the Government do not wish to prevent the market offering access to these services, which are tailored to the needs of passengers. However, there is no question of reduced security, as suggested by the noble Lord, Lord Davies.
Your Lordships will no doubt be aware that a number of airlines offer faster check-in services to premium travellers who are willing to pay a premium for the service. The Government do not wish to prevent passengers benefiting from such products. If the concern is that the purchase of preferential access to check-in or baggage control processes would be an impediment to competition, the Bill already provides the CAA with the necessary powers to address that.
In summary, aviation security and immigration processes at UK airports must comply with exacting standards that are enshrined in legislation. There is no scope for passengers to pay to avoid these processes. The Government believe that the amendment goes too far in attempting to prevent the market offering access to these and other services that are tailored to the specific needs of users. I hope, therefore, that the noble Lord will consider withdrawing the amendment.
Lord Davies of Oldham
I am grateful to the Minister for his response, although I still believe that he is failing to recognise the context in which we find ourselves. That answer might have sufficed a decade ago, but as he knows only too well, we are operating a very stringent security regime at our airports. We all know the privations that occur from time to time. We know that people have to queue for hours on end because of the necessary requirements. The Government say that it is about security and the market has the right to provide preferential treatment for some. It seems to me that the concept of security is an obligation for every citizen. I do not see why there are favoured circumstances for a few, nor do I think it is conducive to the implementation of the security requirements if people believe that there is an inherent unfairness. The noble Earl made no reference whatever to that. Of course I recognise that no payment has been made by the airport to the Home Office with regard to this. However, if people are being transferred from heavily pressed desks to facilitate entry for those who have paid a premium, one should not be at all surprised that the difficulties occurring at airports are growing acutely. I beg leave to withdraw the amendment, but the Minister may come to rue the day.
Earl Attlee
My Lords, this is a minor and technical amendment and as such I do not expect it to be controversial. It seeks to make the drafting in sub-paragraph (2)(a) of paragraph 22 of Schedule 2 consistent with the rest of that paragraph. It corrects the omission of the words “information or evidence” from the phrase “matter, information or evidence”. This phrase can be found elsewhere in paragraph 22. So this amendment makes sub-paragraph (2)(a) consistent with the other provisions in paragraph 22 of Schedule 2, which delineates the circumstances in which the Competition Commission may allow new matters, information or evidence to be adduced in appeals brought before it. Paragraph 22 of Schedule 2 generally prohibits the Competition Commission from considering any matter, information or evidence in an appeal that was not in the appeal before the Civil Aviation Authority.
However, in common with other appellate jurisdictions, there are limited circumstances where, in the interests of justice, this general rule needs to be capable of being displaced. It is necessary for the power to displace this rule so as to be co-extensive with the scope of the general prohibition. I beg to move.
Lord Davies of Oldham
My Lords, I agree with the Minister. Try as I might, I can find nothing controversial in his amendment.
Lord Empey
My Lords, I shall speak also to Amendment 74. Members will, I am sure, recall that we had a debate in this Room in November last year on transport links between the regions and London. Subsequently, in December last year, I tabled a Private Member’s Bill, the Airports (Amendment) Bill, which was given a Second Reading in the House on 16 March.
The amendment’s fundamental aim is to deal with the situation whereby the regions of the United Kingdom do not have guaranteed air access to our principal airport at Heathrow. As your Lordships are aware, the issue of landing slots is controversial, with their ownership in some cases disputed. What is not disputed is that, particularly as far as Heathrow is concerned, airlines have the use of the slots and even put the value attached to them on their balance sheets.
There is no doubt that there has been a significant improvement in air access between the Greater London area and many of the regions, which is to be welcomed. However, the reality is that, while a number of airports have tried to expand their portfolio of destinations, Heathrow is currently the principal hub airport for the United Kingdom. As a consequence, when we consider the amount of money that the Government have put into regional policy, as well as the considerable resources which continue to be put in by the European Union—indeed, in many cases providing funds for infrastructure at airports to promote links between the regions and our national hub airport—it seems an anomaly that the Government have no powers to intervene to ensure that air access exists between the national hub airport and the regions.
That is a serious weakness. Things are changing that quickly in the airline industry. To take an example from my own city, Belfast, Members will be aware that British Airways took over British Midland Airways Ltd recently. A lot of controversy was created because people said that that could theoretically put the principal route between Belfast City Airport and Heathrow under threat. People argued that, as the slots are more valuable to airlines for international routes than domestic routes, there would be a long-term temptation to switch to those sorts of routes.
There was a second development a few weeks ago when Aer Lingus, which runs three flights per day between Belfast International Airport and Heathrow, decided to move to Belfast City Airport. That means that all the Heathrow to Belfast routes are now going from the one airport. If that was not enough, Etihad Airways put in a bid for a percentage of Aer Lingus and only two weeks ago Michael O’Leary said that he wanted to buy the whole of Aer Lingus. When we look at the profile of Etihad Airways and of Mr O’Leary, I am not confident that we could see a guarantee of our air access to Heathrow.
There is a major European Union dimension to this. As the Minister knows, I have been to Brussels twice in the past few months pursuing issues there because, by coincidence, they are looking at the same issue. In December of last year, the Commission produced draft regulations of the Parliament and the Council on common rules for the allocation of slots at European Union airports. They are looking at this and a number of issues at the same time.
If that were not sufficient, the European Parliament has produced an own-initiative report which was passed by the Parliament in May of this year, paragraph 23 of which says that it,
“considers it essential for regional airports to have access to hubs”.
That is exactly what I am trying to achieve through these amendments, because there is a serious weakness. It cannot be right that, as a nation, we invest heavily in trying to develop the commerce and tourism of our regions and at the same time leave in question one of the principal points of access, particularly for an area like mine where there is not the alternative of a train or of road. There is only travel by ferry or air. If you are trying to develop a region to be commercially attractive, it needs air access to the main hub.
Air access is entirely at the mercy of the airlines. The Minister has repeatedly said that the Government are not able to intervene. That is not satisfactory. It puts regions at risk. I have quoted one example of the significant changes in my own region in the past few weeks. That fills people with concern and creates doubt. Doubt creates a potential obstacle to investment, which we do not want to see.
I understand that the Minister has to have regard to the European dimension, which is critical. I visited the European Union two weeks ago and went to the office of Commissioner Kallas, who is responsible for transport, and discussed issues there, and on a number of occasions with Members of the European Parliament because they are engaged in a co-decision process. We happen to have a legislative vehicle passing through at the moment and they, by coincidence, are doing the same thing and looking at slots. There seems to be a unique opportunity to do something to ensure that the regions will not be left out in the cold.
I know that these are difficult issues. You are effectively interfering in the natural competition process, in so far as these slots are attributed by value and if you interfere with them you affect their value. That is why I met with people in Brussels who have specific responsibility for competition issues as well. All of these things we have to deal with. While there are perfectly good connections, and under EU Council Regulation 95/93 a public service obligation can be given to assist transport between one region and another should there be market failure, there is no provision to link a specific city to a specific airport, which is precisely what we need in our case. While there is no market failure at the moment, and I hope that no market failure will ever occur, the fact remains that a principal instrument of government policy—the promotion and economic welfare of the regions, which is also held as a common view by the European Union—is now entirely at the whim of whatever commercial operation happens to be going on within or between airlines. That is not a satisfactory situation, which is why I tabled Amendment 46.
Amendment 74 deals with the point that introducing my proposals would be against European Union regulations. Amendment 74 merely points out that the powers would reside with the Secretary of State but could not be implemented until they became compliant with European Union regulations. That, in essence, is what I am trying to achieve: that the regions are guaranteed access to the principal hub airport at Heathrow, and that we become compliant with European Union regulations, where Parliament has already expressed that it is essential for regions to have access to hubs. As for its part in the co-decision process, I hope that over the next year or so in Brussels we will be able to make the arguments that will make us compliant with European Union regulations. I beg to move.
Lord Davies of Oldham
Briefly, I have considerable sympathy with the case put forward by the noble Lord, Lord Empey. We appreciate that Belfast and Northern Ireland have a particular interest in air travel. I also draw the attention of the Committee to the fact that Scotland, and Edinburgh in particular, is also concerned about the reduction in services that may be attendant on commercial transactions on slots.
I recognise that this is a difficult issue for the Minister, particularly as we are divided on much of the guidance on what government aviation policy is in the round. This dimension of it therefore explores an area on which the Government are likely to say that we could come back next month, or perhaps the month after. Unfortunately, time and tide wait for no man and neither does legislation, because the Minister has to try to get his legislation through. Here is a clear case of where it would be helpful to have a clear view on government policy.
I am sure that the Minister will do his best on this amendment. I have no doubt that it is quite critical in the development of aviation policy. I therefore very much look forward to hearing what the Minister has to say.