Airports (Amendment) Bill [HL]

Lord Davies of Oldham Excerpts

Friday 9th November 2012 Lords Chamber

[Lord Davies of Oldham]

My Lords, like other noble Lords, I congratulate the noble Lord, Lord Empey, on his persistence with regard to this issue, the skill with which he has mobilised degrees of support for it and the work that he has done in Europe. He is absolutely right that one of the crucial constraining forces regarding the development of aviation is clearly the European powers. We all recognise that aviation has to have a European dimension as well as the issue of world-wide connections.

The debate has focused to an extent on slots. Let us be clear about slots. Whatever happens to slots in terms of their role in the market and developments in aviation—the noble Earl, Lord Caithness, emphasised how rapidly aviation develops and other noble Lords also made that point—we are dealing with a rapidly changing environment. That is why we should be greatly concerned that critical decisions about aviation are being postponed until the report of Sir Howard Davies after the next general election. We have already built in a three-year delay to the report. Certainly, after the report has been considered and then debated and then action is taken, in crucial areas of aviation policy we will have had a built-in delay of several years. That is bound to cost us dear.

It is a fact that slots do not increase airport capacity. We can re-jig the usage of slots. I was going to say re-jig the ownership of slots. The interesting thing about slots is the concept of ownership. It is clear that one aspect of ownership revolves around national governments, who can intervene on the issue of the public service obligation—an interventional power already existing with the Secretary of State. It is also the case that airports own the runways and the landing stages that accommodate passengers getting onto and off aircraft. Therefore, that airlines own the slots is an interesting concept. They certainly go in for a limited amount of trading and it is their actions, through mergers and so on, that give rise to very great anxieties when it is thought that the slots that they obtain through mergers may be allocated to other traffic.

The noble Lord, Lord Empey, rightly identified a concern with regard to Northern Ireland but, as we heard earlier this week during proceedings on the Bill, other parts of the United Kingdom are also concerned. The concern is that services will be reduced and not increased by competition—it is difficult to see what other forms of transport are going to increase competition in Northern Ireland—as the slots controlled by the airlines may be used for more financially remunerative packages. A slot that is transferred from the region to international traffic may significantly improve the financial advantage to the airline. That is why these issues are so significant.

The Minister has had a demanding week so I will not pile too much on him on a Friday afternoon but this debate has raised acute issues with regard to aviation serving the regions. However, it is difficult to talk about Northern Ireland and its aviation needs without adding that other regions have comparable anxieties about slots. Other regions also have very real concerns about economic development. I emphasise the fact that the regions were considerably distressed by the loss of the regional development agencies which gave them some hope of attracting employers and developing employment. We all realise that in a recession the regions of the United Kingdom need help.

Northern Ireland is a very specific case as regards aviation although I accept the point made by the noble Earl, Lord Caithness, that in terms of distance and the availability of alternative forms of transport the north of Scotland also comes within this frame. What, therefore, do the Government need to do? They must address this issue urgently, not least because the amount of activity that is going on in Europe at present requires the Government to take a stance on it. As the noble Lord, Lord Empey, identified, if the European Parliament and the Commission reach a position on this issue, what happens at the Council of Ministers becomes critical. The United Kingdom is an important member of the Council of Ministers so we would expect the Minister responding today to give an indication of commitment as regards the policy to be adopted.

We all recognise that aspects of the free market with regard to air travel have produced considerable benefits. We all recognise the expansion of air travel that has occurred, as identified by the noble Lord, Lord Lexden. However, we are also aware of market failure and the necessity for the Government on occasion to act intelligently and perceptively for the good of the people. That is exactly the case which the noble Lord, Lord Empey, has identified in his Bill. I hope the Minister will appreciate that in this critical area we are getting past the stage of easily postponing decisions. Time marches on and the threat to the regions from the loss of effective links with Heathrow is mounting. Therefore, the Government need to be clear about how they are going to address this issue. If they do not accept the Bill of the noble Lord, Lord Empey—I guess that he is not totally optimistic of full endorsement from the government Front Bench at this stage—they ought at least to give some clear answers to the very real issues that have been raised in this debate. The Minister will have winced at those issues at times because he recognises that even on his own Benches there are conflicting views on what needs to be done. Therefore, let us have some clarity in his response.