Bus Industry

Lord Rosser Excerpts

Thursday 18th October 2012 Lords Chamber

[Lord Rosser]

My Lords, in the light of the comments of the noble Lord, Lord Bradshaw, I am not sure whether I am required as a bus user both in London and outside London to declare an interest in this debate. I also suspect, having listened to the contribution of my noble friend Lord Snape, that there will be little support behind me, at least from those who have spoken, for what I have to say. But, nevertheless, we proceed.

This is neither the best attended debate nor a debate that has attracted a large number of speakers. However, its subject matter is of considerable importance since more people travel by bus than travel by every other form of public transport combined. I am grateful to the Library of the House for the comprehensive and helpful briefing pack it has provided. Before I go any further I would like to thank the noble Lord, Lord Bradshaw, for giving us an opportunity to discuss developments in the bus industry. One development was a Competition Commission report on the industry outside London, which found that what it described as widespread market segregation had occurred as a result of operator behaviour.

However, the bus industry also has much about which it can be pleased. The 2012 bus passenger survey by Passenger Focus, the official passenger watchdog, found that on average 85% of passengers in England, excluding London, were satisfied with their bus journeys. My noble friend Lord Snape, whose advocacy of and support for buses knows no bounds, referred to the survey.

The chairman of Passenger Focus also commented that while overall passenger satisfaction across the surveyed areas was at a consistently high level, bus passengers rated almost all other specific journey factors lower, with wide disparities in ratings of value for money not only between different areas but between different operators and services in the same area.

The Library briefing pack includes a section on the policy of the coalition Government. It points out that the coalition agreement made one mention of bus services when it stated that the Government would,

“encourage joint working between bus operators and local authorities”.

That is a little vague—no doubt because the Conservatives in opposition had proposed regulation and the introduction of quality contracts, whereas the Liberal Democrats stated in their manifesto that they would,

“give councils greater powers to regulate bus services according to community needs, meaning local people get a real say over routes and fares”.

[Lord Snape]

Will my noble friend tell the House how many quality contracts were made during the period of office of the previous Labour Government?

[Lord Rosser]

As I understand it, there were no quality contracts. The legislation was amended in 2008 because the previous legislation has made it an enormous mountain to climb to implement quality contracts. The noble Lord himself made reference to the local transport authorities that are currently seeking to pursue quality contracts in accordance with the legislation.

At Second Reading in the House of Commons of what became the Local Transport Act 2008, the Liberal Democrats said:

“The concept of having partnerships and contracts is right”.—[Official Report, Commons, 26/3/08; col. 220.]

[Lord Bradshaw]

Having twice been baited on the subject, I will say that I agree entirely with the noble Lord, Lord Snape, that quality contracts are quite unnecessary if co-operation between the local authority and the bus operator is good. That is why I started with the business about implementing Part 6 of the Traffic Management Act 2004, which was passed by his Government.

[Lord Rosser]

I note what the noble Lord said, but I am quoting from what his party said in the House of Commons—that the concept of having partnerships and contracts was right. If he is now saying that he does not agree with the statement made by his own party in opposition, of course he is welcome to do so. It is clear that on the issue of contracts, the Conservative Party view has prevailed and the Liberal Democrats have shifted their ground, even though the Minister responsible for the bus industry is a Liberal Democrat.

The bus industry, certainly outside London, is facing a difficult time. The cut in local transport funding of some 28% has led to local authorities cutting back on support for local bus services, and subsidies paid direct to bus companies have also been cut by the Government by one-fifth. In some rural areas, council-supported services make up nearly all the network, yet many of those who use buses have no other means of transport. Cutting a bus route or bus services can cut an opportunity to take up employment or to stay on in education and go to college. That hardly seems consistent with the Government’s declared policy of making it easier to gain skills and take up employment.

We have already set out the significant tranche of cuts to the Department for Transport’s budget that we would have accepted to meet our own commitment to halve the deficit in this Parliament. However, unlike this Government, we would have protected support for local bus services. While the level of financial support from government is very important, it is not the only factor that affects the availability and affordability of local bus services. The ability of local transport authorities to play a role on behalf of passengers, and potential passengers, matters as well.

In government, we legislated to enable transport authorities to, in effect, reregulate buses through the use of quality partnerships, which have led to very successful agreements in some areas, or quality contracts. But the experience of some of the ITAs that have begun to use these powers, particularly in relation to quality contracts, suggests that we did not go far enough. Efforts to introduce quality contracts by integrated transport authorities have been met with specific threats by one of our major national bus companies to close bus depots and sack drivers.

We need measures, which are not currently available, that would provide some protection to enable transport authorities that want to go down the road of quality contracts to do so without facing a long drawn-out and potentially costly process, and even then still face the prospect of being frustrated for no good reason. It should be for the transport authorities, which have a rather wider role and responsibility for the provision of transport within their areas than the bus companies, to decide whether a quality partnership or a quality contract will best deliver their goals and policy objectives on behalf of those whom they represent, and they should not be impeded in achieving either the quality partnership or a quality contract by actions designed to frustrate by either bus companies or indeed government—which I will come on to.

As the recent House of Commons Transport Select Committee report said, in a fairly lengthy but important quote:

“The Quality Contract option is a legitimate one for a local authority to choose. It must also be seen as credible in order to enable the local authorities to apply pressure in cases where competition or partnerships are not working satisfactorily. Local bus operators should not seek to frustrate moves towards a Quality Contract. That no local authority has implemented a Quality Contract more than a decade after the provisions were introduced suggests that there are significant hurdles to overcome, particularly for the first local authority to go down this route. The legislation itself, as amended by the Local Transport Act 2008, seems satisfactory but the process is still lengthy and risky”.

The Select Committee went on to say:

“We recommend that the Government makes the Better Bus Areas funding available, in principle, to support Quality Contracts as well as partnership schemes”.

However, that is precisely what the Government are not doing. The Minister responsible for buses has decided to exclude transport authorities that pursue quality contracts from accessing the Government’s better bus areas fund, to which the Government are implementing the commitment to devolve bus subsidies. The various strands of bus funding should be brought together in a single pot, which could then come under the democratic control of transport authorities.

However, the Government’s decision on access to the better bus areas fund is obviously designed to make it financially difficult, if not impossible, for local transport authorities that wish to go down the road of quality contracts to do so. How can the Government say that they are in favour of devolving powers and yet be prepared to penalise those authorities that decide they wish to pursue tendering, which they are entitled to do under the law? Tendering as an option is not such a radical idea. It is commonplace in much of Europe as well as in London, where a Conservative mayor has not shown any enthusiasm for dismantling the system. In fact, some of the operators opposed to quality contracts in this country are subsidiaries of wider groups that regularly bid for and secure contracts in Europe.

[Lord Snape]

Can my noble friend tell your Lordships’ House whether or not our party is now in favour of the London experience being spread countrywide, and has he cleared such a commitment with the shadow Chancellor?

[Lord Rosser]

I did not say that we are in favour of it being spread countrywide, full stop. What I have said is that it should be up to the transport authorities to decide whether to go down the road of quality partnerships or quality contracts, as they are entitled to under current legislation.

We need to protect the funding for bus services. We also need stronger transport authorities accountable for decisions over fares and services to the communities they serve, and with the confidence to decide freely what kind of relationship they want with bus operators. Unfortunately, the Government have decided to go in exactly the opposite direction.

Railways: High Speed 2

Lord Rosser Excerpts

Wednesday 11th July 2012 Lords Chamber

[Lord Rosser]

My Lords, I thank the noble Viscount, Lord Astor, for securing this debate. Our position is that we strongly support the transformation of our rail network to provide greater capacity and reduce journey times. This will require a combination of both new high-speed lines alongside upgrading the existing network through a programme of electrification and a new generation of high-speed intercity trains. We delivered Britain’s first new high-speed rail line, High Speed 1, and before the last election we set out plans for a second high-speed line, HS2, connecting London to Birmingham, Manchester, Sheffield and Leeds. The Government have backed this project and it should continue to be taken forward on a cross-party basis.

We have some concerns over the way the Government are planning to deliver the new high-speed line. We support creating a major transport hub near Heathrow which would improve connections between our largest airport, Crossrail and the Great Western main line. Since that would mean some change in alignment, it might enable better protection of the Chilterns. If the Government are determined to reject this sensible alternative, we will accept their decision but will expect credible alternatives to be brought forward to address the issue.

We disagree with the Government’s decision to legislate only for the first phase of the high-speed rail line in this Parliament. By splitting the route between two pieces of legislation, the Government are risking national support for the scheme and raising unnecessary concerns about the cross-party commitment that exists to complete the entire Y-shaped route. We also believe that high-speed rail should be a service that is affordable for the population as a whole and not just certain sections of the community, as envisaged by the previous Secretary of State in evidence to the Commons Transport Select Committee in September last year.

All noble Lords who have spoken will want to hear from the Minister whether the Government’s position on High Speed 2 remains as set out in the Written Statement by the Secretary of State for Transport on 10 January 2012. I, too, would like the Minister to answer that question. I would also like the Minister to say whether any subsequent developments have significantly changed the figures to the extent of appreciably weakening the case contained in Command Paper 8247 on high-speed rail, presented to Parliament in January 2012, the Atkins paper of January 2012—the High Speed Rail Strategic Alternatives Study—and the two January 2012 HS2 Ltd/Department for Transport papers on the economic case for HS2.

Will the Minister also say, assuming that the Government’s position on HS2 has not changed since the Written Statement of January 2012, whether the Government’s main—but certainly not only—argument for HS2 is the saving in time for those travelling by rail between London, Birmingham, Manchester and Leeds, or whether it is the need to address the projected serious capacity problems arising from continuing significant projected growth in passenger demand on the west coast and east coast main lines between London and Birmingham, London and Manchester and London and Leeds as well as growth in freight traffic?

Civil Aviation Bill

Lord Rosser Excerpts

Monday 9th July 2012 Grand Committee

Moved by

[Lord Rosser]

64: Clause 96, page 59, line 32, leave out paragraph (b)

[Lord Rosser]

My Lords, the purpose of these amendments is to stop the Bill from apparently removing the Treasury’s oversight on non-executive pay at the Civil Aviation Authority, which was provided for in the 1982 Act that established the CAA. Under the Bill’s proposals, decisions on pay, allowances, pensions or gratuities will be determined solely by the Secretary of State for Transport.

Following recent failures to take action over excessive pay until forced into it by political and public pressure, as with RBS and Network Rail where the Secretary of State for Transport initially denied that she could do anything about the level of bonus payments to top executives, there should not be any weakening of oversight on remuneration payments. At this time of increased and justified public concern about levels of pay and bonuses, it is hardly appropriate for the Government to be seeking to remove a layer of checks and balances on the setting of CAA non-executive board members’ pay.

The CAA non-executive members were paid varying amounts up to some £77,000 in 2010-11. Non-executive board members are not there simply to make up the numbers or to add a veneer of outside independence and challenge. They are there as critical friends to challenge and question the senior executives on both the policies that they are pursuing and the policies that they are not, including accounting and financial policies, and to ensure that appropriate corporate governance arrangements are not only in place but are being properly implemented and applied.

Under the Bill, the CAA non-executive members will also determine the terms and conditions on which the chief executive is to be employed and who should be appointed. Other executive members are to be appointed by the chief executive with the approval of the chair and at least one other non-executive member who also will have to approve the terms and conditions under which other executives are employed. The role and importance of the CAA non-executive members is further enhanced not just by the more influential role that the CAA will have but also by the fact that the Secretary of State and the chief executive must exercise their powers to secure that, as far as practicable, the number of non-executive members exceeds the number of executive members.

So at a time when there is increasing concern about remuneration packages and bonuses; at a time when CAA non-executives will be involved in the major senior executive appointments and their terms and conditions; at the same time as the role of the Civil Aviation Authority is being increased; and at the same time as the importance of non-executives is being increased by there being a requirement in this Bill for the number of non-executives to exceed the number of executive members, the Government decide that this is the appropriate time to remove the oversight that the Treasury has on non-executive pay at the CAA. The Treasury can provide a degree of impartiality over decisions on the remuneration of Department for Transport appointees, as well as having knowledge of what remuneration levels are for non-executive members appointed through other departments of state. The Government’s logic does not add up. I beg to move.

[Earl Attlee]

My Lords, I am grateful for the explanation given by the noble Lord, Lord Rosser, and I hope that I can clarify the Government’s position on these probing amendments. In the current political environment and with the public interest in these matters, I can quite understand why the noble Lord has tabled them.

There are several reasons why I cannot support all these amendments, to which I will come shortly. By way of background, the changes introduced by the Bill that these amendments seek to overturn complete a series of governance reforms recommended by Sir Joseph Pilling following his 2008 strategic review of the Civil Aviation Authority. Sir Joseph’s conclusion was that the involvement of two government departments in remuneration decisions was unnecessary. He said:

“In evidence to the review the Treasury explained that the CAA was the only regulator it looked at in this way … The statutory requirement for the Treasury to approve the Civil Aviation’s members’ remuneration and pensions is an anomaly. I recommend that the Department for Transport seek to amend the legislation so that the responsibility lies solely with the Secretary of State”.

He also asked the Department for Transport to consider the approach of some other UK regulatory bodies where the board appoints executive directors without ministerial involvement. The previous Government accepted those recommendations and consulted on the proposals reflected in the Bill. The Government agree with Sir Joseph’s conclusions that the oversight of the Treasury is an anomaly that adds no value. The Committee should note that there is no equivalent requirement for any comparable regulatory body, so Clause 96 implements an important aspect of the Pilling report. It would remove Treasury involvement in approving the remuneration of non-executive members. Removing Treasury oversight will also remove unnecessary government duplication; there is no need for two government departments to be concerned with CAA board remuneration. It will also reduce unnecessary delays in the appointment of non-executive members of the CAA.

There is nothing so special and different about the CAA board appointments that they alone of all regulatory appointments require the approval of two government departments. The Secretary of State will continue to be responsible for appointing non-executive directors and determining their remuneration. They are part-time posts that currently pay under £25,000 with some small additions, where applicable, for extra work. I note that the noble Lord, Lord Rosser, suggested that some were paid £75,000. They are not in a CAA pension or bonus scheme. It is therefore quite unnecessary for the Treasury to undertake the administrative burden of checking the decisions of the Secretary of State. I hope that that provides the Committee with the reassurance required and that the noble Lord will consider withdrawing his amendment.

[Lord Rosser]

Obviously, it is my intention to withdraw the amendment, but before doing so perhaps I may ask the noble Earl whether he said that the posts would receive less than £25,000. Is he saying that that was the case in the financial year 2010-11 for which we appear to have the figures?

[Earl Attlee]

The non-executive directors are currently paid between £22,000 and £25,000 and are not eligible for pensions or bonuses, although they can receive extra payments for extra days of work. I hope that that helps the noble Lord.

[Lord Rosser]

I note with interest the Minister’s response. Either the figures that I have are incorrect or an awful lot of extra work is undertaken, but obviously I can look at that. The key part of the Minister’s argument is that no other regulatory bodies have Treasury and appropriate department involvement. The Minister has been clear on that. I shall certainly want to reflect on his response, but I beg leave to withdraw the amendment.

Amendment 64 withdrawn.

--- Later in debate ---

Moved by

[Lord Rosser]

67: Before Clause 100, insert the following new Clause—
“Accounts and audit
(1) Section 15 of the Civil Aviation Act 1982 (accounts and audit) is amended as follows—
(a) in subsection (1), for paragraph (c) substitute—“(c) to send copies of the statement of accounts to the Secretary of State and the Comptroller and Auditor General before the end of the November following the accounting year to which the statement relates.”;(b) in subsection (2), for paragraph (a) substitute—“(a) the National Audit Office shall examine, certify and report on each statement of accounts received under subsection (1) and shall lay copies of the statement of accounts and of its report thereon before each House of Parliament.”(2) In the National Audit Act 1983, Schedule 4 (Nationalised Industries and Other Public Authorities) Part 1, leave out “Civil Aviation Authority.””

[Lord Rosser]

The amendments in this group provide, first, for a new clause that would give the National Audit Office oversight of the Civil Aviation Authority’s accounts. It would also place on the Civil Aviation Authority a general duty of efficiency in the use of its financial resources. It is not clear why the Government have not already included those provisions in the Bill. There are significant changes in the role of the Civil Aviation Authority under the Bill in relation to aviation security functions transferred from the Department for Transport and the economic regulation of airports. The Civil Aviation Authority is likely to become a more influential and important body as a result.

Other regulatory bodies, including economic regulators which are also industry funded, are subject to National Audit Office oversight. They include Ofgem, Ofwat and Ofcom. The Office of Rail Regulation is also subject to National Audit Office oversight, and the ORR is likewise funded from within the industry. As we know, the Civil Aviation Authority is funded from the aviation industry and also receives a limited amount of money from the taxpayer. It is not, however, subject to National Audit Office oversight, although it is generally recognised that the Comptroller and Auditor-General and his staff at the National Audit Office do a highly effective job.

The activities of the regulators to which I have just referred and which are subject to NAO oversight do not involve significant public funds, but they lead to costs being incurred by the providers of essential or strategic services which are likely to be passed to consumers, which justifies NAO involvement. That is particularly the case where the need for active economic regulation has arisen from the process of privatisation, and it is therefore only right that there should likewise be National Audit Office oversight of the Civil Aviation Authority’s accounts, as provided for in the amendment. The House of Commons Transport Select Committee in its report also called on the Government to explain why the Civil Aviation Authority is apparently unique among industry regulators in being outside the remit of the National Audit Office.

The second amendment gives the Civil Aviation Authority a general duty of efficiency in the use of its financial resources. A number of those giving evidence to the House of Commons Transport Select Committee suggested that the CAA did not always operate in the most efficient way possible. For example, in its written evidence, British Airways stated that no measures to encourage efficiency had been included in the Bill and that it considered that the Civil Aviation Authority had scope to make significant improvements in efficiency in certain areas. It argued that the CAA should have a duty to operate efficiently.

In order to keep costs for airlines and passengers, as well as the taxpayer, as low as possible, it is essential that the CAA adopts efficient ways of working and modern technology where appropriate, as higher costs for airlines arising from CAA charges and any inefficient use of its financial resources have the potential to damage major UK airports’ competitiveness with alternative competing hubs. The Transport Select Committee, having taken evidence, recommended that an explicit efficiency duty for the Civil Aviation Authority should be inserted in the Bill. It is clear that it was unimpressed with arguments that other parts in the Bill already provided that explicit efficiency duty for the CAA.

I hope that the Minister will be able to give a sympathetic and helpful response to the amendments and I beg to move Amendment 67.

[Lord Soley]

I share the concern expressed by my noble friend Lord Rosser about leaving the CAA out of National Audit Office oversight. I have never understood the argument for that. It is very unusual, if not unique, for such an organisation to be left outside the remit of the NAO, and the case for its inclusion is strong. At the very least, I would like the Government to explain why; I do not understand it. The argument about efficiency follows from that, but the one that worries me most is raised by Amendment 67, which I support. I have not yet heard any argument why the CAA should be outside the remit of the NAO, because almost any other body of this type would be included. I should like an explanation for that.

--- Later in debate ---

[Earl Attlee]

My Lords, I am afraid that I will have to write to the noble Lord on the CAA’s budget. As ever, I will give Members of the Committee a comprehensive answer to any of their more technical questions.

[Lord Rosser]

In writing that letter, can the Minister also give the relevant comparable figures for the other regulatory bodies to which we have referred—Ofgem, Ofwat, Ofcom and the ORR—and which are also funded in part by their industries? If the Minister’s argument on this issue is that the figure for the Civil Aviation Authority is particularly low in either percentage or actual terms when compared with other regulators, which are also partly funded from within their own industries, perhaps in sending that letter he could provide the comparable figures so that we can have a look at them.

I would comment only that while the Minister says that it is up to us to show the case for why a current arrangement should continue, there is to be a changed Civil Aviation Authority under the Bill. We are not talking about that authority as it is now but about one with enhanced powers and influence. I would have thought that the onus lay with the Minister to show us why the arrangements for the CAA should be different from those for other regulators, rather than the context in which he put it: of seeking to say that we have to make the case. It is the Minister who has failed to make the case, frankly, but I will leave it until we receive the letter from him with the information that he has said he will provide.

I am still not clear which clauses the Minister is saying provide the general duty of efficiency. I see a reference in Clause 1(3), to which I think the Minister referred, to the CAA having,

“regard to … the need to promote economy and efficiency on the part of each holder of a licence”,

for example, but that does not relate to the CAA’s efficiency. I can find references, which I think the Minister used, to activities being,

“transparent, accountable, proportionate and consistent”,

but those do not necessarily refer to being efficient or efficiency so I do not know what the noble Earl’s argument is. Which clauses is he saying cover the general duty of efficiency? My understanding is that this is not some unique clause that we are proposing to put in, as one can find examples of it applying elsewhere. Once again, why is the Minister saying that it should not apply to the CAA when, from what I have heard from him and from my understanding of the Bill, I cannot see such a clear reference as he can to a general duty of efficiency in any other clauses at present? I wonder if he can assist with that.

[Earl Attlee]

On Amendment 68, the noble Lord’s points are well made. I said that I will continue to reflect on the matter and consider what further reassurances can be given at Report. My reason for saying that is that the noble Lord has put his point very well.

[Lord Rosser]

I am grateful to the Minister. I heard him say that the first time round, but I am grateful to him for having reconfirmed that he is looking at this matter. I appreciate that he has not given any commitments. While I would not want to suggest that when the noble Earl says he is looking at a matter he is not doing it seriously, if I say that he is looking at it seriously I hope he does not take that in the wrong spirit and infer that I think he sometimes does not. However, in view of what the noble Earl has said, I beg leave to withdraw the amendment.

Amendment 67 withdrawn.

Civil Aviation Bill

Lord Rosser Excerpts

Wednesday 4th July 2012 Grand Committee

Moved by

[Lord Rosser]

52: Clause 82, page 51, line 10, at end insert—
“(b) the individual employed in the civil service of the Crown, and(c) representatives of individuals employed as defined in paragraph (b)”

[Lord Rosser]

My Lords, these are probing amendments to explore how the Government intend to ensure that there is no significant or damaging loss of staff with experience of relevant security issues when aviation security regulation functions are transferred from the Department for Transport to the Civil Aviation Authority.

As to the first amendment, Clause 82 refers only to the Secretary of State consulting the Civil Aviation Authority before making a transfer scheme to the CAA. Who else would the Secretary of State consult, particularly on the impact of such a transfer on individual employees who are directly affected or potentially directly affected? The second amendment requires the Secretary of State to review the impact of such transfers on the security functions of the CAA before making such a scheme, given that there does not appear to be a clear provision in the Bill, and proper assessment of the impact of such a transfer scheme on security and security functions must surely be a key responsibility of the Secretary of State before deciding whether to proceed.

It appears from the impact assessments for the legislation that the primary purpose of this switch of aviation security regulation functions from the Department for Transport to the CAA has been driven by financial considerations and the spending review, which may not be the most appropriate driving force for change when dealing with an issue of this nature—particularly when a highly successful security regime has been in operation since the tragic Lockerbie bombing.

The Transport Select Committee in the other place expressed concern that the decision to transfer aviation security regulation functions from the Department for Transport to the Civil Aviation Authority was included in the draft Bill at a late stage and was not subject to consultation. The committee also said that it was important that the CAA had sufficient security expertise to undertake its new role and that the Department for Transport and the CAA should investigate employment arrangements, possibly including secondments rather than transfers, precisely to avoid losing experience staff and expertise in the transfer of posts from the department to the CAA.

In Committee in the other place, the Transport Minister said that some 85 staff might be seconded rather than transferred, and no doubt the noble Earl will give an update on the present arrangements and intentions, the number of staff who will be transferred and seconded, and why being seconded would not be a better option for the staff as a whole. It would also be helpful if the noble Earl could say what steps are being taken to encourage staff affected to stay on in order to ensure that this transfer will not lead to loss of expertise in such a crucial part of our security provision and protection. I beg to move.

[Earl Attlee]

My Lords, let me begin with Amendment 52. The Department for Transport has already begun to engage with staff and their trade union representatives on the proposed transfer of staff from the DfT to the CAA. The department’s human resources unit has formally engaged with the Public and Commercial Services trade union and the Prospect trade union on matters relating to the proposed transfer of posts and post holders to the CAA.

There have been briefing events for staff, including a joint event with the CAA on 31 January, and staff are kept informed with regular written and oral updates. We will engage with staff and their trade union representatives as we develop the transfer arrangements over the coming months until the planned transfer in spring 2014.

Engagement with staff is vital, not least because we want to ensure that as many staff as possible transfer to the CAA, taking their skills and experience with them. A particular concern of the noble Lord, Lord Rosser, is that we do not lose this valuable expertise. We have no intention of doing anything that would cause unnecessary losses. We will work to provide as much visibility and clarity as possible about the transfer, but we cannot answer all the questions yet. The Government believe that there is no need to amend the Bill to achieve something that is already happening, so I hope that the noble Lord will withdraw Amendment 52 in due course.

--- Later in debate ---

[Earl Attlee]

It is indeed, my Lords. If we thought that we would lose a large number—or a majority—of the experienced staff due to this change, we would not do it. However, I see no reason why aviation security specialists who currently work for the DfT would not be equally happy working for the CAA. If they were being invited to work in the private sector, that could be much more of an issue. However, they will be transferring from one respected government department to another respected organisation.

[Lord Rosser]

I thank the Minister for his reply. I also thank my noble friends Lord Soley and Lord Clinton-Davis for their helpful contributions. The Minister said, I believe, that the driving force on the financial side was the principle that the user pays. Surely when we talk about aviation security regulation the principle that the user pays should not take precedence over the principle that we want the most effective security regulation arrangements.

I have not yet heard the Minister or anyone else argue that the current arrangements, which we have had for a number of years, are not highly successful and effective, as they are recognised to be. Frankly, if the real reason for this change is financial—namely, that the user pays—and is not based on improving the present arrangements for aviation security regulation, I suggest that the Government have got wrong the driving force for the change. Certainly I have not heard from the Minister any criticism of the current arrangements, any indication of how they have failed or any indication of how they will be made more successful and more efficient by the proposed change.

The Minister said that we should not go into detail about numbers. However, as I said, in Committee in the other place the Transport Minister referred to numbers and said that 80 staff might be seconded rather than transferred. I made reference to the view that was expressed that it might be better if staff were seconded rather than transferred.

[Lord Clinton-Davis]

The Minister did not say how often this provision will be regarded. When I was Civil Aviation Minister, it was inevitably the case that this would be reviewed regularly. I hope that this provision will continue to apply.

[Lord Rosser]

I thank my noble friend for that point. Perhaps the Minister will comment on it in a moment.

I asked whether the Minister could give an update on how many staff will be transferred and how many will be seconded and say why secondment would not be a better option for staff generally. I am not asking him to go into the details of discussions that are taking place, but he might be able to respond to those particular points. Is the Minister willing to do so before I withdraw the amendments? I intend to withdraw them—as I said, they are probing amendments.

[Earl Attlee]

The Government believe that industry will benefit from the efficiencies that could be gained from having aviation security and safety regulation in one place. The CAA has potentially valuable experience of safety management systems that are designed to manage risks as effectively as possible. We think that this experience, coupled with the skills and experience of the DfT staff, could bring real benefit to how we regulate aviation security in the UK. That move would also mean that the principle that the user pays is applied to aviation security in the same way as it is applied to aviation safety.

Charging the industry for the regulation of aviation security will align it with the vast majority of other forms of regulation, including the CAA’s regulation of aviation safety. The aviation industry already meets the costs of providing security at close to £1 billion per annum, so the cost of regulation at £4.8 million per annum is a small addition that could be neutralised by efficiency savings arising from the reform package.

The noble Lord asked me about secondments, which the PCS trade union also raised in its evidence to the Public Bill Committee in the House of Commons. We can look at how secondments might be used as we develop our plans for the transfer. However, we consider that seconding DfT staff to the CAA instead of transferring them is unlikely to help to ensure that experienced staff remain with the CAA when the secondments end.

[Earl Attlee]

My Lords, I am sure that when they make a change, all Governments consider whether they have done the right thing. I am not sure about a formal review, but all Ministers look back to make sure that the changes that they have implemented are working.

[Lord Rosser]

I thank the Minister for the further information that he has given. I am sure that he will not be entirely surprised when I say that I still have the impression that this one is financially driven rather than driven by any real belief that the aviation security regulation function will somehow be carried out more effectively through the arrangements that the Government are proposing than they are at present. However, I have expressed my views on this and the Minister has replied on behalf of the Government. I also said that these were probing amendments, and I beg leave to withdraw the amendment.

Amendment 52 withdrawn.

--- Later in debate ---

Moved by

[Lord Rosser]

56: Clause 83, page 51, line 22, at end insert—
“( ) the full cost of travel for users of air transport services, including all relevant surcharges such users would be expected to pay.”

[Lord Rosser]

Clause 83(1) requires the Civil Aviation Authority to publish,

“such information and advice as it considers appropriate for the purpose of assisting users of air transport services to compare—

(a) air transport services provided to or from a civil airport;

(b) services and facilities provided at a civil airport in the United Kingdom;

(c) services and facilities provided elsewhere in the United Kingdom and used, or likely to be used, in connection with the use of air transport services provided to or from a civil airport”.

This information is to be provided for the benefit of users of air transport services, no doubt in the light of the Civil Aviation Authority’s primary and overriding duty under Clause 1 to carry out its functions,

“in a manner which it considers will further the interests of users of air transport services”,

including in relation to the cost of current airport operation services.

Taking into account that reference to cost, the amendment adds an additional requirement on the Civil Aviation Authority to publish information and advice to assist users of air transport services to compare the full cost of travel for users of air transport services, including all relevant surcharges such users would be expected to pay. Indeed, one might think it surprising that the specific duty to make such information relating to cost available to users is not already in the Bill and is apparently left entirely to the discretion of the CAA, since the Bill says that the CAA should publish such information and advice as it considers appropriate.

The issue of charges and surcharges when travelling by air is increasingly important to those who are travelling, not least because some of the extra charges or potential extra charges are not always as clear as they might be. What might therefore seem to be a relatively cheap budget airline flight may not necessarily prove to be the case as the actual cost of travel can prove much higher than the basic fare quoted by the airline operator—indeed, in certain circumstances, more than if travelling with a mainstream operator.

Reference was made at Second Reading to a survey published in May in a national newspaper that showed that one well known budget airline’s high-season rate for a 20-kilogramme bag to go in the hold was £70 return, and if you did not book online but turned up at the airport with your bag the fee was £130 one way. The survey of budget airlines’ add-on charges showed that it could cost as much as £110 to change the name on a ticket and £120 because your bag weighed 3 kilogrammes over the limit. It also showed that add-on charges apply to a multitude of things covering bags, seat reservations, credit card fees, name-change fees, flight-change fees and fees for taking on special items such as golf clubs. Indeed, when the survey tested costs for a one-week return flight to Malaga for one person taking a 20-kilogramme bag and paying by credit card, it found add-on costs ranging from just under £35 to £82, depending on the low-cost airline operator.

The credit card surcharges to which I have made reference are a significant money-spinner for the airlines. The Office of Fair Trading has said that UK consumers spent £300 million on payment surcharges to airlines in 2010. Even though there is an attempt to clamp down on excessive card fees from the end of this year, there is evidence that airlines may seek to get around that by referring to the charge in future as an administration fee related to costs associated with the booking system.

The purpose of the amendment is not to pass judgment on the apparent proliferation of add-on charges but simply to say that such information on the level of charges and the many different things that they cover, which many might have thought would have been included in the basic fare or not charged for at all, should be made clear so that those using air transport services are able to make accurate comparisons of the full cost of travel, or potential full cost of travel, and not get caught out by a charge that they were not anticipating and of which they were unaware. Indeed, determining the add-on costs is not a straightforward or easy business for those travelling or thinking of doing so, given that some airlines charge flat-rate fees while others levy charges based on the cost of the flight.

The figures that I have quoted reveal a wide disparity in the level and incidence of such charges, and one would have thought it highly appropriate for the Civil Aviation Authority to have a role in ensuring that such information was readily available in an impartial and objective form as part of its duty under Clause 83 to provide information for the benefit of users of air transport services. That is what the amendment seeks to achieve. I beg to move.

[Lord Soley]

My Lords, I am delighted to support my noble friend without any hesitation. Let us not beat about the bush: one of the worst offenders in this area is Ryanair which, if it continues for much longer as it has been, will have a big photograph of its founder on the way in to the airport and you will have to pay to bow to it. He is adding costs and charges that are totally unreasonable. He is by far the worst offender but there are others too. The time is long overdue when all the costs of a flight should be properly advertised. It is very important. We are expecting people at the moment to book tickets when they do not really know what the full cost is and, as my noble friend has indicated, when they get to the airport they suddenly discover that the cost is infinitely more than they thought it would be, because of extra bags and taking special items on board. A short while ago we had a dreadful incident with regard to wheelchairs. All this is utterly appalling and utterly wrong.

I do not think we should mess about on these issues. All airlines should be made to set out all the charges that are imposed on customers so that they know in advance what they are going to have to pay for their tickets. My noble friend’s amendment is wholly good. If the Minister cannot accept it as it is, I hope that he can at least ensure that it goes into the Bill in some form. These practices need to be stopped.

--- Later in debate ---

[Earl Attlee]

My Lords, I am sure that many noble Lords share the noble Lord’s view of that airline but, on the issue of publication, it is up to the CAA to determine what to publish, taking into consideration the results of the consultation.

On the second issue of payment surcharges, like the noble Lord, Lord Rosser, I share consumers’ concerns about the high level of payment surcharges applied by some companies and that often people are not aware of the level of these charges until almost at the end of the booking process. That makes it difficult to compare prices and shop around for a good deal. It is not right that a business should try to hide the true cost of its services by implying that its prices are made up of elements beyond its control when they are not.

Your Lordships will be aware that consumers are already protected against misleading pricing under the Consumer Protection from Unfair Trading Regulations. Additionally, on 23 December 2011 the Government announced our intention to consult on implementing the payment surcharges provision of the consumer rights directive ahead of the June 2014 deadline. We intend to issue a consultation in the summer to seek views on the timing of implementation and other details on how the provision should be applied. Responses to the consultation will inform our decision on timing and our guidance to businesses.

I hope that it is clear from what I have said that the intent of the amendment is already implicit in the primary duty and that effective mechanisms are already in place to secure the result intended. Given that, I hope that at the appropriate time the noble Lord will feel able to withdraw the amendment.

[Lord Rosser]

I thank the Minister for his reply, which I thought was going to be even more helpful than it proved to be, although I do not question his desire for transparency to be brought into charges and surcharges levied on air transport users.

I thought I heard the Minister say—when or shortly after he referred to the article under EU regulations—that the Civil Aviation Authority was of the view that airlines were complying with the regulation. If I understood correctly what the Minister said, and if the CAA is basically happy with the current situation, my only comment is that Clause 83(1), with its requirement for the CAA to publish or arrange for publication of information to assist users of air transport services, will not have any great force if the CAA considers that the situation is already satisfactory in relation to making the charges and surcharges known.

However, the extremely helpful contributions of my noble friend Lord Soley and the noble Lords, Lord Rotherwick and Lord Bradshaw, indicated that the current situation is not satisfactory and that charges are not easily and readily available to users of air transport services. For that reason, I feel somewhat concerned by the nature of the Minister’s reply. I get the feeling that the Civil Aviation Authority thinks that, in essence, the situation at the current time is satisfactory. Clearly, from the comments made in this debate, and from reports in the newspapers of individuals who have fallen foul of the surcharges, it is not. If the Government do not like the wording of the amendment, perhaps they will go away and produce wording that they think is appropriate. It is a test of how determined they are to be on the side of users of air transport services.

The Minister may argue that the issues are covered by this or that legislation or by something in the Bill, but Clause 83(1) makes no reference to charges or surcharges. Clearly there is still a problem here. This is an opportunity for the Government to show their determination to be on the side of the users of air transport services, who have suffered from these additional charges. The Government can show that by making it even more explicit than they believe it to be in the Bill that it is a duty and a responsibility of the Civil Aviation Authority to make sure that the full cost of travel for users of air transport services, including all relevant surcharges that such users will be expected to pay, is available through CAA channels or directives. The CAA would be regarded as an impartial and objective body that would give reliable information rather than information that might be open to more than one interpretation.

I beg the Minister to think again about this. The issue is about making information clear and stopping people finding additional charges that they did not expect. It ought to be possible—I argue that it is necessary—to make sure that the Civil Aviation Authority, with its powers under the Bill, should provide this service for air transport users. The Government should make it very clear in the Bill that that is part of the CAA’s role and that this is the kind of information that it should provide in a clear, objective and impartial form that is easily available to those who want to use air transport services. This is about the importance that the Government attach to highlighting this problem and dealing with it.

[Earl Attlee]

My Lords, I reiterate to the Committee that the Government accept that there is a problem. We are determined to deal with it but we need to do so in the right way. The noble Lord asked me about what I said about Article 23. Perhaps it is worth carefully going over it because it was carefully drafted. The CAA has been working with airlines to ensure compliance with this requirement and considers that the airlines that it worked with are now compliant with Article 23. That implies that the airlines that it did not work with are not compliant.

--- Later in debate ---

[Lord Rosser]

I thank the Minister for his further comments. It is fair to say that he did not address my point that Clause 83(1), which covers the CAA publishing information, does not actually lay a specific requirement on the CAA to cover information on the costs of travel, including all relevant surcharges; it says that the CAA must publish what “it considers appropriate”. Surely it would be much happier for the Bill to make it clearer that the CAA is expected to publish this information on charges and surcharges, for the benefit of users of air transport services. I am genuinely sorry that the Minister has not been prepared to move on this. Bearing in mind that he has accepted that there is a problem, it is not satisfactory to seek to argue that it is covered elsewhere, when the opportunity is here in the Bill to ensure that there is a clear responsibility for the CAA to act for the benefit of air transport users in respect of charges and surcharges. It would not cost the Government anything to put it in, but it would make it very clear to everybody that this was a role for the CAA. Frankly, in the light of what the Minister has said—he accepts that it is a problem, and he seeks to argue that it is covered in other parts of the Bill or in other regulations—why does he resist putting it in the Bill, clearly and emphatically, in the way that I suggest?

Despite the further representations that my noble friend Lord Soley and I have made, it is clear that the Minister is not going to budge on this one even though, as I say, it is difficult to understand what the difficulty is. If that is the Minister’s stance, there is little else that I can do at this stage but withdraw my amendment, but obviously we shall have to consider whether we wish to pursue this matter further on Report. I beg leave to withdraw the amendment.

Amendment 56 withdrawn.

--- Later in debate ---

Moved by

[Lord Rosser]

59: After Clause 83, insert the following new Clause—
“Access for disabled and reduced mobility air passengers
The Secretary of State and the CAA will produce an annual report on disabled and reduced mobility air transport passenger experiences of airport operation services and air transport services which must include evidence on the extent to which airport operations and air transport services are compliant with relevant legislation, regulations and codes of practice for the time being in force.”

[Lord Rosser]

My Lords, this amendment would insert into the Bill a new clause on access for disabled and reduced mobility air passengers. It would require the Secretary of State and the Civil Aviation Authority to produce an annual report,

“which must include evidence on the extent to which airport operations and air transport services are compliant with relevant legislation, regulations and codes of practice”,

as well as information on the experiences of disabled and reduced mobility passengers of airport operation services and air transport services. Passengers with disabilities or reduced mobility need to be given appropriate assistance at airports, especially when passing through security. The Department for Transport’s decision to abolish the Disabled Persons Transport Advisory Committee, which gave advice on the experiences of disabled people that enabled transport provision to be improved, has meant the loss of a valuable source of advice to airports and policy-makers.

The Civil Aviation Authority has a primary duty to carry out its functions in a manner that furthers the interests of users of air transport services. However, Clause 1(5) states that:

“If, in a particular case, the CAA considers that there is a conflict—

(a) between the interests of different classes of user of air transport services, or

(b) between the interests of users of air transport services in different matters mentioned in subsection (1)”—

—that is, the,

“range, availability, continuity, cost and quality of airport operation services”—

the Civil Aviation Authority’s duty under that subsection in those circumstances is,

“to carry out the functions in a manner which it considers will further such of those interests as it thinks best”.

--- Later in debate ---

[Earl Attlee]

My Lords, if the noble Lord will let me finish my speech, he may gain a better understanding. Also, I will send him more details by post.

Noble Lords will know that the CAA announced in April that the chair of the new panel would be Keith Richards. Mr Richards has considerable experience of disabled air passenger issues, having been chair of the aviation working group at the Disabled Persons Transport Advisory Committee for many years, as well as a former head of consumer affairs at the Association of British Travel Agents. The CAA and the new panel chair will need time to develop a relationship, but, it would not be unreasonable to suppose that the experience of disabled passengers at airports and on planes will be of considerable interest to the new chair. I suggest that it would be better to allow the new CAA consumer panel to have the space to develop how it will go about its work, and how best to support and inform passengers, than to impose an obligation on it in the way suggested by the noble Lord’s amendment. In view of this, I hope that the noble Lord will withdraw his amendment in due course.

[Lord Rosser]

I thank the Minister for his response, and I thank my noble friend Lord Clinton-Davis for his very helpful contribution. I do not see the amendment, as the Minister implied with his last comment that he sees it, as imposing a great burden in future on the CAA. If part of the problem is that the Secretary of State is also involved and the Minister does not think that appropriate, that issue could be addressed in a further amendment at a later stage.

The Minister did not address the enhanced, more important and more influential role that the CAA will surely have under the Bill, which gives it additional responsibilities and lays on it a general duty to carry out its functions in a way that will further the interests of users of air transport services. Simply to say that it already produces a report perhaps does not do justice to the enhanced role and greater importance and influence of the CAA that appears to be provided for in this legislation.

--- Later in debate ---

[Lord Rosser]

I thank the noble Lord for that contribution. If the Minister had stood up and said that—unless he is going to say that such a passage is already in the annual report from the CAA, in which case I suspect that it would need to be expanded in view of its enhanced role—I might well have felt that it was a move in the direction of the amendment. My concern is not so much about whether the report is a separate document as about whether the issue is covered and addressed by the CAA. If it can address that properly and fully in an existing annual report, I am sure that that would go a long way towards meeting the point that I have made in the amendment.

[Earl Attlee]

My Lords, the noble Lord asked me about the difficult point of the CAA balancing the needs of different users. As I have already said, they are in the same group—that is, users of air transport services. However, there is nothing to prevent the CAA focusing on different groups of users in exercising its information duties. I will write to the noble Lord in greater and more carefully considered detail on these points. I can see that he is very interested in exactly how the legislation works. The matter is far too technical for me to be able to respond orally, and I am sure that it is much better handled in writing.

[Lord Rosser]

As I said, my main concern is not that there is a separate document but that the issue is covered. Can the Minister give assurances that in annual reports from the CAA—he has expressed his concern about the Secretary of State also being involved—the issues that we have been discussing can be addressed under the new powers that the CAA will have under the Bill?

[Earl Attlee]

My Lords, I think it is much wiser for me to confine all that to my letter to the noble Lord.

[Lord Rosser]

I am happy to accept that, if the Minister will address the matter in his response. In view of that, I beg leave to withdraw the amendment.

Amendment 59 withdrawn.

Civil Aviation Bill

Lord Rosser Excerpts

Monday 2nd July 2012 Grand Committee

Moved by

[Lord Rosser]

17: Clause 7, page 6, line 42, at end insert—
“( ) The CAA must, at such intervals as it considers appropriate, review market power determinations made on the basis of an earlier analysis.”

[Lord Rosser]

My Lords, this is a probing amendment. The Bill provides that operators of dominant areas located at dominant airports require a licence to levy charges for airport operation services, and states that an airport area is dominant if the CAA makes a determination that the market power test is met in relation to the area. Subsection (8) of Clause 7 states that the Civil Aviation Authority may make separate market power determinations in respect of different areas at the same airport with the same relevant operator and may also make a market power determination in respect of an airport area that consists of two or more areas that are not adjacent if the areas are located at the same airport. Subsection (9) then states that a market power determination ceases to have effect if the Civil Aviation Authority publishes a notice of a further market power determination in relation to the airport area or in relation to an area that includes all of the airport area.

The effect of the amendment, which would add further words to the end of Clause 7(8), would be to require the Civil Aviation Authority, at such intervals as it considers appropriate, to,

“review market power determinations made on the basis of an earlier analysis”.

It is not clear whether other wording in the clause, or elsewhere in the Bill, is intended to require the Civil Aviation Authority to review decisions that it has made on market power determination. Circumstances can change over a period of time, and factors that were important in the original decision may cease to be so, or other factors may come into play.

Other subsections in Clause 7 say that the Civil Aviation Authority may make a determination that the market power test is or is not met in relation to an airport area, and that the Civil Aviation Authority must make a market power determination if asked to do so by the operator of the airport area or any other person whose interests are likely to be materially affected by the determination, subject to certain laid-down criteria being met.

There ought to be a requirement for the Civil Aviation Authority to review market power determinations it has made, irrespective of whether it is asked to do so. Subject to what the Minister has to say in reply, that does not appear to be a requirement laid down in the Bill. Even the reference in subsection (1) to the Civil Aviation Authority making a determination whenever it considers it appropriate to do so is not clear as to whether it also means reviewing a market power determination it has made that the test has been met or whether it applies only to making determinations where it has not previously been decided that the test has been met.

If the Minister does not intend to accept the amendment, I hope that he will say why the Government do not consider it appropriate, if that be their argument, or which provisions already in the Bill cover the issue raised in the amendment. Perhaps the Minister could also say how often the Government expect the Civil Aviation Authority to be making market power determinations. Are they likely to be regular occurrences and is it anticipated that such decisions will have to be revised or amended on a regular or frequent basis or only rarely? I beg to move.

[Lord Jenkin of Roding]

I was surprised at the last sitting of the Committee when my noble friend made it clear that it is envisaged by the Government that there should be competition between two different terminals at the same airport. At an airport such as the JFK International in New York, where the terminals are situated widely apart and are approached in different ways, there may be some sense in that. Even in as large an airport as Heathrow, which now has five terminals, I find it difficult to conceive how there could be competition between the various terminals. It is built into this clause, on which the noble Lord, Lord Rosser, has moved his amendment, which seems to have some merit.

I would be grateful if, in responding, my noble friend could describe how he sees such competition arising. At the moment, taking Heathrow or Gatwick as an example, they are all under the same management. It may be separate between the airports; I find it difficult to conceive how it might happen between terminals. I would be grateful if my noble friend could explain how this might come about. It would obviously need to involve a change of ownership between the different terminals. Is there any prospect of that or is it somehow envisaged that there should be competition without a change of ownership? Perhaps my noble friend might explain that.

--- Later in debate ---

[Earl Attlee]

My Lords, the large airport test certainly applies in Clause 7(2), which refers to areas located in large airports. It goes on to define a large airport. I suspect that the CAA can make a determination on any other airport at a later stage if it becomes apparent that it might be in need of regulation and meets the tests in the Bill. Therefore, I invite the noble Lord, Lord Rosser, to withdraw his amendment.

[Lord Rosser]

Perhaps I might ask the noble Earl one last question before I withdraw my probing amendment. The thrust of his response seemed to be that what I sought to achieve with the amendment was covered by other parts of Clause 7. Do other parts of Clause 7 allow the CAA to initiate a review of an earlier decision that it has made off its own bat, or only if it is asked to by a person listed in subsection (3)?

[Earl Attlee]

My Lords, my understanding is that as soon as the CAA realises that it is appropriate to initiate a review because circumstances have changed, it can do so.

--- Later in debate ---

[Lord Rosser]

That is a very clear answer. The Minister has said that the CAA can do it off its own bat. I will want to read the Minister’s response carefully but my initial reaction is that if the Minister is saying that my amendment is covered by other wording in Clause 7, the point that I seek to establish has been met. I will not go down the road of competition, which has been raised, since that will be dealt with by a subsequent amendment. I will wait for it to appear. I thank the Minister for his response and beg leave to withdraw the amendment.

Amendment 17 withdrawn.

--- Later in debate ---

[Earl Attlee]

My Lords, in moving government Amendment 20, I shall speak also to government Amendments 21, 22, 23, 30, 32, 33, 35 to 45 and 61 to 63. These 20 amendments are being taken together because they all relate to appeals to the Competition Commission and the Competition Appeal Tribunal. Some 13 of the amendments give effect to our position that the Competition Commission and the Competition Appeal Tribunal should decide appeals on the same grounds. The other seven amendments ensure that both the Competition Commission and the Competition Appeal Tribunal have regard to the duties imposed on the CAA as set out in Clause 1 when deciding an appeal. For brevity, I will refer to the Competition Commission as the CC and to the Competition Appeal Tribunal as the CAT.

It has come to the Government’s attention that the current drafting in the Bill gives rise to inconsistency between the grounds on which the CC and the CAT may allow an appeal. In the present drafting, although the legal grounds on which an appeal may be allowed are the same, the CAT is specifically required to decide the appeal by reference to these grounds and “on the merits”. There is no equivalent provision for the CC to decide the appeal “on the merits”.

The Government are concerned that this inconsistency creates unnecessary and undesirable legal uncertainty. We wish to correct this to shut out any risk that under the current wording it could be interpreted that different powers are being conferred on the CC and the CAT. In summary, these amendments propose changes to the provisions about appeals to the CAT to align them with provisions about appeals to the CC.

Amendment 30 is to one of the grounds on which the CC may allow an appeal under Clauses 24 or 25 which relate to appeals against conditions of new licences and modifications to the licence conditions. The amendment would change the ground on which the CC may allow an appeal from,

“that the decision was based on the wrong exercise of a discretion”,

as it is currently in the Bill, to,

“that an error was made in the exercise of a discretion”,

as per the amendment. This amendment is being made to clarify the current drafting.

The remaining amendments are specific to appeals brought before the CAT. Amendments 35, 36, 37, 40, 43 and 61 delete the subsections that contain the current grounds on which the CAT may allow an appeal in Schedules 1, 3, 4, 5 and 13. Amendment 20 deletes a provision stating that an appeal may be brought on only one of the current grounds. Amendments 21, 38, 41, 44 and 62 replace these grounds with the same grounds as provided for in Clause 26 concerning appeals to the CC from,

“that the determination is based on the wrong exercise of a discretion”,

to,

“that an error was made in the exercise of a discretion”.

In particular, Amendments 21, 38, 41, 44 and 62 ensure that the CAT’s consideration of appeals is consistent with the CC’s by, first, removing the phrase “on the merits” from the grounds on which the CAT must decide an appeal, as just discussed; secondly, introducing an overall requirement that the decision appealed against was wrong on specified grounds—error of fact, wrong in law, and error in the exercise of discretion; thirdly, restricting the grounds for determining the appeal in the same way as for the CC; and, fourthly, reflecting Amendment 20 which, as I have just mentioned, clarifies the grounds of wrong exercise of discretion.

The overall result of these 13 amendments is that both the CC and the CAT may allow an appeal only to the extent that they are satisfied that the decision appealed against was wrong on one or more of the following grounds: that the decision or determination was based on an error of fact; that the decision or determination was wrong in law; and that an error was made in the exercise of a discretion.

These amendments are important to deliver the Government’s policy intention that the grounds on which the CC and the CAT decide appeals should be the same. They are also in keeping with our wish to deliver an efficient and effective appeals regime. These amendments allow the CC and the CAT to take a decision that offers something more than judicial review but does not extend to a potentially lengthy full rehearing of the case. The remaining seven amendments again ensure consistency between the two bodies. Amendments 32 and 33 to Clause 30 specify that when the Competition Commission is carrying out its functions as specified under subsection (4) of Clause 30, it must have regard to the matters,

“in respect of which duties are imposed on the CAA by section 1”.

Amendments 22, 39, 42 and 45 import an express duty on the CAT to have regard to the CAA’s duties as set out in Section 1 when deciding an appeal under Schedules 1, 3, 4 and 5. Amendment 63 imports an express duty on the CAT to have regard to the CAA’s duties as set out in Section 4 of the Civil Aviation Act 1982 when deciding an appeal under Schedule 13. My officials have engaged extensively with the CAT and the CC on this matter and they are content with the amendments. I commend them to your Lordships.

[Lord Rosser]

My Lords, perhaps I may take one of the amendments in the group to make my point. Government Amendment 30 deletes paragraph (c) in Clause 26, which says that the Competition Commission may allow an appeal under Section 24 or 25 only to the extent that it is satisfied that the decision appealed against was wrong on one or more of the following grounds, one of which is that the decision was based on the wrong exercise of a discretion. That wording has now been replaced in government Amendment 30 with the wording,

“that an error was made in the exercise of a discretion”.

I endeavoured to listen carefully to what the Minister had to say about this group of amendments and, if he did cover my point, I would be grateful if he could repeat his explanation. He seemed to say that this was all about clarifying the current drafting as opposed to explaining what the difference was between the wording in the Bill and what is being proposed, bearing in mind that it is not the same wording and therefore presumably does not mean exactly the same.

It would be helpful if the Minister could explain what this change in wording means. I refer to government Amendment 30 to paragraph (c) in Clause 26. Does the change from “wrong exercise” mean that although a decision was made incorrectly, the process was fine and the options to choose from were correct, the proposed wording,

“an error was made in the exercise of a discretion”,

is meant to imply that the exercise itself was flawed, had the wrong information to hand, was conducted incorrectly and options were considered that should not have been? It is important that we do not just get told, “We are seeking to clarify the current drafting”, but that we have a full explanation as to what the current wording in Clause 26 means—this relates to,

“that the decision was based on the wrong exercise of a discretion”,

and how that differs in meaning from the wording with which Amendment 21 replaces it,

“that an error was made in the exercise of a discretion”.

I hope that the Minister can clarify the position.

[Lord Soley]

Before the Minister replies, I was looking at this with some interest. I cannot help feeling that the issue might be one of parliamentary drafting. I would like to know whether the CAA, the airlines or the Competition Commission asked for the wording to be changed. My noble friend Lord Rosser has already pointed out that there is a change of wording, with “the wrong exercise”, but it is also odd that the original wording from Schedule 1 is in the present tense, whereas the wording in the amendment is in the past tense. I cannot help feeling that the parliamentary draftsman who did it first was found to have got something slightly wrong; I am not sure what. It is puzzling why that wording has changed from the present to the past tense, unless it is just for a legal reason. If there is another reason, I would like to see where the amendment came from and why.

--- Later in debate ---

[Earl Attlee]

My Lords, the amendment is intended to provide clarity.

[Lord Rosser]

Perhaps I may ask the Minister to clarify what the wording means. When I made my contribution a few moments ago, I asked whether the current wording,

“wrong exercise of a discretion”,

meant that if a decision was made incorrectly, the process was fine and the options to choose from were still correct. I then asked if the new wording,

“error … made in the exercise of a discretion”,

was intended to imply that that the exercise itself was flawed, that it had the wrong information to hand or was conducted incorrectly, and that options had been considered that should not have been. Does the wording we now have mean one of those two options—and, if so, which one?

[Earl Attlee]

My Lords, it is probably best if I write to noble Lords; this is a very technical point.

--- Later in debate ---

Moved by

[Lord Rosser]

28: Clause 24, page 17, line 19, at end insert—
“( ) that the appeal does not demonstrably show that it is in the interests of users of air transport services”

[Lord Rosser]

My Lords, as we have just been discussing, Clauses 24 and 25 deal with appeals to the Competition Commission in respect of, first, the conditions of new licences and, secondly, modification of licence conditions. Under the Bill, persons who operate a dominant area at a dominant airport require a licence to levy charges. An appeal lies to the Competition Commission against a decision by the Civil Aviation Authority to include, or not to include, a condition in a licence when it is granted, and an appeal also lies to the Competition Commission against a decision by the Civil Aviation Authority to modify a licence condition.

An appeal can be brought only with the permission of the Competition Commission and the Bill states that the Competition Commission may refuse permission to appeal only on one of the following grounds: that the appeal is brought for reasons that are trivial or vexatious, or that the appeal does not have a reasonable prospect of success. Clearly, from the wording in the Bill there is a concern that trivial or vexatious appeals should be stopped. I am sure we would all agree with that objective, and my amendment seeks to add in a further ground on which permission to appeal can be refused—namely, that the appeal does not demonstrably show that it is in the interests of users of air transport services, in order to further minimise the potential for frivolous or vexatious appeals.

The primary duty of the Civil Aviation Authority, as set out in Clause 1, is that it must carry out its functions in a manner which it considers will further the interests of users of air transport services regarding the range, availability, continuity, cost and quality of airport operation services. Surely, then, there must be an argument for saying that in any appeal to the Competition Commission against a decision by the Civil Aviation Authority to include, or not to include, a condition in a licence, or in any appeal against a decision by the CAA to modify a licence condition—both instances relating to persons who operate a dominant area at a dominant airport—it should also have to be shown quite clearly that the appeal is in the interests of users of air transport services, bearing in mind that that is the primary duty and responsibility placed on the Civil Aviation Authority, whose decision is being appealed.

Clause 30, on the procedure on appeals, states that subsections (1), (2) and (5) of Clause 1 apply to the carrying out by the Competition Commission of its function of deciding an application for permission to appeal under Clauses 24 and 25. Clause 30 refers to subsections (1) (2) and (5) of Clause 1, and subsection (1) refers to the Civil Aviation Authority having, where appropriate, to carry out its functions in a manner which it considers will promote competition in the provision of airport operation services. In a debate on an amendment when we were previously discussing the Bill in Committee, the Minister said that subsection (1) of Clause 1 would take priority over subsection (2) as far as the Civil Aviation Authority was concerned if promoting competition in the provision of airport operation services conflicted with its duty under subsection (1) to carry out its functions in a manner which the Civil Aviation Authority considers will further the interests of users of air transport services regarding the range, availability, continuity, cost and quality of airport operation services.

However, it is not clear whether the giving of priority to subsection (1) over subsection (2) in Clause 1 where there is any sort of conflict applies also to the Competition Commission under Clause 30. Without it apparently being clear that it does, the Competition Commission, bearing in mind its name, might well give greater weight to promoting competition when deciding whether or not to refuse permission to appeal, rather than wanting to satisfy itself that the appeal is in the interests of users of air transport services, which is clearly stated in this amendment and is in accordance with the primary, overriding duty of the Civil Aviation Authority as laid down in Clause 1(1).

I hope that the Minister will either accept the amendment or be able to provide an assurance that giving priority to subsection (1) over subsection (2) in Clause 1 applies equally to the Competition Commission in Clause 30 as to the Civil Aviation Authority. I beg to move.

[Earl Attlee]

My Lords, I thank the noble Lord for explaining the concerns that his amendments seek to address. However, I believe that the Bill already takes those concerns into account. The proposed appeals process has been carefully designed to ensure that where an appeal is brought, ordinarily for it to succeed, the appeal body should consider whether it is in passengers’ interests in the provision of airport operation services. It is our aim to have in place an appeals process that facilitates transparency and a timely manner of resolution of appeals, and that permission to appeal should be granted only where appropriate. However, we do not wish to stop those whose interests are materially affected from appealing. In meetings with airlines and airport bodies, my officials have sought to assure parties of this.

Clauses 24(5)(b) and 25(5)(b) as currently drafted already ensure that permission to appeal a licence condition or licence modification would be refused if the appeal did not have a reasonable prospect of success. Where an appeal had a reasonable prospect of success, it would be unjust and wrong in principle to refuse permission. In answer to the important question put by the noble Lord, Lord Rosser, I refer the Committee to Clause 30, which contains provisions stating that the Competition Commission “must have regard” to the same duties as the CAA in the discharge of stated functions. Included in these is the determination for permission to appeal under Clauses 24 and 25.

The Bill as drafted empowers the Competition Commission to refuse to grant permission to appeal so as to avoid parties bringing an appeal as a “spoiling” tactic. Nor can appeals be used as a delaying tactic. The default position is that the CAA’s licence condition or modification comes into effect while the appeal is being heard. Therefore, I do not believe that the inclusion of a further subsection in Clauses 24 and 25, as suggested by the noble Lord, would add anything of further substance to the Bill.

In the light of those assurances, I hope that the noble Lord will be willing to withdraw his amendment.

[Lord Rosser]

Before I do so, while I think that the noble Earl has probably given me the assurances that I seek, perhaps I may ask him again directly whether he is saying clearly that, under the terms of Clause 30 where it states—as I indicated and the noble Earl has repeated—that subsections (1), (2) and (5) of Clause 1 apply to the carrying out by the Competition Commission of its functions, which include determining appeals brought under the two clauses that we are talking about, in carrying out those functions the Competition Commission is bound in the same way under Clause 1(1) and (2) as the Civil Aviation Authority is itself. Will it have the same general duty in respect of determining whether those appeals should be heard? In other words, it is to give priority—and see as its primary duty as the Competition Commission—to making the decision to furthering,

“the interests of the users of air transport services regarding the range, availability, continuity, cost and quality of airport operation services”,

thus ensuring that that duty overrides the duty to promote competition in the provision of airport operation services. I think that that is what the Minister said to me, but I should be grateful if he could confirm that that is the case.

[Earl Attlee]

My Lords, the Competition Commission must have regard to the CAA’s general duty under Clause 30, as per the set of amendments accepted earlier today. We do not believe that it would be sustainable for the Competition Commission to promote competition where to do so would be inimical to the interests of users of air transport services, as described in Clause 1(1).

--- Later in debate ---

[Lord Rosser]

I do not seek to play with words; I am just anxious to be clear. The Minister said that the Competition Commission must “have regard”. Does that mean that its general duty in hearing these appeals is the same as the CAA’s general duty under Clause 1, which states that its primary and overriding responsibility in determining whether those appeals should be heard is to,

“further the interests of users of air transport services”,

rather than, where there is a conflict, to promote competition? I do not know whether we are playing with words over “have regard to”. In the Minister’s view, does that mean that the Competition Commission is bound in the same way as the CAA is in its general duty under Clause 1(1) and (2)?

[Earl Attlee]

My Lords, the short answer to the noble Lord’s question is yes.

[Lord Rosser]

In that case, since the Minister’s very specific answer makes it clear that the Competition Commission has the duty in the same way as the CAA has the duty under Clause 1(1) and (2), I beg leave to withdraw the amendment.

Amendment 28 withdrawn.

--- Later in debate ---

Moved by

[Lord Rosser]

31: Clause 29, page 20, line 26, leave out “within a reasonable time” and insert “within the period of 24 weeks beginning with the day on which the Competition Commission published the relevant order”

[Lord Rosser]

The amendment relates to Clause 29, which deals with appeals determined by the Competition Commission under Clauses 24 and 25, which we have just discussed. Clause 29 states:

“A determination made by the Competition Commission … must be contained in an order”.

Later, it states that the Civil Aviation Authority,

“must take such steps as it considers requisite for it to comply with the order”.

It then goes on to say:

“The steps must be taken … if a time is specified in the order or is to be determined in accordance with the order, within that time, and … otherwise, within a reasonable time”.

The effect of the amendment would be to remove “within a reasonable time” and insert,

“within the period of 24 weeks beginning with the day on which the Competition Commission published the relevant order”.

This is a probing amendment, which seeks to find out what the Government mean by “within a reasonable time” and how they believe those words should be interpreted. Do they mean more or less than 24 weeks and, if it could be more than 24 weeks, will the Minister give some examples of where it might be reasonable for the Civil Aviation Authority to take longer than 24 weeks to comply with an order made by the Competition Commission when no specific timescale is laid down by it? It would also be helpful if the Minister could say who will be responsible for deciding whether the Civil Aviation Authority has taken steps to comply with an order within a reasonable time. Will it be the Civil Aviation Authority itself, the Competition Commission, the Secretary of State, the courts or some other individual or body?

As I say, this is a probing amendment. I hope I have explained the motive for tabling it and the issue that we hope the noble Earl will address. I beg to move.

[Earl Attlee]

My Lords, the amendment seeks to amend subsection (7)(b) of Clause 29. The clause contains provisions relating to the publication of, and other matters connected to, the determination of appeals.

The current drafting provides that the CAA must take steps to comply with the appeal determination within any time period specified in the order. When none is specified, it must do so within a reasonable time. I am unable to support the amendment for two reasons. First, we do not think that it is necessary. Under subsection (7)(a) of the clause, the Competition Commission may specify a time limit in the order. We would expect it to do so if and whenever appropriate. Why would it not do so? Secondly, in circumstances where it is not appropriate to specify a period, it will be necessary to afford the CAA a reasonable time within which to comply with the order. What will comprise a reasonable time depends upon the context. There may be cases where action should be taken in fewer than 24 weeks and others where it is not reasonable to expect the CAA to take action within that period.

The noble Lord, Lord Rosser, asked me to give examples. I do not have any to hand but there may, I suggest, be a requirement to provide IT facilities or some capability that might require the CAA to procure something. It simply would not have time to take the necessary procurement action, although it might have every intention of doing so and perhaps give assurances that it would do so.

Against this background, to set an arbitrary time limit of 24 weeks is not appropriate and may cause injustice. Therefore, it is prudent to retain the flexibility that subsection (7)(b) provides the CAA. This flexibility is consistent with our wish for the CAA to be an efficient regulator but to allow it appropriate periods of time to comply with orders. I hope that in the light of my explanation the noble Lord will be willing to withdraw the amendment.

[Earl Attlee]

My Lords, I am not a lawyer but I do not have any difficulty in understanding the provisions. I do not understand why the Competition Commission or the Competition Appeal Tribunal would not set a time limit if it were appropriate to do so. If it were inappropriate—the CAA might have said that it was already complying and had no intention of stopping complying—it would be totally unnecessary to impose a time limit. However, I would expect the Competition Commission to impose a time limit if it were desirable.

[Lord Rosser]

I thank the Minister for his reply. I also thank my noble friend Lord Clinton-Davis for the points he made. Obviously it is my intention to withdraw the amendment since it is probing in nature, but will the Minister respond to the other point I made about who will determine whether it has been done within a reasonable time? The clause provides that it should be done “within a reasonable time” if no time limit is set. Who makes the decision as to whether it has been done within a reasonable time?

[Earl Attlee]

My Lords, I do not know the answer to that question, but I imagine that if it was not done within a reasonable time, there would be a mechanism for the appellant to go back to the Competition Commission or the Competition Appeal Tribunal. However, if I have got that wrong, obviously I will write to the noble Lord.

[Earl Attlee]

My Lords, the terms “a reasonable time” and “a reasonable person” are frequently found in legislation. The noble Lord is absolutely right.

[Lord Rosser]

I am happy to leave this in the context that if the Minister finds that the response he has given to me on who will determine whether it has been done within a reasonable time is not the position, he will write to say that. As I say, it is a probing amendment to try to find out more about the Government’s intentions so far as the definition of “within a reasonable time” is concerned, and what kind of cases might come within that category rather than in subsection (7)(a), which provides that,

“if a time is specified in the order”.

I thank the noble Earl for his response and I beg leave to withdraw the amendment.

Amendment 31 withdrawn.

--- Later in debate ---

Moved by

[Lord Rosser]

46A: Schedule 8, page 99, line 2, at end insert—
“(11A) An order under this Part is to be made by statutory instrument.
(11B) A statutory instrument containing an order under subsection (11) must not be made unless a draft of the instrument has been laid before, and approved by resolution of, each House of Parliament.
(11C) Subsection (11B) does not apply where an order made under subsection (11) substitutes a greater sum for the sum specified in subsection (4)(a) to take into account an increase in the general level of prices, in which case it is subject to annulment in pursuance of a resolution of either House of Parliament.”

[Lord Rosser]

My Lords, the amendment addresses a recommendation from the Delegated Powers Committee. Paragraph 2 of Schedule 8 enables the Secretary of State to increase by negative order the £1 million threshold specified in sub-paragraph (4)(a) of Schedule 8 as the amount of annual turnover above which an airport operator is eligible for certification by the Civil Aviation Authority as a relevant airport operator.

When the Delegated Powers and Regulatory Reform Committee looked at the Bill, it apparently had in front of it a memorandum from the Department for Transport, which the department had prepared for the committee, explaining the delegated powers in the Bill. The report on the Bill that we now have from the Delegated Powers and Regulatory Reform Committee states that paragraph 64 of the memorandum—which must be the memorandum from the Department for Transport—explains that the purpose of the power in Schedule 8 to increase the £1 million threshold,

“is to enable the amount to be increased, for example to take account of any inflation”.

The Delegated Powers Committee said:

“If it is the Government’s intention that the purpose of the power … is to enable the Secretary of State by order to increase the threshold in line with inflation, this should be specified on the face of the Bill, in which case the negative procedure is appropriate. But if the threshold is to be increased for other reasons, the affirmative procedure should apply”.

My amendment seeks to specify that the Secretary of State can increase the threshold figure only by the affirmative resolution procedure unless the increase is made to keep in line with inflation, in which case the negative resolution procedure will be used.

I hope that the Minister will accept the amendment, which, unless we have misunderstood it, seeks to put into the Bill the views that the Delegated Powers Committee expressed in its report. Although the memorandum from the Department for Transport indicated that it would enable the amount to be increased to take account of any inflation, in which case the negative procedure would be appropriate, clearly if the Government were going to do rather more than simply seek to increase the figure in line with inflation, I would share the view of the Delegated Powers Committee that the affirmative procedure should apply. The purpose of the amendment is to seek to achieve that objective. I beg to move.

[Earl Attlee]

My Lords, I am grateful to the noble Lord, Lord Rosser, for tabling the amendment. An amendment of this kind would address a recommendation of the Delegated Powers and Regulatory Reform Committee in its helpful report on the Bill, which was published four days before the start of Grand Committee. I have no complaint, but we will need a little more time to determine which way to go. However, I agree with the general aim of the amendment and have much sympathy with it.

The current drafting of the amendment is not technically correct. It would need alternative drafting to make a consequential amendment to the Airports Act 1986, where the provisions are to be inserted. I therefore wish to consider the matter further, with the intention of bringing forward a government amendment on Report. However, I do not anticipate having any difficulty with accepting the advice of the DPRRC. I hope that this reassures your Lordships that my intention is for a government amendment to be brought forward on this, in order to respond effectively to the DPRRC recommendation that if the purpose of the order provided for in sub-paragraph (11) of paragraph 2 of Schedule 8 is to ensure that the threshold can be increased for reasons other than inflation, the current negative procedure should be amended to an affirmative procedure to give Parliament greater scrutiny. With this assurance, I hope that the noble Lord will withdraw his amendment.

[Lord Rosser]

I thank the Minister for that very helpful reply. I fully accept that the amendment might not be worded in the appropriate manner. It appears from what he said that he intends to take the matter away with a view to producing an amendment that is in the right place in the Bill and says the right things to achieve the recommendation of the Delegated Powers and Regulatory Reform Committee. On that basis, I beg leave to withdraw the amendment.

Amendment 46A withdrawn.

Civil Aviation Bill

Lord Rosser Excerpts

Wednesday 27th June 2012 Grand Committee

Moved by

[Lord Rosser]

2: Clause 1, page 1, line 13, at end insert “but only where this will not conflict with its ability to carry out its functions in a manner set out in subsection (1)”

[Lord Rosser]

This amendment and Amendment 13 relate to the Civil Aviation Authority’s general duty and the Secretary of State’s general duty, as set out in Clauses 1 and 2 of the Bill. I will direct my comments to the Civil Aviation Authority’s general duty though the argument is the same in respect of the Secretary of State’s general duty.

Under Clause 1(1), the CAA must carry out its functions under Chapter 1 of the Bill,

“in a manner which it considers will further the interests of users of air transport services regarding the range, availability, continuity, cost and quality of airport operation services”.

Subsection (2) goes on to say that:

“The CAA must do so, where appropriate, by carrying out the functions in a manner which it considers will promote competition in the provision of airport operation services”.

This amendment adds to the end of that,

“but only where this will not conflict with its ability to carry out its functions in a manner set out in subsection (1)”.

In the absence of any definition of what “where appropriate” in subsection (2) is intended to mean or how it is to be interpreted in the context of the Bill, there appears to be an assumption in subsection (2) that promoting competition in the provision of airport operation services will further the interests of users of air transport services. Promoting competition does not necessarily further the interests of users of air transport services regarding range, availability, continuity, cost and quality because it can lead to a reduction in range, availability, continuity, cost and quality in a bid to either reduce costs or sustain profit margins, or achieve both objectives.

The amendment seeks to ensure that the requirement to promote competition,

“by carrying out the functions in a manner which it considers will promote competition in the provision of airport operation services”,

does not apply where the Civil Aviation Authority considers that to do so would conflict with its primary responsibility of furthering,

“the interests of users of air transport services”.

It would surely be unacceptable for the CAA to have to carry out its functions in a manner that it considers would promote competition when to do so would conflict with what is presumably its key responsibility to further the interests of air transport services, as set out in subsection (1), rather than the interests of the providers of airport operation services. That would defeat what appears to be a declared objective in the Bill for the Civil Aviation Authority as set out in subsection (1).

I hope the Minister will accept the amendment. However, if he does not intend to do so, I hope that he will indicate the current wording in the Bill which will prevent the CAA having to carry out its functions in a manner which it considers will promote competition in the provision of airport operation services if it felt that to do so would conflict with its duty to carry out its function in a manner which it considers will further the interests of users of air transport services. The answer may be that the Government simply believe that promoting competition cannot not be in the interests of users of air transport services, which would be a remarkable view. Alternatively, it may be that the Minister will say that the words “where appropriate” in subsection (2) give the Civil Aviation Authority the power to decide that it will not promote competition in the provision of airport operation services because to do so would conflict with its duty under subsection (1) to carry out its functions in a manner which it considers will further the interests of air transport services. If that is the case, the Minister should give a detailed explanation of what the words “where appropriate” mean in the context of the provisions of subsections (1) and (2) and how they should be interpreted and applied by the Civil Aviation Authority. I beg to move.

[Lord Soley]

I have sympathy with my noble friend. However, I do not have any answers to the problem. It is very difficult. A clause such as Clause 1 imposes certain duties on an organisation—in this case the CAA—which is a normal format in Bills that become law. However, what troubles me about such clauses—and it is not only in this one, although it happens here too—is that there is a lack of clarity, as my noble friend has pinpointed.

Subsection (3)(b) has the catch-all phrase that,

“the need to secure that all reasonable demands for airport operation services are met”.

There is one of these provisions in almost all the Bills of this type that I know. It is put in in case we have forgotten something that the CAA may want or ought to do. It covers just about everything from whether the coffee machine works to whether you have good services in other more fundamental ways.

I wonder at times whether we are being clear with the operator. Presumably the CAA is happy with the clause—I assume that it is; I have not heard anything to the contrary—but I wonder about the clarity of its operation if this becomes law, as it almost certainly will. Does the CAA have enough clarity to know what its duties are if someone challenges it? A catch-all phrase such as that in subsection (3)(b)—that the CAA has to meet the reasonable demands for airport operation services—means that it can say in certain circumstances that it does not think that a particular demand is reasonable. It could rely on the phrase if it received a legal challenge from someone or some organisation.

It is a general point but sometimes we are casual with our legislation and put in catch-all clauses and subsections. We are saying to the operator that it can do what it likes within certain limits. It may be challenged in law, although that is unlikely, and this clause is there in case it is needed. It is a catch-all clause and my noble friend is right to raise this matter as a lack-of-clarity issue.

--- Later in debate ---

[Lord Rosser]

I thank the Minister for his response and my noble friend Lord Soley and the noble Lord, Lord Jenkin of Roding, for their contributions to the debate. I think that the noble Lord, Lord Jenkin, rather misunderstood the wording of the amendment or what I said. I did not seek to remove from subsection (2) the words that related acting in a way that promoted competition. The purpose of my amendment was to make sure that there could not be a conflict between subsections (1) and (2) by making sure that if there was a conflict, subsection (1) would prevail. That was designed so that activities would be carried out in a way that would be beneficial to the users of air transport services.

In his response, the Minister has taken one of the lines that I had suggested he might take in the contribution I made—namely, that he has argued that the words “where appropriate” in subsection (2) already achieve the objective that I sought to achieve with my amendment. In other words, that if it is considered that there is a conflict between subsections (1) and (2), then—as I understand it from what the Minister has said—the Civil Aviation Authority, using the words “where appropriate”, would be able to argue that subsection (1) took priority, because that is the primary responsibility. If I have understood the Minister correctly—and what he said as to how this should be interpreted is now on the record—then I beg leave to withdraw my amendment.

Amendment 2 withdrawn.

--- Later in debate ---

Moved by

[Lord Rosser]

8: Clause 1, page 2, line 19, leave out paragraph (b)

[Lord Rosser]

My Lords, this is an opportunity to debate a rather more mundane amendment compared with the ones we have just been discussing. This amendment and Amendment 14 in the group delete the references in Clause 1(4)(b) and Clause 2(5)(b) to the principle in the general duties of the Civil Aviation Authority and the Secretary of State respectively that,

“regulatory activities should be targeted only at cases in which action is needed”.

Clause 1(4)(a) and Clause 2(5)(a) both state that,

“regulatory activities should be carried out in a way which is transparent, accountable, proportionate and consistent”.

It is not entirely clear why either Clause 1(4)(b) or Clause 2(5)(b) is needed. Under subsections (4)(a) and (5)(a), regulatory activities should be carried out in a way that is proportionate, but surely it would not be proportionate if those regulatory activities were targeted at cases in which action was not needed. To do so would surely not be proportionate and would therefore be outside the terms of subsections (4)(a) and (5)(a). If the Minister is not inclined to accept my point that the subsection that this amendment deletes is unnecessary, it would be helpful if he could indicate why and also give some examples of regulatory activities that would be proportionate even though they were being targeted at cases where action was not needed. I beg to move.

--- Later in debate ---

[Earl Attlee]

Yes. However, we are talking about the principle of regulation that you do not do things that are unnecessary: you target your effort at a problem. If there is not a problem, you leave it alone.

The noble Lord, Lord Empey, asked whether the subsections could leave the CAA open to JR. These are secondary, subordinate obligations to which the CAA must have regard. Provided the CAA turns its mind to these matters and considers them, it will, prima facie, have complied with the obligation.

[Lord Rosser]

My Lords, I thank the Minister for his reply and other noble Lords who have taken part in this brief debate.

The Minister said that he will look at Hansard to see what point I was making. To reiterate, the question I am raising is: what is the necessity for the two paragraphs that my amendment seeks to delete? Paragraph (b) states that,

“regulatory activities should be targeted only at cases in which action is needed”.

That comes after paragraph (a), which states that,

“regulatory activities should be carried out in a way which is transparent, accountable, proportionate and consistent”.

I appreciate that the Minister has said that he will look at the question and respond but, to reiterate the question that I asked, how can something be proportionate if it is a regulatory activity targeted at a case in which action is not needed? Surely, by definition, if regulatory action is not needed and you take regulatory action, that cannot be proportionate.

I am happy to leave it in the context that the Minister will look at the point I have raised and respond to me. I would be grateful for that. I am asking a genuine question. We are all interested in making sure that there is no unnecessary verbiage in legislation, which is the point I am making about the two paragraphs that the amendment proposes should be deleted. However, in the context that the Minister will look at the issue and write to me, I am happy to withdraw the amendment.

Amendment 8 withdrawn.

Civil Aviation Bill

Lord Rosser Excerpts

Wednesday 13th June 2012 Lords Chamber

[Lord Rosser]

My Lords, this has been an interesting debate on a Bill that, as my noble friend Lord Smith of Leigh said, we broadly welcome and support, despite the lack of consolidation to which the noble Lord, Lord Jenkin of Roding, referred with some feeling. A considerable part of the Bill was drafted by the previous Labour Government, including important reforms to the aviation industry’s regulatory regime. The reforms cover the legislative framework for the economic regulation of airports and for the Civil Aviation Authority, and provide a primary duty to further the interests of passengers and freight owners. The Bill provides also for the transfer of certain aviation security functions from the Secretary of State for Transport to the Civil Aviation Authority, and the widening of the Secretary of State’s powers so that holidays sold by airlines or arranged on an “agent for the consumer” basis can be included in the Air Travel Organisers’ Licence scheme in future.

On the other side of the coin, environmental protection measures, which were in the original draft Bill, have now been excluded. A number of noble Lords, including my noble friends Lord Clinton-Davis, Lord Davies of Stamford and Lord Soley, referred to airport capacity and the position of Heathrow. There is no doubt that the Minister will wish to respond to this point, and to my noble friend Lord Davies of Oldham, who raised the question of the continuing lack of a government aviation policy.

On the issue of security regulation and the transfer of certain operational aviation security functions to the Civil Aviation Authority, there must be a suspicion, as my noble friends Lord Davies of Oldham and Lord Clinton-Davis said, in the current climate in which the Government have chosen to operate that it is the Secretary of State’s spending review rather than security considerations that will drive the change. The proposed change splits policy and operational matters. The Minister will need to explain how this will improve a security regime that has been in operation successfully since the tragic Lockerbie bombing, and how the proposed significant change in aviation security policy to an outcome-focused, risk-based approach from the current “direct and inspect” policy will operate in practice.

We shall need to know also what parliamentary scrutiny the new regime will receive, not least in order that the Secretary of State’s claim that the security policy changes will not in any way jeopardise what she accepts are the current high levels of security can be tested and checked. There is a risk that staff with considerable expertise in the security field will be lost to the service as a result of the proposed transfer of responsibilities and the uncertainty and upheaval that that will create.

The Government have said that they are keen that as many employees as possible stay in post when their jobs transfer to the Civil Aviation Authority, taking their skills and experience with them. What is the latest position on this issue? Will staff retain their current entitlements on pay, conditions, pensions and redundancy agreements, or should staff be concerned that the ideas of that expert government adviser on human relations, Mr Beecroft, may be implemented and the current arrangements on protecting existing terms and conditions of employment for staff transferring weakened? What assurances can the Minister give on this point?

My noble friend Lord Hunt of Chesterton referred to the importance of addressing environmental considerations. The environmental protection measures that were in the original draft Bill are not in the Bill we are now discussing, as my noble friend Lord Simon and the noble Earl, Lord Cathcart, have also pointed out. Perhaps this reflects the Government’s rapidly declining commitment to such issues. There is no longer a clear duty on the Civil Aviation Authority in terms of economic regulation to have regard to the airport operators’ compliance with environmental and planning considerations and law. Without this, airports may well be reluctant to invest in improving environmental performance. As other economic regulators have to take account of the environment, the Government will have to explain why they have not placed such a duty on the Civil Aviation Authority.

There is a case for ticketing to show the environmental impact of different modes of travel to help passengers make decisions, if they so wish, on which form of transport to use based on the environmental impact of travelling by air, by rail or by coach. Giving passengers better information on different modes of transport and what emissions are generated by journeys would provide the opportunity to make more environmentally friendly choices when travelling.

There should be tougher targets for reducing CO₂ emissions as the industry’s contribution to addressing climate change. The Government have declined to reaffirm even the target we agreed with industry and government. The Bill should lay down a duty for the Civil Aviation Authority to work with the Secretary of State, the Committee on Climate Change, NATS and air transport service providers to meet the UK’s carbon reduction targets.

The aviation industry also needs to reflect on whether it has given environmental considerations the public prominence they deserve. The image that the industry has in some eyes—fairly or unfairly—is of one that pays little regard to such considerations and the actual and potential adverse impacts they have on the public as the industry campaigns for more airport capacity and increasing numbers of flights. Being seen publicly to give environmental issues and concerns a high priority ought to be regarded as hard commercial sense by the industry, as one reason for the degree of opposition to increasing airport capacity and numbers of flights is no doubt a feeling—once again, justified or unjustified—that addressing the environmental consequences of such developments and the impact on the quality of life of those most affected is not a major concern of the industry and its leadership.

On the passenger experience, we agree with the Transport Select Committee in the other place and its concerns about the lack of any requirement to publish passenger welfare plans. My noble friend Lord Davies of Oldham reminded us that the experience faced by many passengers during the severe winter weather of 2010-11 demonstrated the need for the sector to improve its performance in relation to passenger welfare. The Bill does not appear to be robust in relation to the specific duties on airports in relation to passenger welfare and there needs to be a requirement for airports and the Civil Aviation Authority to give greater help to passengers stranded at airports. Putting this in the Bill, rather than leaving it to the regulator to decide whether to do it, would give a clear indication to the regulator that the Government expect this to be looked at as a key area.

We also agree with the Transport Select Committee in the other place that airport licences should be structured so as to address key areas of passenger satisfaction. The Civil Aviation Authority should also be a source of reliable information to passengers on issues that have a considerable impact on the quality and level of service to passengers at airports. There has been much publicity recently, for example, over queuing times at Heathrow Airport, and arguments and disagreements between the airport and the Immigration Service over how long people are having to queue. The Civil Aviation Authority should be able to play an important role here in collating the evidence and publishing it. What steps are the Minister’s department and the Home Office taking to work together more effectively to deal with the queues at immigration and passport control?

Passengers with disabilities and reduced mobility also need appropriate assistance at airports, especially when passing through security. The Government made a decision to abolish the Disabled Persons Transport Advisory Committee which provided a channel for the advice and experiences of disabled people to be given on improving transport provision. Such advice still needs to be fed-in to airports and policy-makers. The Civil Aviation Authority and the Secretary of State should have a duty to produce perhaps an annual report on the service offered to disabled people at airports and by air transport providers and the extent to which such a service meets the relevant guidelines and European legislation already in place.

However, it is not only at airports that at times passengers may not always feel that they are being treated as though they were valued customers. Another area of concern is over ticket prices and surcharges and the extent to which they are as clear and transparent as they might be. A recent survey, published last month in a national newspaper, showed that one well-known budget airline’s high-season rate for a 20 kilogram bag to go into the hold was £70 return, and if you did not book on-line but turned up at the airport with your bag the fee was £130 one way. The survey of budget airlines’ add-on charges showed that it could cost as much as £110 to change the name on a ticket and £120 because your bag weighed three kilograms over the limit. Add-on charges apply to a multitude of things, covering bags, credit card fees, name change fees, flight change fees and fees for taking on special items such as golf clubs.

When the survey tested costs for a one week return flight to Malaga for one person taking a 20 kilogram bag and paying by credit card, it found add-on costs ranging from £34.95 to £82 depending on the low-cost airline operator. One would have thought that this was an area in which the Civil Aviation Authority could play a role in the interests of passengers and in ensuring fairness and transparency.

Under the Bill, the Civil Aviation Authority remains outside the remit of the National Audit Office, despite it being in receipt of public money and being given important new functions. It should be subject to proper scrutiny and it should also have a duty of efficiency, as the noble Lord, Lord Jenkin of Roding, and my noble friend Lord Solely, said, a duty which, likewise, is not provided for in the Bill. As my noble friend Lord Davies of Oldham said, we will want to probe why the Government feel that the arrangements they have proposed will be adequate and appropriate and an improvement on what we are proposing.

We have a number of issues with the Bill that we will wish to pursue in Committee and, in some instances, also on Report depending on the responses we receive to the points we shall be raising. The Bill lays down a primary duty to further the interests of passengers. While we recognise the progress that the Bill represents, we do not consider that as much has been done in the Bill in this regard as could and should have been. However, in overall terms, we support the Bill, much of which was initially drafted by the previous Government. We shall be seeking in our detailed consideration of the Bill to make it even better.

People Trafficking

Lord Rosser Excerpts

Thursday 2nd February 2012 Lords Chamber

[Lord Rosser]

My Lords, last month the Government introduced amendments to the Protection of Freedoms Bill to meet some requirements of the recent EU directive on human trafficking. However, they do not yet appear to be addressing the disappearance from the system of child victims of trafficking in this country. Some 32 per cent of identified child victims of trafficking went missing from care between 2007 and early 2010.

Since Articles 12 and 13 of the EU directive state that signatories must provide assistance, support and protection for child victims of trafficking, will the Minister say on what basis, and in the light of what consultations with which organisations, the Government have decided that the UK currently complies with those two articles? What is the Government’s response to calls by charities such as CARE and ECPAT UK for the introduction of a system of guardianship for child victims of trafficking?

The directive requires that the UK establishes a national rapporteur to independently monitor the implementation of the directive. Is it the Government’s intention to give this responsibility to an individual or a committee independent of government in order to ensure both effective oversight of the implementation of government policy on trafficking and accountability?

The Government have indicated that they believe parts of the directive can be implemented in full through secondary legislation and through operational measures and routes. Not everyone will share the Government’s view on that point, but we will wait to see the provisions of any such secondary legislation.

I thank the noble and right reverend Lord, Lord Eames, for securing this debate. We welcome the progress that has been made in combating human trafficking, but it is clear that there is still much to do.

[Earl Attlee]

My Lords, I congratulate the noble and right reverend Lord, Lord Eames, on securing a debate on this important matter and I thank him for raising it today with his usual skill and measured tone. I broadly accept your Lordships’ analysis of the situation. The Government certainly share the noble and right reverend Lord’s forcefully put view that human trafficking is a horrendous crime that needs to be addressed in a systematic and co-ordinated way. Right at the top of that process is my right honourable friend the Home Secretary, and I can assure noble Lords that she takes this matter very seriously.

As noble Lords have rightly observed, estimating the numbers of adults and children trafficked into and within the UK is difficult owing to the hidden nature of this criminal activity, but through the national referral mechanism we are starting to gain some valuable data about the scale of the problem. We know how many victims are referred. What we do not know is how many trafficking operations were successfully deterred or disrupted by the policies of this Government and the previous Government. However, for those victims we do indentify, our systems are now much more able to support them, according to their individual needs. I do not accept that Ministers underestimate the scale of the problem just because we cannot accurately measure it.

In answer to the right reverend Prelate the Bishop of Derby, I agree that this is a moral issue. I am sure that Ministers would still not be happy even if we had reduced the numbers to only 100 people being trafficked. We would not stop until we could get it to almost zero. I assure the House that this Government continue to use all resources at their disposal to identify, prosecute and convict traffickers, often working with other countries to bring the perpetrators of this crime to justice.

The noble Baroness, Lady Goudie, talked about the problem of forced labour within the UK. I can assure her that the Government are well aware of that problem.

We continue to review our approach to trafficking to ensure that we remain one step ahead of those seeking to exploit our borders. My noble friend Lady Jenkin raised the problem of men being trafficked out of the UK to places such as foreign construction sites. I was not personally aware of this but I will discuss it with my officials afterwards.

Free movement between the UK and the Republic of Ireland continues to be of immense importance to the economic, social and cultural well-being of both countries. I can assure noble Lords that the UK and Irish Governments are working in partnership to prevent abuse of the common travel area by strengthening its external border while preserving the right of free movement within it for those who are lawfully present. That is enforced by the UK Border Agency and the police carrying out intelligence-led operations to target the potential abuse of the CTA and to identify those who would otherwise seek to avoid UK controls.

Many noble Lords have expressed concerns about the vulnerability of children seeking to travel on Eurostar. Children and any accompanying adults looking to travel to the UK by Eurostar are routinely interviewed at our juxtaposed controls in France and Belgium. Officers seek to establish the relationship between children and the adults who are accompanying them or meeting them on arrival in the UK before allowing them to leave the juxtaposed border control. If trafficking is suspected, they are immediately reported to the appropriate French or Belgian authorities.

The UK Border Agency closely monitors all trains arriving from Brussels and Lille and carries out detailed checks on passengers where it is suspected that a passenger has evaded the juxtaposed controls. Full ticket controls are routinely mounted at St Pancras, Ebbsfleet and Ashford upon notification of a potential passenger who is seeking to arrive in the UK with a ticket to Lille. To supplement this, multi-agency child safeguarding periodic monitoring exercises advised by Paladin are also conducted at St Pancras. We are currently working closely with our Belgian counterparts and Eurostar to resolve the underlying issues.

My noble friend Lady Doocey raised the problem of unaccompanied children. The travel documentation and letter of consent for all unaccompanied children on Eurostar services are examined by border force officers at the controls. It is important to understand that the form signed by the parent or guardian is not designed to be a reliable check in itself; rather, it is the starting point for any inquiries that might be made by the authorities as they see fit. My noble friend also asked me to give undertakings as regards this being an operational matter for Eurostar. Officers regularly contact the parents or guardians of unaccompanied children to verify the letter of consent for travel to the UK. If there is any cause for concern on the authenticity of the consent of the parent or guardian or about the reception arrangements in the UK, officers will interview the parent or guardian. If doubts persist after all appropriate checks have been undertaken, the UK Border Agency may prevent the child travelling to the UK unaccompanied. For those children who do travel, staff at St Pancras identify unaccompanied children as they disembark and escort them to the concourse to ensure that the sponsor is present and is known to the child.

However, in my capacity as government spokesman for DfT matters in your Lordships' House, I have asked my officials to seek a visit by me to Eurostar at St Pancras. I would expect to include an examination of British Transport Police operations in that visit. I am sure that as a high-profile and responsible operator, Eurostar will be keen to show me first hand how it deals with the problems which my noble friend has identified.

Many noble Lords, including the noble Baroness, Lady Massey of Darwen, and the noble and learned Baroness, Lady Butler-Sloss, are concerned that we might not be compliant with the EU directive because we do not appear to have a national rapporteur. However, the UK is already compliant with this measure through equivalent mechanisms in the form of the UK Human Trafficking Centre as the central repository for data and the interdepartmental ministerial group for oversight. I believe that this meets the need identified by the noble Earl, Lord Sandwich. This equivalent mechanism is broadly in line with practice among our EU neighbours. We are aware of only two countries within the EU that have an independent national rapporteur on human trafficking—the Netherlands and Finland—and I am not convinced that they each operate in the same way. Several noble Lords have referred to the interdepartmental ministerial group. We recognise the need to work across government and we will consider how to strengthen the group to fulfil the national rapporteur role in the coming months. It is important to understand that the EU directive on national rapporteurs requires a national rapporteur or equivalent mechanism to assess trends in human trafficking and activities on anti-trafficking, and to work with civil society organisations and to report. It does not require the role to be independent.

Responsibility for the care, protection and accommodation of child trafficking victims falls within the designated responsibilities of local authorities for safeguarding and promoting the welfare of all children under the provisions of the 1989 and 2004 Children Acts. To support local authorities, we recently revised practice guidance on safeguarding trafficked children with the Department for Education, which will aid practitioners in identification and safeguarding of child victims of this horrible crime. Once a child is placed in care, a care plan is drawn up by their allocated social worker bringing together a range of information and support. The social worker will assess suitable accommodation, educational support and other services based on need. This care plan is regularly reviewed by an independent reviewing officer to ensure that the child’s needs are being met. This will include stability, safety and emotional well-being. IROs are also able to assist the child in obtaining legal advice. My noble friend Lord McColl of Dulwich talked about his important amendments to the Protection of Freedoms Bill. I am sure that my noble friend Lord Henley is looking forward to responding in due course. New guidance for IROs makes it clear that every child has the right to be supported by an advocate. The advocate must accurately represent the child’s wishes and feelings, irrespective of personal views on the child’s best interests.

Another key area is that of missing trafficked children, a point raised by the noble Lord, Lord Rosser, among others. Your Lordships should not underestimate the progress the Government have made on this. The first CEOP scoping report on this issue, published in 2007, found a shocking 55 per cent of trafficked children missing from their care placement, but with effective work at a local level to tackle this issue, the most recent CEOP strategic assessment showed that this figure had been reduced to 18 per cent. Local authorities such as Hillingdon, Hertfordshire and Harrow are leading the way with proactive, multi-agency partnerships to identify and safeguard trafficked children from going missing from care. Simple changes to the way they handle, for instance, a child’s access to accommodation front doors, mobile phones and other issues have allowed them to make great progress in reducing the number of children going missing. The national picture is still not good enough but the figures are undeniably heading in the right direction. The new human trafficking strategy commits us to working to raise awareness of these issues locally to ensure in all areas where there is evidence that a child has been trafficked, care planning and activities to support the child must minimise the risk of traffickers reinvolving the child in exploitative activities.

As usual, where I have not been able to respond fully to noble Lords’ substantive points, I will, of course, write. In summary, I can assure the House that this Government will lead the fight with our partners at all levels to ensure that our response to this crime remains an effective deterrent to drive down the number and level of people affected.

[Lord Rosser]

As the Minister is closing his comments, in the light of what he said about the Government’s determination to fight human trafficking—I am sure that is the case—is it the Government’s view that sentences for human trafficking are appropriate, bearing in mind that the average determinate custodial sentence for drug trafficking appears to be some 50 per cent higher than that for human trafficking?

[Earl Attlee]

My Lords, that is a detailed question on which I shall have to write to the noble Lord. An interesting problem is that it can be very difficult to secure prosecutions for trafficking. Often we see criminals being prosecuted for offences other than trafficking because it is easier to secure the evidence. I neglected to answer the question asked by the noble Lord, Lord Bew, about a possible gap in the legislation in Northern Ireland. I can assure him that we have not revoked anything and that there will be no gaps.

Rail: Great Western Passenger Franchise

Lord Rosser Excerpts

Tuesday 31st January 2012 Lords Chamber

[Lord Rosser]

My Lords, an issue raised by train operators is that, as the noble Lord, Lord Bradshaw, said, if they want to increase rolling stock capacity to meet extra demand, they have to secure the approval of the Department for Transport either to use existing rolling stock more intensively or to lease additional rolling stock from the leasing companies. The approval of the Department for Transport is also required before train operators can speed up scheduled services following improvements to the infrastructure. Will the Government make provision in the new Great Western passenger franchise and in existing and other new franchises to enable the train operator to make such changes in future, subject to the other terms of the franchise remaining the same, without having to go through the, at times, time-consuming and lengthy procedure for obtaining prior approval from the Department for Transport?

[Earl Attlee]

I think that the noble Lord broadly describes some of the difficulties of franchising. We will have to see what the result of the consultation is.

Aviation: UK Civil Aviation

Lord Rosser Excerpts

Monday 23rd January 2012 Lords Chamber

[Lord Rosser]

My Lords, I also extend my thanks to my noble friend Lady Gibson of Market Rasen for securing this all too brief debate on the future of our civil aviation industry, a subject which has been thrust back into the limelight by the Government’s announcement of a consultation looking at options for maintaining the UK’s aviation hub status, including the possibility of a major new hub airport in the Thames estuary.

It is an interesting announcement, since, assuming its birth was not related to the forthcoming London mayoral election campaign, it represents a considerable potential U-turn from previous statements of no new runways at any of the three largest airports in London and the south-east, and a lack of enthusiasm for an airport in the Thames estuary. The Government’s failure to set out a strategy for aviation which addresses capacity issues, among other things, is now putting jobs and growth at risk. The Government’s call for airports to be “better not bigger” is a slogan, not a policy. The Government have no established policy around the future of the UK’s civil aviation sector beyond a statement in the coalition agreement that the Government will refuse permission for new runways to be built at Heathrow, Gatwick and Stansted. Perhaps the Minister could tell us when he responds whether, in the light of the consultation just announced, that is still the Government’s policy or not.

What we need is a strategy that works for the south-east as well as for our network of regional airports which are so crucial to our economy. The Government should have accepted our offer to work together on a cross-party basis to agree a long-term strategy for aviation. Setting an agreed long-term strategic direction for aviation is vital, particularly bearing in mind that our hub airport, Heathrow, is already working to virtually maximum capacity, that we are falling further behind our EU competitors, passenger numbers are projected to grow significantly, the industry needs to be able to plan with certainty for the future—not least to deliver investment to provide additional capacity—and the UK has 11 per cent of Europe’s airspace and 25 per cent of its traffic.

Any new capacity must go hand in hand with tougher targets on reducing CO₂ emissions from aviation to tackle the industry’s contribution to climate change. The industry can be proud of the huge advances that have been made in this direction already. However, with the significant growth in air passenger numbers forecast, we will not achieve, by 2050, the broader 80 per cent cut in emissions on 1990 levels to which we committed in the Climate Change Act 2008 without aviation playing a greater role. Future aviation growth must, we believe, go hand in hand with a greater cut in aviation emissions than we agreed, when in government, of reducing to below 2005 levels by 2050, a target to which the present Government have not affirmed their commitment. The industry’s own sustainable aviation road map makes clear that, by 2050, it is possible to get absolute levels of emissions down to levels seen at the turn of the century, even as passenger numbers are projected to grow very significantly, so there seems to be a measure of agreement that it is possible to do more.

The aviation industry contributes more than £11 billion to the UK’s gross domestic product. It supports up to 200,000 jobs directly and up to 600,000 indirectly across the UK. It is deeply worrying to the industry and the business world, among others, that while we know what the Government are against, there is still no credible strategy for aviation even on the horizon, which sets out the approach that this Government favour.

--- Later in debate ---

[Earl Attlee]

Secondly, this Government have an open mind, which is the right way to go into a consultation. The noble Baroness, Lady McIntosh of Hudnall, effectively asked whether we are going to do a U-turn on Stansted. The commitment in the coalition agreement still stands.

[Lord Rosser]

In the light of what he said about the Government having an open mind, will the noble Earl confirm that the previous government statements about no new runways at any of the three largest airports in London and the south-east no longer stand?

[Earl Attlee]

Definitely not, my Lords. The noble Lords knows perfectly well that that is in the coalition agreement and will stay.

The noble Lord, Lord Monks, asked me what more can be done to support industry and its people. The Government recognise the value that the aviation industry brings through supporting a network of highly skilled workers that adds value to the economy. The sector is at the forefront of technological progress, delivering R&D projects and large-scale investments that drive industry and the economy forwards. It is important that the trade union sector fully engages in the consultation process. The noble Lord also touched on the important issue of pilot fatigue. On the matter of flight-time limitations, we will support the proposed requirements only if the Civil Aviation Authority determines that they provide an appropriate level of protection against crew fatigue.

The noble Lord, Lord Soley, touched on the 76,000 employees at Heathrow, plus those in related service industries. We have to take their position into consideration as well. The noble Lord also talked about biofuels. The Government are clear that sustainable biofuels have a role to play in reducing CO₂ emissions from transport, particularly in sectors such as aviation where there are limited alternatives to fossil fuels. In recent years, the aviation industry has conducted research and carried out flight tests to help provide information on different fuels. This work has demonstrated that biofuels for aviation are technically feasible. However, there are currently a range of barriers to introducing biofuels, including sustainability, scalability of the feed stocks and commercial viability. The Government will continue to work with European partners, the wider international community and industry to explore how to bring about a significant increase in the use of biofuels in aviation. Advanced biofuels, such as those derived from algae, when commercialised, could offer particular advantages, such as reduced land use impact.

On UK connectivity with China, the Government recognise the importance of developing and maintaining good links between the UK and emerging economies. That is why this March we are calling for evidence on options for maintaining the UK's hub status. Heathrow currently has fewer scheduled flights to mainland China than Paris or Frankfurt, but more than Amsterdam. However, if flights from Heathrow to Hong Kong are included, there are more flights from Heathrow to China than from any other EU hub. Hong Kong serves around 45 destinations on the Chinese mainland.

The noble Lord, Lord Empey, raised the issue of connectivity with the regions, particularly Northern Ireland. The Government recognise the vital contribution that air connections make to regional economies and acknowledge Northern Ireland's concerns about the air service between Northern Ireland and Heathrow should BMI be sold to British Airways. However, airlines operate in a competitive commercial environment, and it is for individual airlines to determine the routes that they operate. The options for supporting regional air services to London are limited. Member states can impose public service obligations to protect air services to remote airports, which could permit slots to be ring-fenced. However, they can be imposed only between specific cities, not specific airports, a difficulty identified by the noble Lord, Lord Empey. We have written to the EU Commission on that point, but there is no other mechanism for the Government to intervene in the allocation of slots at UK airports. The noble Lord introduced the Airports (Amendment) Bill, which would provide for the protection of air services between Heathrow and the UK regions. The Government are considering in detail the measures included in the Bill.

The noble Lord, Lord Lea, got quite excited about a number of points. Although we are committed to not authorising additional runways at Heathrow, Gatwick and Stansted, we are looking at our aviation policy framework with an open mind. The aviation industry is vital to our country. Our next step is to publish the draft aviation strategy and call in March for evidence on hub connectivity. With that strategy, we want to move away from the polarised opinions that have dominated discussion in the past and develop a broader consensus for change.