Leaving the EU: Aviation Sector

Paul Maynard Excerpts

Friday 25th November 2016 Commons Chamber

[The Parliamentary Under-Secretary of State for Transport (Paul Maynard)]

It is a pleasure to be here today. I congratulate the hon. Member for Luton South (Mr Shuker) on securing this debate and on speaking so passionately and strongly on behalf of Luton airport, which is in his constituency. This is a particular pleasure because we started our parliamentary careers together on the Transport Committee and here we are today discussing transport almost seven years on.

Let me start by reiterating the Prime Minister’s views on the issue. She made it clear that Members of this House will have the opportunity thoroughly to discuss how we leave the EU, and in a way that respects the decision taken by the people on 23 June. This debate is an important part of that process, as was the opportunity the House had to discuss the implications of Brexit for transport on Wednesday, when many of the themes to which the hon. Gentleman referred came up. It is also important to realise that aviation is one of the Secretary of State’s top priorities and will play a huge role in fulfilling our wider aspirations around leaving the EU: being stronger and more ambitious as a country and more outward looking and open for business. Aviation will play an even more important role in strengthening existing links with countries near and far and in building fresh links across the world.

As the hon. Gentleman pointed out, our aviation industry is world class. It underpins the UK economy and international trade. Our airports, including Luton, are our gateways to the world. We are a big global player. We have the largest aviation network in Europe and the third largest in the world. In 2015, goods worth £155 billion were shipped by air between the UK and non-EU countries—over 40% of the UK’s extra-EU trade by value. The UK’s location and extensive aviation network make us an attractive location for global business. Some 73% of visitors to the UK come here by air. The aviation sector is a significant industrial actor in its own right, directly contributing around £20 billion to the economy in 2014, including the wider aerospace sector. The CBI rightly points out that, if the UK retains its aviation market share, air traffic growth in Asia alone will create an extra £4.7 billion in exports over the next 10 years and 20,000 high-value jobs.

As the hon. Gentleman knows, we have taken the significant decision to support a new north-west runway at Heathrow, which is a clear sign of the importance that the Government place on the aviation sector and of our commitment to improving global connections. With room for an extra 260,000 aircraft movements a year, the new runway will deliver more flights, more destinations and more growth. The benefits to passengers and the economy will be worth up to £61 billion. It will bring more business and tourism to Britain and offer more long-haul flights to new markets. By expanding Heathrow, we will show that we are open for business, confident about who we are as a country and ready to trade with the rest of the world. It will also provide a key hub for connections across the UK, improving domestic connectivity, but there is more to the story than Heathrow.

In October, we announced the go-ahead for a brand new £344 million expansion programme at London City airport. That, too, will increase connections within the UK and Europe, and support business opportunities and investment, as well as improving passengers’ journeys. Furthermore, regional airports such as Manchester and Bristol have each been spending £1 billion on improvements for passengers, with the Government supporting surface transport connectivity on road and rail around those airports. Then there is Newcastle, with a £14 million redevelopment of its departure lounge, transforming facilities for passengers before they take off on their journeys.

Last month, my noble Friend Lord Ahmad, the aviation Minister, signed a deal with China that will more than double the number of flights able to operate between our two countries, boosting trade and tourism. He was also recently in Manchester, welcoming Singapore Airlines to the city—the airline is operating its first connecting route to Manchester and onwards to Houston, Texas.

Looking wider than aviation for a moment, there are also extremely positive signs for investment in the wider transport industry in the UK. Since the referendum, we have seen several major companies announce major investments. In August, Bombardier in Derby received an order for 665 new pieces of rolling stock, delivered for Greater Anglia, which is great news for jobs and skills in the east midlands—as rail Minister, that gives me particular pleasure. Siemens, too, has committed itself to railway rolling stock manufacturing in the UK, as has Spain’s tram manufacturer CAF. In addition, Hitachi Rail’s new rolling stock manufacturing and assembly plant in Newton Aycliffe will create 730 new jobs. We also have Nissan’s commitment to investment, which is great news for not just the north-east but the British economy and the automotive sector as a whole.

I can understand that the referendum outcome has caused some uncertainty in the aviation industry, but the future of aviation does look bright for the UK. By expanding Heathrow, we will open up new opportunities at airports throughout the country. We should be incredibly proud of our UK airlines; they are among the best and most innovative in the world. More people fly with British airlines each year than fly with carriers from any other country, outside the US and China.

Other countries want to do business with us, our airlines and our airports, and I do not believe that that will change after we have left the EU. We must not lose sight of the momentous opportunities there will be for aviation. Aviation remains the top priority for the Department for Transport in the negotiations that will now ensue.

We are working hard across Government to ensure that our exit strategy addresses the priorities of the aviation industry. To do that we have been engaging proactively with our aviation industry to fully understand its views. Just last week, Lord Ahmad and the Secretary of State for Exiting the European Union had a very constructive roundtable with the aviation industry, including senior representatives from airports, airlines, industry bodies and regulators. That was part of a series of roundtables to allow our industry to express its views directly to Ministers and to discuss the risks, but also the opportunities, that Brexit has created.

We have released a joint statement with Airlines UK that reinforces just how important the aviation sector is in the upcoming negotiations—a point reiterated by the Secretary of State for Transport when he attended and spoke at the Airport Operators Association conference earlier this week. We remain focused on securing the right arrangements for the future, including with Europe, so that our airlines can continue to thrive and so that passengers will continue to have opportunities, choice and attractive prices.

Other areas of critical importance are the efficient regulation of safety, security measures and a seamless air traffic management system. We are considering the implications for our continued participation in the European Aviation Safety Agency system, to which the hon. Gentleman referred, and the single European sky. However, until we leave the EU, it is worth bearing in mind that EU law will continue to apply, alongside national rules.

Leaving the EU will give us more freedom to make our own aviation agreements with other countries far beyond Europe. It is vital that we seek to quickly replace or amend our EU agreements with countries such as the US and Canada. The Secretary of State for Transport has already held positive discussions with his counterpart in the US, and the aviation Minister has met numerous airlines that already operate into the UK from outside the EU. We are confident of reaching an early agreement and we will continue to engage with the industry on those issues throughout the coming months.

Alongside our preparations for Brexit, we are developing a national aviation strategy to address industrial concerns. The strategy will seek to champion the benefits that the third largest aviation market in the world already brings to this country. It is a long-term framework, covering airports, safety, security, competitiveness, consumers, regulation and capacity, and it will help to maximise the opportunities presented by our exit from the EU, along with the benefits of emerging technologies. Although it is at an early stage, we will look to have full, frank and constructive engagement with the industry and other partners in the aviation sector.

As Members know, the Government are not going to give a running commentary on aviation negotiations with our European partners, however tempting that prospect might occasionally be to Opposition Members. I can assure the House, however, that our negotiating position will be informed by our continued engagement with the aviation sector, as well as with colleagues who have an interest in it. The hon. Member for Luton South said that aviation has always been treated differently in such negotiations, and I see no reason for that to change in the immediate future. I assure him and the House that the views of all Members will be taken very seriously—not just on aviation, but across all sectors—for ultimately we are working hard to achieve the best possible outcome for our aviation industry and for Britain as a whole.

Question put and agreed to.