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Introduction
1. In September 2012 the Coalition Government set up the Airports Commission to examine the scale and timing of any requirement for additional capacity to maintain the UK's position as Europe's most important aviation hub, and identify and evaluate how any need for additional capacity should be met in the short, medium and long term.
2. Sir Howard Davies was appointed to chair the Commission, which was required to produce:
• an Interim Report by the end of 2013, assessing the evidence on the nature, scale, and timing of steps needed to maintain the UK’s status as an international hub for aviation; and to make recommendations for the better use of current runway capacity consistent with credible long term options; and
• a Final Report by summer 2015, giving its assessment of the options for meeting the UK's international connectivity needs, including their economic, social and environmental impact; its recommendations for the optimum approach to meeting any needs; and its recommendations for ensuring that the need is met as expeditiously as practicable within the required timescale.
3. The Commission’s Final Report was published in July 2015. It was a substantial piece of work that took nearly three years to complete. Given the scale of the exercise undertaken by the Commission, the body of evidence and analysis produced is an important contribution to the Government's considerations in respect of future airport capacity in the UK. However it is necessary for the Department to review the appropriateness of the Airports Commission's evidence base and of its assessment of that evidence base to inform any Government decision on how to proceed, and to identify whether any areas of that work may need to be assessed by the Government in further detail.
4. This document explains the review undertaken by the Department for Transport of the work of the Commission and sets out the Department’s findings to the extent that they might affect the fitness of that work to inform a relevant Government decision on airport capacity expansion.
Objectives and scope of the review
5. The objectives of the review were to:
• analyse the relevant Airports Commission Reports and their supporting evidence and analysis;
• raise points of clarification with the Commission where appropriate; • clearly understand the basis on which the Commission reached its conclusions; and
• inform a Senior Review Panel of its findings.
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6. In order to meet its objectives, the review focussed on developing an assessment of the Commission's key findings. The following standard of review was adopted:
• assess the degree to which the Airports Commission's work aligns with the
Terms of Reference specified by the Government;
• consider and identify whether there are any apparent or potential gaps in the evidence developed and considered by the Commission;
• highlight any areas in which a recommendation of the Commission potentially deviates from current Government policy; and
• document where the implementation of the Commission's recommendations requires implementing action by Government or others.
7. The review was limited to the information contained within the published work of the
Airports Commission. It did not consider evidence, representations or views made by others about future airport capacity needs except to the extent that they are reflected in the Commission’s Reports.
8. The scope of the review also did not include drawing any conclusion about the weight to be given to the Commission's recommendations in any future Government consideration of airport capacity or about the relative weight which the Commission gave to different pieces of the evidence it considered or to the assessment modules making up its appraisal framework. It was not intended to reassess or repeat the work of the Commission.
9. To fully understand the Commission's conclusions, the review included both the Final
Report and the relevant sections of the Interim Report, which were those that fed directly into the Airports Commission's long-term capacity recommendations. Assessments of material in the Interim Report are integrated below under the relevant chapter headings from the Final Report.
10.The Interim Report includes recommendations for making best use of existing airport capacity in the short and medium term. In particular it makes a set of recommendations on improving surface access to airports with spare capacity to make these airports more attractive to airlines and passengers. These recommendations are outside the scope of the review as they were designed to stand alone from any future decision on airport capacity expansion.
11.Subsequent to the Interim Report, the Airports Commission conducted further analysis on the proposal for an Inner Thames Estuary Airport and published their conclusions in September 20141. This work has been reviewed for consistency with the Airports Commission's Terms of Reference and their own shortlisting procedure. This review is set out at Annex A.
1 Available at https://www.gov.uk/government/publications?departments%5B%5D=airports-commission
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The review process
12.A detailed explanation of the review process, including preliminary work, clarification procedure, governance and assurance, and the steps taken to ensure propriety and transparency, is set out at Annex B.
How this Report is set out
13.This Report is intended primarily to identify issues which might affect the fitness of the
Airports Commission’s Report to inform relevant Government decisions on airport capacity expansion. Accordingly, it considers whether the Commission’s findings were reasonable or appropriate to the current stage of policy development.
14.In the sections which follow the Summary of Findings below, each Chapter of the
Airports Commission's Final Report is described briefly, along with a description of any part of the Interim Report relevant to the same subject matter. These descriptions are followed with the review assessment. The same approach is taken in Annex A to the Commission's analysis of the Inner Thames Estuary proposal.
15.The Chapters are grouped as follows:
• Chapters 1-3, which establish the context and consider the case for change; • Chapters 4 and 5, which set the scene for the Commission’s appraisal of shortlisted proposals, explain the establishment of its appraisal framework and summarise the schemes undergoing appraisal;
• Chapters 6-12, which consider the shortlisted proposals against the appraisal framework;
• Chapter 13, which sets out the Commission’s recommended option for expansion and a package of measures to address its impact on the local environment and communities;
• Chapters 14-16, which explain its recommended package of measures and offer advice to the Government arising from the Commission’s work and conclusions.
16.It is assumed in this Report that the reader has read the Commission’s Interim and
Final Reports2. References to “the Department” are references to the Department for Transport and references to “WebTAG” are references to the Department’s Transport Appraisal Guidance3. References to the ITF are to the International Transport Forum.
Summary of findings
17.The review’s key findings were as follows:
• the Department is satisfied that the Airports Commission complied with its
Terms of Reference.
2 Available at https://www.gov.uk/government/publications?departments%5B%5D=airports-commission 3 Available at https://www.gov.uk/guidance/transport-analysis-guidance-webtag
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• the Department is satisfied that the evidence examined by the Commission was appropriate and sufficient to allow it to reach its conclusion and make its recommendations. Some issues with evidence relied on by the Commission were identified and these are discussed in the text. The Department is satisfied that these points do not affect the validity of the Commission’s conclusions or recommendations, for reasons which are explained below, and that the Commission’s evidence base is therefore robust.
• the Department is satisfied that the Commission has interpreted its evidence in an appropriate manner and that its conclusions and recommendations are therefore sound. Some limited issues with the Commission’s use of evidence have been identified. The Department is satisfied that these do not affect the validity of the Commission’s conclusions or recommendations, for reasons which are explained below, and that the Commission’s use of evidence is therefore robust.
• the Department also notes that if the Government decided to follow the
Commission’s recommendations, many areas of policy require further development, including the collection and analysis of further evidence and the consideration of a number of issues of law. This is recognised by the Commission and the Department is satisfied that the Commission has considered these issues to an appropriate level of detail for the purposes of its Terms of Reference and to enable it to reach its conclusions and make its recommendations.
18.The Department is therefore satisfied that the Airports Commission’s Final Report is a sound and robust piece of evidence on which the Government can base decisions as to whether further airport capacity is required and as to where that capacity would best be located.
19.The Department notes however that the Commission’s conclusions and recommendations reflect its views of the relative weighting to be given to different pieces of evidence and to the different assessment modules making up its appraisal framework. There is a range of reasonable views which might be taken on these matters.
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1. Review of Chapters 1 to 3 of the Airports
Commission’s Final Report
20.Chapters 1 to 3 of the Airports Commission’s Final Report establishes the context for its work and considers the case for change. The review below explains the content of each chapter in turn before giving the Department’s assessment.
Chapter 1 (Introduction)
21.Chapter 1 sets out the historical context and the Terms of Reference that the Airports
Commission were given by the Government4. It describes the creation of the Commission and the way in which its work is intended to help the Government plan future airport capacity. It summarises the way in which the Commission carried out its analysis, the factors it considered, and the range of evidence it received and considered.
22.The chapter also describes the steps taken by the Commission to make the process as fair and as transparent as possible such as publishing information on its website, and consulting and inviting responses from the public and interested parties. It includes a summary of the Interim Report’s recommendations5.
Chapter 2 (The global and national context for the Commission’s work)
23.Chapter 2 provides an overview of the Commission’s analysis of recent developments in the global aviation sector. This is used as the starting point for the assessment of the UK’s future aviation capacity needs.
24.The chapter looks at the way in which the aviation sector has evolved on a global scale since the last major review of UK airport policy, including the strengths and weaknesses of UK airports and the connectivity they support. It describes two trends, the first for consolidation, partnership and network integration and the second for new entrants, enhanced competition and point to point travel. It notes that some of the industry growth areas were not predicted, and that there are uncertainties and disagreement about the way in which the aviation sector might develop in the future.
Chapter 3 (The case for change)
25.Chapter 3 presents the Airports Commission’s analysis of the importance of aviation capacity to the UK economy and of the costs of the current capacity constraints to the
4 The Commission’s Terms of Reference are set out at paragraph 1.5 of the Final Report. 5 Final Report pages 40-41.
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UK’s residents and businesses. It provides an overview of the Commission’s assessment in its Interim Report that the only way effectively to tackle these challenges is through building one net additional runway in the South East by 2030.
26.The Chapter also sets out the process by which the shortlist of three proposals for expansion was reached (a new Northwest Runway at Heathrow, an Extended Northern Runway at Heathrow and a Second Runway at Gatwick). The Commission notes that at the time of its Interim Report, it did not have sufficient evidence on which to base a decision as to whether the proposal for a new Inner Thames Estuary Airport was credible and it therefore carried out further studies and consultation before concluding that the option should not be added to the shortlist6.
Assessment of Chapters 1 to 3
27.The work presented by the Airports Commission is consistent with its Terms of
Reference.
28.The Commission presents a significant amount of factual information and in the
Department’s view, the evidence is thorough and robust and the arguments are logical. The explanation of the short-listing process and subsequent decisions are clear, well-argued and evidenced, and consistent with the published sift criteria. The Department has found no gaps or inconsistencies in the explanations provided and the analysis is fair and thorough.
29.The explanations for rejection of schemes are consistent with the Commission's remit as per its Terms of Reference to identify the credible long-term options which merit further detailed development.
30.The evidence in the Case for Change is based on empirical analysis of connectivity trends over the past 15 years. The Aviation model, originally Department for Transport owned but further developed by the Commission, was used to compare an unconstrained demand scenario to the “do minimum” to estimate the direct passenger impacts of restricted capacity in the future. The approach on direct passenger benefits is robust. For the wider impacts the Airports Commission used two different Spatial, General Equilibrium economic models (S-CGE) to reflect the difficulty and uncertainty of estimating these impacts. These estimate economic impacts of additional or constrained capacity across the whole economy, taking into account interactions across sectors over time. There are reservations about the use of the S- CGE model, which are recognised by the Commission7. The Department is satisfied that the approach taken of using different methodologies and tools is appropriate.
31.The Interim Report used five assessment scenarios8. The Airports Commission presents a report by the International Transport Forum (ITF) to justify its use of one of these, Assessment of Need, as the core scenario used for assessment, although
6 Final Report, paragraph 70. The Commission summarises its further consideration of the Inner Thames Estuary proposal at pages 87- 88. See also Annex A to this review. 7 Final Report, paragraphs 6.31-6.32 8 The scenarios are summarised in Chapter 6 of the Final Report at, page 107.
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conclusions are tested against the other scenarios given future uncertainty. The Department is satisfied that this approach was appropriate. The scenarios were tested under two sets of demand forecasts derived from approaches to methods of managing CO2 emissions: carbon-traded and carbon-capped, the latter in line with the Commission on Climate Change’s planning assumption of restricting aviation emissions in 2050. Assessing the case for expansion using both sets of forecasts was a robust approach and demonstrated that aviation demand would still outstrip available capacity even in the lower demand, carbon-capped scenario.
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2. Review of Chapters 4 and 5 of the Airports
Commission’s Final Report
32.Chapters 4 and 5 of the Airports Commission’s Final Report set the scene for the
Commission’s appraisal of short-listed proposals, explain the establishment of its appraisal framework and summarise the schemes undergoing appraisal.
Chapter 4 (The Commission’s appraisal and consultation process)
33.Chapter 4 describes the development of the Airports Commission’s appraisal framework and the criteria that it used for evaluating scheme proposals. It also explains that the Commission consulted on the development of the framework and further mentions their use of a Sustainability Reference Group. The Commission's final appraisal framework was published in April 2014 with an explanation of the changes it had made following the consultation9.
34.The chapter also outlines the way the Airports Commission engaged with and consulted stakeholders in its process. It describes the development of some of its discussion papers and the formal public consultation processes that it carried out, including the questions it asked in the consultation on the three shortlisted schemes. It further discusses some of the specific engagement it carried out and how it analysed consultation responses. It discusses briefly its consultation on air quality issues and how the Commission’s work has been informed by the Strategic Environment Assessment Directive.
Chapter 5 (The short-listed schemes)
35.Chapter 5 outlines the three schemes on the Airports Commission's shortlist. It mostly describes the features of the schemes as put forward by the promoters, but for Gatwick highlights a change to phasing that was put forward by the airport after the Airports Commission flagged up a concern in its consultation. The Commission assessed its view of the schemes’ designs, informed by the promoters’ submissions and often adopting the same approach as the relevant promoter but in some areas adapting their designs.
Assessment of Chapters 4 and 5
36.The appraisal framework developed by the Airports Commission to assess and shortlist schemes is consistent with its Terms of Reference.
37.The Terms of Reference specified that the Commission should take into account a number of criteria in the assessment to develop a broad evidence base of the impacts of each scheme and should engage widely to gather views from interested and
9 The appraisal framework objectives are set out at pages 91-92 of the Final Report. The Commission’s publications can be found at https://www.gov.uk/government/publications?departments%5B%5D=airports-commission
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affected parties. The appraisal framework developed, and consulted on, clearly captures a wide range of impacts with which to assess schemes, and the Commission has fulfilled its remit to consult widely throughout the process.
38.The Commission’s explanation of the short-listing process and its subsequent decisions is clear, well-argued and evidenced, and consistent with the published sift criteria. The Department has found no gaps or inconsistencies in the explanations provided and the analysis is fair and thorough. The explanations for rejection of schemes is consistent with the Commission’s remit in its Terms of Reference to identify the credible long-term options which merit further detailed development.
39.It is noted that the short-listed schemes proposed by the promoters vary in some respects from the schemes considered by the Commission. These areas have been separately identified as part of the Department’s engagement with the short-listed promoters following publication of the Final Report. The Department is satisfied that the differences identified do not affect the validity of the Commission’s shortlist.
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3. Review of Chapters 6 to 12 of the Airport’s
Commission’s Final Report
40.Chapters 6-12 of the Airports Commission’s Final Report appraise the short-listed schemes against the Commission’s appraisal framework10. Each Chapter deals with one appraisal criterion and the associated appraisal objectives, other than Chapter 11 which covers two criteria. The criteria are: strategic fit; economy; surface access; environment; people; cost; delivery; and operational viability.
Content of Chapter 6 (Strategic Fit)
41.Chapter 6 assesses how each of the short-listed schemes performs against the appraisal objectives relating to strategic fit. These were:
• to provide additional capacity that facilitates connectivity in line with the assessment of need;
• to improve the experience of passengers and other users of aviation; • to maximise the benefits of competition to aviation users and the broader economy; and,
• to maximise benefits in line with relevant long-term strategies for economic and spatial development.
42.The Commission’s terms of reference required it to carry out “a review of the evidence in relation to the current position in the UK with regard to aviation demand and connectivity, forecasts for how likely these are to develop, and the expected future pattern of the UK’s requirements for international and domestic connectivity.” The findings of that review formed the assessment of need set out in the Interim Report.
43.The conclusion of the Interim Report was that capacity equal to one net additional runway would be needed in south east England by 2030, and that the optimal solution would be to continue to invest in an airport system which can cater for a range of airline business models, enabling it to adapt to the future needs of residents and businesses in the UK and not be predicated on a single view of the industry.
44.In the Commission’s view, the additional capacity provided would ensure that the UK continued to benefit from strong international connectivity; in particular through routes to emerging markets, which are likely to be increasingly important for the country’s economic prosperity. This connectivity should also be produced in an airport system that supports a competitive market and effectively meets the needs of passengers and other users of aviation.
45.The Commission’s strategic fit appraisal module is intended to assess how effectively the short-listed options deliver against those goals. It also considers the benefits of each option for the air freight sector, which in the Commission’s view plays an important role in the UK economy and can also be the deciding factor that makes a
10 The appraisal framework is set out at pages 91-92 of the Final Report.
