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An Air Transport Strategy for Northern Ireland

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An Air Transport Strategy for Northern Ireland House of Commons Northern Ireland Affairs Committee An air transport strategy for Northern Ireland First Report of Session 2012–13 HC 76 House of Commons Northern Ireland Affairs Committee An air transport strategy for Northern Ireland First Report of Session 2012–13 Report, together with formal minutes, oral and written evidence Ordered by the House of Commons to be printed 22 November 2012 HC 76 [Incorporating HC 1941-i, Session 2010-12] Published on 30 November 2012 by authority of the House of Commons London: The Stationery Office Limited £0.00 Northern Ireland Affairs Committee The Northern Ireland Affairs Committee is appointed by the House of Commons to examine the expenditure, administration, and policy of the Northern Ireland Office (but excluding individual cases and advice given by the Crown Solicitor); and other matters within the responsibilities of the Secretary of State for Northern Ireland (but excluding the expenditure, administration and policy of the Office of the Director of Public Prosecutions, Northern Ireland and the drafting of legislation by the Office of the Legislative Counsel). Current membership Mr Laurence Robertson MP (Conservative, Tewkesbury) (Chair) Mr David Anderson MP (Labour, Blaydon) Mr Joe Benton MP (Labour, Bootle) Oliver Colvile MP (Conservative, Plymouth, Sutton and Devonport) Mr Stephen Hepburn MP (Labour, Jarrow) Lady Hermon MP (Independent, North Down) Kate Hoey MP (Labour, Vauxhall) Naomi Long MP (Alliance, Belfast East) Jack Lopresti MP (Conservative, Filton and Bradley Stoke) Dr Alasdair McDonnell MP (SDLP, Belfast South) Nigel Mills MP (Conservative, Amber Valley) Ian Paisley MP (DUP, North Antrim) Andrew Percy MP (Conservative, Brigg and Goole) David Simpson MP (DUP, Upper Bann) The following Member was also a member of the Committee during the inquiry. Kris Hopkins MP (Conservative, Keighley) Powers The committee is one of the departmental select committees, the powers of which are set out in House of Commons Standing Orders, principally in SO No. 152. These are available on the Internet via www.parliament.uk. Publication The Reports and evidence of the Committee are published by The Stationery Office by Order of the House. All publications of the Committee (including press notices) are on the Internet at www.parliament.uk/niacom. Current Committee staff The current staff of the Committee are Mike Clark (Clerk), Duma Langton (Inquiry Manager), Edward Faulkner (Senior Committee Assistant), Ravi Abhayaratne (Committee Support Assistant) and Jessica Bridges-Palmer (Media Officer). Contacts All correspondence should be addressed to the Clerk of the Northern Ireland Affairs Committee, House of Commons, 7 Millbank, London SW1P 3JA. The telephone number for general enquiries is 020 7219 2173; the Committee’s email address is [email protected]. An air transport strategy for Northern Ireland 1 Contents Report Page Summary 3 1 Introduction 5 2 Background 6 3 Connecting for growth 7 4 International Airlines Group’s takeover of bmi 10 5 Northern Ireland’s airports in the future 12 6 Transport links to Northern Ireland’s airports 14 7 Tax policy 16 8 The visa regime 17 9 The Civil Aviation Bill 19 Conclusions and recommendations 21 Annex 1 23 Public Service Obligations (PSOs) 23 Annex 2 24 The Irish Short-stay Visa Waiver Programme 24 Annex 3 25 The Schengen agreement 25 Formal Minutes 26 Witnesses 27 List of printed written evidence 28 List of Reports from the Committee during the current Parliament 29 An air transport strategy for Northern Ireland 3 Summary For the people of Northern Ireland air travel is not a luxury, it is fundamental to family and economic life. To facilitate the rebalancing of the Northern Ireland economy, it is vital that the Region’s air links to Great Britain, mainland Europe and the rest of the world are robust. There are, however, several hurdles to overcome, which we have identified in this Report. Air Passenger Duty—despite the Air Passenger Duty (APD) on direct long-haul flights being reduced to zero, this does not assist the 98.5 per cent of passengers who travel from NI airports on short haul flights. HM Treasury and the Northern Ireland Executive must explore ways to reduce or, preferably, abolish APD on all flights into NI from GB and on all direct flights from Northern Ireland to any destination. Connectivity—air links to hub airports, particularly Heathrow, must be, at least, maintained at the current level, and further routes should be actively sought. The Northern Ireland Office and the Department for Transport must vigorously pursue their discussions with the European Commission regarding the ring fencing of slots at Heathrow for flights to and from Northern Ireland. Airports Commission review—we welcome the review being carried out by the Airports Commission into options to maintain the UK’s status as an international hub for aviation. However, the Commission is not due to report until 2015 and delay as to the future airport configuration and capacity in the South East of England is causing concern among the business community in Northern Ireland. We urge the Government to expedite the review, and the consequential decision, as soon as possible given its importance to Northern Ireland’s international connectivity. Internal access to Northern Ireland’s airports—road and rail links to all three of NI’s airports must be improved. Visas—the UK and the Irish Governments should co-operate fully in order to introduce a joint, shared visit visa for the UK and the Republic of Ireland, as the current cost of two visas deters both business and leisure travellers from visiting both jurisdictions on a single visit. An air transport strategy for Northern Ireland 5 1 Introduction 1. On 5 July 2011, the Northern Ireland Affairs Committee published its Second Report of Session 2010–12, Air Passenger Duty: implications for Northern Ireland.1 We had little doubt that Air Passenger Duty (APD) threatened the improvement of Northern Ireland’s economy and, in our Report, we called for the abolition of APD on all flights out of Northern Ireland airports and on flights from Great Britain into Northern Ireland. A major consideration at the time was the need to maintain the Continental Airlines (now United Airlines) transatlantic route from Northern Ireland to Newark in the United States of America, which was under threat; the airline was, in effect, subsidising its passengers by not passing on the cost of APD to them, but was absorbing the cost itself. The airline had indicated that it was no longer in a position to be able to do so. 2. HM Treasury was persuaded by the Committee’s arguments, and those of other campaigners, and in a Written Ministerial Statement made on 18 October 2011,2 agreed to cut the rate of APD on the Belfast to Newark route to the UK domestic flight rate of £12 (since increased to £13) per passenger, from £60 (now £65)3 per passenger, the standard rate of APD for flights to North America. In a further Statement, made on 21 February 2012,4 HM Treasury announced that the power to set APD rates for direct long-haul flights from NI would be devolved to the NI Assembly; this provision was included in the Finance Act 2012. 3. Welcome as these actions by HM Government were, the Committee remained concerned that APD was adversely affecting Northern Ireland’s economy and travellers. If people wish to travel from NI to GB, without spending many hours travelling, there is no realistic option other than to fly. We agreed, therefore, that we would revisit the issue as part of a wider inquiry into air transport in NI. On 23 March 2012, we announced an inquiry into An air transport strategy for Northern Ireland with the following terms of reference: • the implications of current air links for Northern Ireland, specifically the economy and the effect on people’s social and family lives; • regional and international connectivity; • the lack of public transport links to, and between, Belfast International, Belfast City and City of Derry airports; • the implications for Northern Ireland of the Civil Aviation Bill; 1 Second Report from the Northern Ireland Affairs Committee, Session 2010-12, Air Passenger Duty: implications for Northern Ireland, HC (2010-12) 1227 2 Official Report, 18 October 2011, col. 57WS 3 From 1 April 2013 this rises to £67 per person. 4 Official Report, 21 February 2012, col. 71WS 6 An air transport strategy for Northern Ireland • the implications of the proposed takeover of bmi by the International Airlines Group,5 and • tax policy. 4. During the inquiry, the Committee took public evidence in Parliament Buildings, Stormont, from Belfast International Airport, George Best Belfast City Airport and City of Derry Airport and, at Westminster, from CBI Northern Ireland, ABTA, Unite, the Consumer Council for Northern Ireland, BALPA, the Department for Transport, the UK Border Agency, the Northern Ireland Executive Departments of Enterprise, Trade and Investment and for Regional Development, the International Airlines Group, Ryanair, easyJet, Belfast City Airport Watch, the Federation of Small Businesses and the Northern Ireland Independent Retail Trade Association. We also took the opportunity to raise the matter with the new Secretary of State, when the Rt Hon Theresa Villiers MP gave evidence on the Responsibilities of the Secretary of State for Northern Ireland. We are grateful to all those who gave oral evidence and to those submitting written evidence. 2 Background 5. Northern Ireland is served by three airports: Belfast International Airport, George Best Belfast City Airport and City of Derry Airport (CODA). Belfast International, situated at Aldergrove, about 20 miles from the centre of Belfast, is privately owned and provides a range of services to GB, including Luton, Stansted and Gatwick (with easyJet). It also serves popular holiday destinations as well as Paris, Amsterdam and Newark—the only regular service from NI beyond Europe—and handles all of Northern Ireland’s air freight.
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