Research and analysis

RPC opinion: airspace modernisation – UK Airspace Design Service

Published 12 June 2026

Lead department: Department for Transport

Summary of proposal: to set up the UK Airspace Design Service (UKADS) on a statutory basis, either strengthening the initial UKADS within NATS (En Route) plc (NERL) or creating a new, standalone organisation. This would include the powers necessary to set up the organisation, enforcement of airspace change decisions, and to ensure suitable funding for the UKADS and airspace changes.

Submission type: options assessment

Legislation type: primary legislation

RPC reference: RPC-DFT-25070-OA(1)

Date of issue: 24 October 2025

RPC opinion rating

Fit for purpose:

• the department evidences the problem under consideration
• the OA has considered a long-list of 4 policy options and has used SMART objectives and critical success factors as part of the long-list appraisal
• the OA provides sufficient discussion on impacts, both direct and indirect, as part of the regulatory scorecard

RPC opinion summary

Rationale: Green

The department outlines the problem under consideration. However, the OA could be improved by drawing more explicitly on the industry engagement that has taken place. The OA’s argument for intervention is focused on externalities and information failure. The OA provides suitable objectives, which follow the SMART framework.

Identification of options: Green

The OA draws on earlier policy development for the initial UKADS to present a long-list with 4 policy options. The OA describes options that had been discounted previously and explains why these were not taken forward.

Justification for preferred way forward: Green

The department has monetised the familiarisation costs that will occur at primary legislation stage. The OA includes a qualitative assessment of the non-monetised costs and benefits for both short-listed options.

Regulatory scorecard: Satisfactory

The proposal is expected to have a positive impact on total welfare, but the OA does not present a quantified net present social value (NPSV). The preferred option is expected to have a positive impact on businesses. There are no quantified household impacts in the OA but impacts to consumers have been qualitatively described in the scorecard.

The OA describes several distributional impacts, it is probable that the impacts will be disproportionately experienced in London, the South East and the north of England.

Monitoring and evaluation: Satisfactory

The OA explains that there is an existing monitoring and evaluation plan for the initial UKADS. The department does not commit to a set timeline for completing a post implementation review due to the end-state UKADS being introduced through secondary legislation at a later stage.

Response to initial review

As originally submitted, the OA was not fit for purpose due to insufficient identification of options. The department needed to clarify whether Option 1 constituted a non-regulatory option and needed to demonstrate how the ‘long-list’ of options was produced and how these were narrowed down to a ‘short-list’.

The department has strengthened the OA’s long-list appraisal, which includes previous options considered (as part of an earlier 2024 consultation), why they were discounted and the route map to the current options being considered. The OA is now fit for purpose.

Summary of proposal

Airspace modernisation is a critical part of the UK’s aviation strategy. The current model for airspace change is complex and inefficient. Individual change sponsors oversee the development of their own airspace designs as part of the airspace modernisation process, resulting in each geographic grouping of airports proceeding at the pace of their slowest member.

The current model, as of May 2025, presents a significant risk of coordination failure, delays to airspace modernisation timelines, or that designs will be sub-optimal from a network perspective. This is especially the case for airports in and around London where airspace changes have the potential to deliver the greatest benefits, but where the interdependencies are most complex.

Forthcoming secondary legislation, due to be laid in June 2025, will establish an initial model of a UK Airspace Design Service (UKADS) to deliver airspace change proposals (ACPs) within the London Terminal Control Area region, and potentially any other ACPs deemed a short-term priority.

This “initial UKADS” will be established within an existing third-party organisation, specifically NATS (En Route) plc (NERL). It is expected that other ACPs would continue to be delivered under current arrangements by individual airspace change proposal (ACP) sponsors.

The OA has considered 3 short-list options for intervention:

• option 0 – existing UKADS within NERL - the initial UKADS was designed to deliver short to medium AMS priorities, it is limited in scope and impact to the London region or other high-priority ACPs identified by the co-sponsors
• option 1 – expand scope of initial UKADS - the initial UKADS scope could be expanded to cover more ACPs as directed by the co-sponsors
• option 2 (preferred) – an end-state UKADS supported by primary legislation -establishing an end-state UKADS through primary legislation would enable ACPs to be progressed in a timely manner across the entirety UK

The preferred option is to set up the UKADS on a statutory basis, either strengthening the initial UKADS within NERL or creating a new, standalone organisation. This would include the powers necessary to set up the organisation, enforcement of airspace change decisions, and to ensure suitable funding for the UKADS and airspace changes.

The OA does not present a quantified NPV due to uncertainty in the scope and timing of an end-state UKADS. However, based on previous analysis it is determined that the NPV of the option will be positive.

Establishment of an end-state UKADS will lead to additional familiarisation costs (estimated at £83,521) for ACP sponsors and an increase in present value ACP costs (not quantified). The estimated EANDCB is therefore £0.01 million, which incorporates familiarisation costs resulting from primary legislation only. Additional costs will be outweighed by significant benefits, most notably carbon dioxide emissions savings and fuel expenditure savings.

Rationale

Problem under consideration

The OA outlines the problem under consideration, highlighting that UK airspace is complex and capacity constrained, while the underlying route structure and procedures have not kept pace with technological change and demand patterns. Recent modernisation efforts have progressed unevenly, with interdependent changes requiring coordination across multiple sponsors. These conditions can produce higher transaction costs, longer timelines and inconsistent analytical standards.

The OA also observes that benefits often depend on cross-sponsor alignment, which can be difficult to secure without a convening function. The OA includes case studies to illustrate the delays suffered by ACPs, as well as international examples to support the proposed single organisation. The OA could be improved by drawing more explicitly on the industry engagement that has taken place to further develop the evidence base and support the problem under consideration.

Argument for intervention

The OA’s argument for intervention is focused on externalities and information failure. The department explains that there is an incentive to prioritise benefits to the airport sponsor, rather than opt for designs which may be more beneficial to the overall network. Individual sponsors are also unlikely to have full information on the activities of other sponsors.

The OA also mentions other potential externalities, such as environmental and noise impacts, and the need for optimisation to reduce fuel burn, emissions and delays. The argument could be improved by providing evidence that the effectiveness of a centralised design service exceed those of lighter-touch measures, such as guidance provision and data sharing, as these approaches may be able to address the identified failures more proportionately.

Objectives and theory of change

The OA sets out 2 suitable objectives, which follow the SMART framework. The logic model diagram is fit for purpose but could be improved by developing the ‘impact’ section to consider metrics that could be used to measure these impacts. The logic model could also identify intermediate indicators within the ‘outcomes’ section, such as improved pass rates at each gateway. The department links the intervention to wider government objectives, including economic growth and reducing carbon emissions.

Identification of options

Identification of the ‘long-list’ of options

The OA draws on earlier policy development for the initial UKADS to present a long list with 4 policy options, including a do-nothing option and establishing the initial UKADS as a third-party entity (NERL), through primary legislation or as a new CAA directorate. As a result of the earlier decision to develop an initial UKADS provided by NERL, there were a reduced number of viable options for any successor model.

The OA describes options that had been discounted previously and explains why these were not taken forward. This provides the missing rationale for how options were generated and sifted, addressing our previous concern that the long and shortlists were indistinct.

Consideration of alternatives to regulation

The OA now explicitly explains why non-regulatory alternatives are not viable given the regulated CAP1616 framework and the nature of the coordination failure, for example resolving the balance of responsibilities requires regulatory change. It also clarifies that Option 1 (expanding the initial UKADS) is not a non‑regulatory option: any expansion would operate within the existing statutory framework (with secondary legislation already in force for the initial UKADS and direction by co‑sponsors).

The OA supports this position with evidence from stakeholder engagement and the consultation response document. The OA could benefit from drawing on this stakeholder feedback more explicitly throughout the analysis. The OA links the rejection of alternatives directly to the policy rationale and objectives, in line with the Better Regulation Framework expectation to consider alternatives even at a high level.

Justification for the short-listed options

The OA presents 3 short-listed options, including a do-nothing option, expanding the scope of the initial UKADS and an end-state UKADS. The department details these options in the OA and appraises them against Green Book critical success factors and the policy’s SMART objectives via an options framework filter.

Small and micro business assessment (SaMBA) and medium-sized business (MSB) assessment

The OA provides a sufficient SaMBA that details the number and size of firms impacted. The main identified familiarisation costs will fall predominantly on larger organisations and small, micro and medium-sized businesses will likely see a larger reduction in costs than larger airports, in proportion to what they were paying before.

The department has also considered how the funding mechanism will impact smaller businesses. Therefore, the end-state UKADS would impose a minimal burden on smaller firms. The OA describes how a centrally provided service could compete with existing small consultancies that currently support sponsors. The department states that ‘It has not been deemed feasible to implement any mitigations against this potential impact directly through this proposal’ but would benefit from providing evidence to support this statement.

Justification for preferred way forward

Identifying impacts and scale

In line with RPC guidance, OAs accompanying primary legislation must assess the full policy impacts, including those arising from related secondary legislation. The inclusion of indicative figures from the previous de minimis assessment, alongside a qualitative discussion of costs and benefits, is sufficient to meet the requirements of a Scenario 2 assessment under RPC guidance. The OA has distinguished which impacts stem from the primary legislation, and which are expected to arise from secondary legislation.

Appraisal of the shortlisted options

The OA sets out the methodology behind the familiarisation cost but could benefit from providing some justification for the assumptions used, for example evidencing why familiarisation is expected to take businesses 20 hours. The OA includes a qualitative assessment of the non-monetised costs and benefits for both short-listed options.

The OA could benefit from including a description of the evidence that would be required to monetise these impacts once details of the proposal have been decided at secondary legislation stage.

Selection of the preferred option

The department states that the preferred option would entail the creation of an end state UKADS as a comprehensive UK-wide single design entity. The OA provides a comparison of the initial UKADS and end-state UKADS, highlighting that the bespoke statutory powers of the preferred option would enable the delivery of the policy objectives.

The department has planned to review the success of the initial model and undergo further consultation on detailed proposals prior to introducing secondary legislation, to develop a comprehensive and detailed end-state UKADS policy proposal. Figure 17 provides a comparison between the 2 shortlisted options. This table would benefit from further evidence on the magnitude of each impact, to differentiate between the two options, especially where the impacts are expected to be similar, for example noise impacts and time savings.

Regulatory scorecard

Part A

Total welfare impacts

The proposal is expected to have a positive impact on total welfare, but the OA does not present a quantified NPSV. Familiarisation costs of £83,521 are estimated across a range of existing airspace change sponsor organisations. The estimated EANDCB is £0.01 million, which incorporates familiarisation costs resulting from primary legislation only.

The establishment of the end-state UKADS is not expected to lead to the delivery of ACPs that would not happen in its absence. However, it is expected that it will lead to earlier modernisation of airspace and costs and benefits will therefore be incurred earlier.

Impacts on business

The preferred option is expected to have a positive impact on businesses. It is expected that there will be a marginal increase in costs for businesses as a result of familiarisation, net ACP costs and end-state UKADS set up costs. The department expects these costs to be outweighed by the substantial operational efficiencies that will be realised through modernised airspace, including fuel savings and capacity impacts.

A description of each cost and benefit has been included within the scorecard. The OA should also clarify the classification of direct and indirect impacts in the regulatory scorecard. The fuel use and capacity impacts on businesses have been correctly identified as indirect benefits in the total welfare section of the scorecard, but have been listed as direct benefits in the business section of the scorecard.

Impacts on households, individuals or consumers

There are no quantified household impacts in the OA but impacts to consumers have been qualitatively described in the scorecard. Households will primarily be impacted through the noise impacts of revised flightpaths in lower airspace; however, the net impact will not be known until ACPs are progressed and implemented.

Businesses are expected to pass-through some of their costs to consumers and the OA could benefit from additional evidence on why cost pass through is expected to have a minimal impact.

Distributional impacts

The OA describes several distributional impacts that may occur as a result of the preferred option. Due to the probable scope of the end-state UKADS, any noise impacts brought about by its introduction, whether positive or negative, will be experienced by those working or living in proximity to airports within the London and Manchester cluster.

The preferred option may also have implications for the market for consultancies currently undertaking work on behalf of airspace change sponsors. It is likely that the end-state UKADS will primarily focus on ACPs within the Manchester and London clusters. The primary beneficiaries of the resulting efficiency (fuel) savings will be operators in these areas. It is therefore probable that the impacts will be disproportionately experienced in London, the South East and the north of England.

Part B

The department considers the impact of the proposal on wider government priorities, stating that it will support the government’s mission to kickstart economic growth and the department’s aim to deliver greener transport, by facilitating reduced carbon emissions and noise per flight.

The policy will support the business environment by facilitating a reduction in airline operating costs and flight delays, which is likely to increase the attractiveness of the UK aviation sector. The department indicates that the policy will have a positive international impact, as it will remove some constraints on capacity within the UK aviation sector.

The OA explains briefly that this may lead to an increase in inward investment as overseas operators will be likely to benefit from additional capacity. The OA would benefit from providing evidence to support this impact.

The department states that the policy will have a positive impact on decarbonisation. The department has considered the trade-off between additional flights resulting from increased capacity and the emission reductions from more efficient airspace management - explaining how airspace modernisation aims to increase flightpath capacity; but the use of that additional capacity is dependent upon other decisions - in particular planning decisions related to airport expansion.

Monitoring and evaluation

The OA explains that there is an existing monitoring and evaluation plan for the initial UKADS. The department does not commit to a set timeline for completing a post implementation review due to the end-state UKADS being introduced through secondary legislation at a later stage. The department outlines several metrics that could be used to assess the success of an end-state UKADS, such as a high gateway pass rate.

The OA could benefit from including further detail on the process data that is already captured, such as whether this is quantitative or qualitative, as well as the frequency and scope of data collection. The OA states that alternative metrics could be used to assess other impacts, including wider benefits, but could discuss what alternative metrics may be available. The OA could then relate these directly to the theory of change diagram and SMART objectives. The OA could also consider any external factors that will have an impact on the success of the intervention.