Speech

Airports Operators Association

Speech by the Rt Hon Simon Burns MP, Minister of State for Transport.

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

The Rt Hon Simon Burns

Opening remarks

Thank you Andrew. Ladies and gentlemen.

And thanks to Ed for inviting me to speak today.

Over the years it has become something of a tradition for transport ministers to speak at the AOA conference…

Not only because it’s firmly established as one of the most important events in the aviation calendar…

But also because it attracts such a distinguished and expert audience.

So I’m delighted to be here today - and to have this opportunity to talk about the crucial role that aviation has to play in our economic recovery.

20 years of change

Now - both the new Secretary of State for Transport Patrick McLoughlin and I are politicians of a certain vintage.

Together we have clocked up more than 25 years of service as MPs, ministers, and whips in government and opposition - including for Patrick a 3 year stint as Minister for Aviation in Margaret Thatcher’s last government.

Looking back over that time, it’s extraordinary to see how the aviation industry has changed…

The deregulation of air travel in Europe, and the proliferation of hundreds of new routes from UK airports…

The low-cost, no-frills revolution, which helped make flying affordable to millions more Britons…

The global reassessment of airport security after 9/11…

And the impact of the internet on the way we shop for flights and holidays.

But while aviation has changed over the past 2 decades, our job in government remains precisely the same.

Dealing with debt.

Stimulating growth.

Pulling every possible lever to create jobs, attract investment, and help some people get on.

Patrick and I were part of a government that not only experienced the recession of the early 1990s… but that also took the tough decisions needed to lead our economy out of recession…

Decisions that built a foundation for growth and prosperity lasting well into the following decade.

And that’s exactly what we’re in government to do again today.

Transport and growth

I’m excited to be part of the ministerial team at the DfT, because I’m a firm believer in the transformational potential of transport.

In my book, transport doesn’t just support growth. It creates it.

One of the reasons why Britain was so powerful in the 18th and 19th centuries was its relatively easy and affordable access to a massive world market.

It was Britain’s mastery of trade routes - over sea and over land - that gave us such a huge competitive advantage.

Thanks to transport, Britain had better, faster and cheaper links to raw materials - and to a global customer base - than its rivals.

Today, it is the same ready access that is driving the growth of economies like China, India, and Brazil.

The lessons for developed countries like Britain are clear.

Simply making the best products is of no use if you can’t connect with the right market.

For decades, Britain has failed to invest in its transport infrastructure, and we are paying the price today in lost growth.

It’s why we are investing in our roads and railways, to reduce congestion and overcrowding, and link businesses with buyers.

It’s why we are investing in a new high speed rail network - so firms in Leeds and Manchester and Liverpool can connect with customers in London and Lille.

And it is why - in a fast changing industry like aviation - we need a clear strategy to boost passenger service, and maintain our excellent air links with the rest of the world.

But as I will explain shortly, any such strategy needs to stand firm over a period of more than a decade - and across several general elections. That is why it is so important that we take the time we need to get this right and to build a strong consensus of opinion behind the best option.

What we’re doing

There has been real progress under this government.

We are taking forward the Civil Aviation Bill to modernise the regulatory framework for civil aviation in the UK. The Bill enables the CAA to bring a strong consumer focus to its activities, improving transparency and accountability, and ensuring a better service for passengers.

The recommendations of the South East Airports Taskforce are being implemented, including a trial of operational freedoms at Heathrow to improve reliability and reduce delay.

We’ve announced a number of short-term measures to improve operations and stimulate growth, including £500 million towards a western rail link to Heathrow….. a review of the UK’s visa regime…. and the recruitment of extra border staff at Heathrow….

And in July we published a draft aviation policy framework (APF) and have put it out for formal public consultation - so that the final framework can be adopted by the end of March 2013.

The final version of this key document will then be a formal statement of government policy setting the high-level parameters within which any new proposals for airport development may be considered.

Connectivity and hub capacity

These improvements are timely and necessary.

But they will not on their own solve our long-term connectivity and capacity issues.

We are well served today.

The UK is one of the best connected countries on earth.

London has more flights to more destinations than any other city in Europe.

And we are fortunate to have so many flights to important trading partners - and global financial centres - like New York, Singapore and Hong Kong.

In what is still a dynamic market, new routes and services continue to be added.

From the end of this month, for instance, the UK will be served by daily flights to Guangzhou - a city that has been held up in the past as an example of our national failure to secure routes into the developing Chinese market.

New services to Mexico City were announced only last week.

And of course new destinations are being offered all the time.

But UK aviation is not only about the south east of England.

We are fortunate in this country to have so many excellent airports outside London, which not only help attract inward investment, and provide access to the global market…they also act as major employers in their own right.

Of course the downturn has affected most AOA members, just like it has businesses throughout the economy.

But many airports outside London and the South East continue to perform exceptionally well considering the wider economic picture.…

From Manchester, which saw passenger numbers rise by 6% to 19 million in 2011, to Belfast International, and Aberdeen.

This growth is being supported by significant investment - at airports like Birmingham, Newcastle, and Bristol - to boost capacity and improve the passenger experience.

However, the growth of airports throughout the UK cannot disguise the wider reality that Britain has failed to follow Germany, France and the Netherlands in planning for our long-term connectivity needs.

The danger is that we risk seeing our direct European competitors benefiting more from the fast growing markets of emerging economies.

Difficult decision

So we are absolutely clear.

Maintaining the UK’s status as a leading global aviation hub is fundamental to our long term international competitiveness.

Yet - at the same time - we must also take full account of the social, environmental and other impacts of any expansion in airport capacity.

This is one of the most difficult debates in transport.

Few other issues have the same potential to provoke a divided response.

Successive governments have sought to develop a credible long term aviation policy to meet the international connectivity needs of the UK……

And in each case the policy has failed.

Either trust in the process has broken down….. consensus on the evidence for the policy has drained away…… or it has proved too difficult to sustain a challenging long term policy through a change of government.

Not only can the aviation industry ill afford for this indecision and failure to continue.

The country can’t afford it either.

Commission

So the government has asked Sir Howard Davies to chair an independent Airports Commission.

Sir Howard’s remit is to identify and recommend the options for maintaining this country’s status as a global hub for aviation - and indeed as Europe’s most important aviation hub.

The commission will also evaluate how any additional capacity requirements should be met in the short, medium and long term.

The coalition agreement is clear, and continues to represent the position of this government.

But the commission must consider all options if it to reach the best conclusions.

That includes a third runway at Heathrow, and schemes in the Thames Gateway proposed by the Mayor of London and by Norman Foster.

The commission will be fair and open, taking account of the views of passengers, residents, the aviation industry, business, local and devolved government and environmental groups.

An interim report will be prepared for government no later than the end of 2013, and a final report by the summer of 2015.

We will be in a position to tell you more about the membership of the commission and its terms of reference in the next few weeks.

The commission’s work will not clash in any way with the draft aviation policy framework.

In fact it will complement it.

When we publish the final policy framework next year, it will still establish the high level aviation policy of this government.

That means it will set the parameters within which Sir Howard will consider the aviation needs of this country - and the options for delivering those needs in the short, medium and longer terms.

The framework consultation is therefore an important opportunity to influence government aviation policy.

I want to thank those of you who have engaged with us during the consultation - and encourage those who have not submitted a response to do so in the next few weeks before the end of this process.

Conclusion

Now of course I can’t speculate on what the conclusions of the commission will be.

But what I can assure you of is the importance of this work - and the determination of this government to find a solution that’s best for Britain.

We will seek to involve the opposition throughout the process.

And I hope all main parties will back Sir Howard’s findings - because it’s crucial that we make a commitment that transcends party politics.

The Olympics have shown just what we can do if we are willing to make big decisions, work together, and stay the course.

The success of the transport system during the Games was the result of co-ordinated planning by the coalition and the previous government, Transport for London, the Department for Transport, and many other organisations over many years.

I would like to pay tribute to many of the companies and organisations represented here today who worked so hard during the Olympics to provide such a welcoming and professional service to visitors who flew in from all over the world.

This was a major logistical challenge for the aviation industry.

Many predicted failure.

But you showed a real spirit of collaboration and collective determination to turn it into a triumph.

And it is that same spirit - of working in partnership towards common goals - that we need to foster again…. once conclusions have been drawn from the work of the commission and the aviation policy framework.

I think we all realise that we are living through some of the toughest economic conditions for generations.

But we are also living through a time of great opportunity.

Either we can repeat history, and fail once again to confront the infrastructure problems which hold our economy back.

Or we can learn the lessons from history, and build a better future for Britain.

That is what we are doing in government. And with your help, that is what we will do.

Thank-you very much indeed.

Published 22 October 2012