Civil Air Transport (Competition)

Oral Answers to Questions — Trade – in the House of Commons at 12:00 am on 2nd July 1979.

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Photo of Mr John Wilkinson Mr John Wilkinson , Hillingdon Ruislip Northwood 12:00 am, 2nd July 1979

asked the Secretary of State for Trade whether he will instruct the Civil Aviation Authority to implement the recent recommendations of the Commission of the European Communities on deregulation and the encouragement of competition in civil air transport in Western Europe.

Photo of Mr Norman Tebbit Mr Norman Tebbit , Waltham Forest Chingford

I understand that the Commission has agreed recently that discussion should start within the Council of Ministers on Community action to encourage the development of air transport services. I shall have consultations with the Civil Aviation Authority, the airlines and other interested parties before I make my response to any proposals.

Photo of Mr John Wilkinson Mr John Wilkinson , Hillingdon Ruislip Northwood

While welcoming that statement, I ask my hon. Friend to assure the House that he will consult the Secretary of State for Foreign and Commonwealth Affairs about bringing pressure to bear on the Governments that have withheld the cheap flight services that were to be initiated by British Caledonian to a number of European destinations.

Photo of Mr Norman Tebbit Mr Norman Tebbit , Waltham Forest Chingford

Matters of agreement on fares and air services are always difficult because of the relationships between countries. As my hon. Friend knows, there have been a number of recent cases where the increase in fares has been refused on such routes. Therefore, as time goes by the fares are, in real terms, being reduced. That is a policy that will be continued where we are unable to negotiate lower fares immediately.

Photo of Frank Dobson Frank Dobson , Camden Holborn and St Pancras South

Will the Minister tell us whether it is the Government's intention to instruct the appropriate authorities to sell off the duty-free shops at airports?

Photo of Mr Hugh Dykes Mr Hugh Dykes , Harrow East

Will my hon. Friend undertake to ensure that the Government will give maximum encouragement to the Commission in the efforts to reduce fares? Does he agree with me that, on average, air fares between European countries are about 75 per cent. or 80 per cent. more than their United States equivalents? That is without economic justification and results more or less exclusively from the fact that European fares are still classified as international.

Photo of Mr Norman Tebbit Mr Norman Tebbit , Waltham Forest Chingford

I note what my hon. Friend says. Fares in Europe are often high—perhaps unjustifiably so. I am aware of the Commission's proposals, and we shall consider carefully whether their adoption would bring overall benefit. Fares between countries within the Community are classified as international because that is what they are.