With permission, Mr. Speaker, I should like to make a statement about the Government's policy for airports.
It is the responsibility of Government to ensure that sufficient capacity can be provided at United Kingdom airports, where it is required and in due time. Our policy of encouraging competition in the air requires that there should be enough capacity available, so far as is possible, to all airlines on equal terms.
We cannot direct flights to airports that they do not wish to use. Airports must use the opportunities open to them to attract as many flights as they can through providing a cheap and efficient service for the benefit of the passengers.
To make airport managements more responsive to their customers' and further to assist the growth of our most important and successful airline industry, the Government have decided to introduce legislation, first, to make every major airport into a limited company, and, secondly, to convert the British Airports Authority into a holding company and to privatise it with its seven airport companies.
I hope that local authorities will follow this lead and introduce private capital into their companies, too; but we do not intend to force them to do so. A system of regulation will be proposed to control the monopoly aspects of airports, including charges, to regulate traffic distribution when necessary, and to safeguard essential national interests.
Our air transport industry is the envy of the world and a great success story. It has a turnover of £4 billion and earns £500 million of foreign exchange each year. It is a growing industry, already employing 85,000 people.
It is essential to the continuation of this success, and to the provision of more jobs, that there is sufficient airport capacity. Equally important, this must be done with minimum damage to the environment and to the lives of people living near airports.
It is with solving this dilemma—adequate capacity with minimum environmental damage — that first the Inspector at the airports inquiries, and more latterly the Government, have had to grapple. I should like to pay tribute again to Mr. Graham Eyre, QC, for his thorough and comprehensive report. In announcing our decisions today, I want to stress that we have sought a solution which meets both objectives as far as is humanly possible.
The success of our regional airports depends on them handling more traffic, which in turn depends on a growth in demand and on more airlines deciding to operate services from them. The signs are good. Traffic grew by 12 per cent, last year and is expected to increase by one third more by 1990. 1985 has seen the introduction at regional airports of many new scheduled services to international destinations, and more are planned. The Government will do everything they can to increase flights to and from the regional airports, first and foremost by British airlines. As regards foreign airlines, we recently reached an agreement with the Government of Singapore which allows Singapore Airlines to operate to Manchester. We expect shortly to begin discussions with the United States Government about the basis on which scheduled traffic rights to Manchester for United States airlines may also be granted.
We will continue to study, with representatives of the regional airports, how to increase traffic still further. We will be ready to approve worthwhile investment in new facilities and the improvement of road and rail links where they are justified. We will ensure that competition between all airports, both BAA and local authority, will be on fair and equal terms. We recognise the importance of maintaining access for domestic flights into Heathrow and Gatwick.
Even after taking account of all these efforts to attract traffic to the regions and away from the south-east, the Government, after careful evaluation, have concluded that it is necessary to provide capacity in the south-east for between 72 million and 79 million passengers per annum by 1995. This is consistent with the inspector's planning figure of 75 million passengers per annum. We intend to achieve that figure as follows:
First, my right hon. Friend the Secretary of State for the Environment recently announced approval of the Stolport in London's docklands. This will provide 1 million passengers per annum.
Secondly, the Government have decided to invite Luton borough council to come forward with proposals, which would be subject to the necessary planning procedures to increase the capacity of Luton airport from its present throughput of 2 million passengers per annum to 5 million passengers per annum.
Thirdly, Gatwick airport is expected by that time to be capable on present plans of handling 21 million to 23 million passengers per annum. We have no plans for a second runway at Gatwick.
Fourthly, the capacity at Heathrow in 1995, when all four terminals will be in full operation, is expected to be between 38 million and 42 million passengers per annum. It is very possible that this will be adequate to handle as big a throughput of passengers as runway capacity will allow. The Government have decided to accept the inspector's recommendation that air transport movements at Heathrow should not be artificially constrained and to ask the House to accept the abandonment of the proposed limit of 275,000 air transport movements a year. Even with this, and with all foreseeable technological improvements to the full use of runways it seems likely that runway capacity, not terminal capacity, will be the limiting factor at Heathrow for some years ahead. Nevertheless, it seems prudent to ask the BAA to pursue with the Thames Water Authority the possibility of moving the Perry Oaks sludge works elsewhere. Only if and when this has been done, and in the light of traffic forecasts at that time, would it seem sensible to see whether extra terminal capacity should be provided, and if so how much. My right hon. Friend the Secretary of State for the Environment, on whose behalf the Minister for Housing and Construction has acted throughout, has turned down Uttlesford district council's application for planning permission for terminal 5, and no terminal can be built at Perry Oaks in the future without planning permission. We are setting up a study of improved surface access to Heathrow.
Fifthly, I come to Stansted. It will now be abundantly clear that the only way we can provide sufficient capacity to sustain the growth of our successful aviation industry is by terminal development at Stansted, thus bringing into more effective use the spare runway capacity which is available there. My right hon. Friend the Secretary of State for the Environment and I have therefore decided to accept the inspector's recommendation to the extent of granting the BAA outline planning permission for development at Stansted. The application was for 15 mppa. The inspector recommended initial permission for this 15 mppa rising later to 25 mppa at Stansted. Although we have granted permission for the 15 mppa recommended by the inspector, we have decided to impose conditions requiring that the development be phased, and limited in the first phase of development to 7 to 8 mppa. The initial development will thus amount to less than one third of what the inspector recommended ultimately. Apart from the planning decision I propose to seek powers to limit air transport movements at airports. Subject to Parliament giving me the necessary powers, I intend to impose an initial limit on air transport movements at Stansted equivalent to 7 to 8 mppa. Any further increases in traffic at Stansted would be subject to control by Parliament, by means of an affirmative resolution. As a result, further growth of traffic at Stansted would only take place when it was seen to be necessary, with Parliament having the decisive role. This should provide reassurance to people living in the area. We have rejected the possibility of the construction of a second runway at Stansted.
In the past, we as a nation have shirked the decisions needed for the growth of air traffic and the jobs that go with it. We are in danger of stifling one of our most enterprising industries and losing out to our continental rivals: Schiphol, Paris and Frankfurt are building capacity well ahead of growth. They no doubt hope that we will shirk the decisions once again. The Government are determined not to.
The decision letters on the planning application and the White Paper, all of which are now available in the Vote Office, set out the arguments for these decisions at length and with clarity. When they have read them, I hope that right hon. and hon. Members will feel that our responsibilities to all the many important and often divergent interests concerned have been adequately discharged.
The Secretary of State has made a major statement on future airports policy. The one thing that is certain is that it gives the green light and go-ahead in the south-east of the country. It represents a list of broken promises. For example, a solemn promise was given to those living around Heathrow airport that the controls on aircraft movements would be respected, but that has been abandoned. Undertakings were also given to Manchester that it would be given assistance in developing as a regional airport. It was also suggested that, by somehow privatising the aircraft industry, we could support regional airports in, for example, Scotland.
Why should we believe the Secretary of State when he says, on the one hand, that he intends to privatise extensively to improve the future of the aircraft industry and, on the other, that he intends to ask the House for greater controls both on air traffic movements and on future developments? Why should we believe, for example, that he will move the Perry Oaks sludge works but has no intention of building a fifth terminal? Why should we believe that the right hon. Gentleman is now going to assist the regional airports when, in effect, he has materially reversed his position since January 1985? In January, he said that he would give every possible support, particularly to regional airports. But the White Paper now makes it quite clear that in future any developments can go ahead only if the market has proven itself and the development is already there. That restriction is quite unacceptable.
What the right hon. Gentleman has done is to say that in future there will be added capacity at Stansted and Luton and increasing use of Heathrow. He is wholly uninterested both in the environmental aspects of the development of the major airports in the south-east and the very real industrial problems of the north. The statement is a slap in the face for regional airports and it should not be accepted by the House.
I quite expected the hon. Lady to respond with predictable, old-fashioned reaction to the suggestion that the airport should be privatised, so I shall leave that typical reaction to one side.
On Manchester and the regional airports in the north:
The Government rejects the suggestion that the air transport industry should be subject to the damaging restrictions on its operations which would be the outcome of the forced diversion of traffic to regional airports".
If the hon. Lady does not agree with that statement, she might like to know that I was quoting her Government's White Paper of 1978. What was good enough for that Government is good enough for me. [HON. MEMBERS: "Oh."] With the exception of that, there is nothing that the north-west and the other regions have requested in the development of their airports that is not contained in the White Paper. When the hon. Lady has time to read it, she will find that that is so. No restrictions are being imposed on any development.
The hon. Lady appeared to be a little muddled. She accused me of abandoning the limit on air transport movements at Heathrow — about which the House expressed some disquiet earlier in the Session — and suggested that it should be proceeded with. At the same time, she appeared to want to have terminal 5 built, which would have meant more traffic going through Heathrow.
Is my right hon. Friend aware that very many of the 1·75 million people living around Heathrow, who were dreading the intolerable traffic congestion and noise that would have resulted from a fifth terminal, will be immensely grateful and relieved at the decision not to build a fifth terminal and to turn down the current planning application? I speak also for my right hon. Friend the Member for Spelthorne (Sir H. Atkins), who is currently abroad on Select Committee duty.
I am grateful to my hon. Friend, especially for mentioning our right hon. Friend the Member for Spelthorne (Sir H. Atkins), who has already told me how sorry he is that he cannot be here, because he would have wished to be present on this occasion. [ am pleased to be able to honour, for both my hon. Friends, the Government's pledge that terminal 5 would not be constructed.
Does the right hon. Gentleman recall that, after our last debate on airports policy there was an overwhelming vote against the development of Stansted? Why has he resolved to flout that vote? Why should anyone believe that the House of Commons will have any control over these matters if he is deriding and insulting the last vote of the House on this issue?
The right hon. Gentleman may recognise two points: first, the vote was on whether the House should adjourn—[HON. MEMBERS: "Oh."] Secondly, the inspector at the airport inquiry recommended development at Stansted first to 15 million and then to 25 million passengers a year, whereas the Government are recommending that development should be limited to 7 million to 8 million passengers a year.
May I congratulate my right hon. Friend on having arrived at the same conclusion about Stansted as that at which I arrived 21 years ago? That was accepted by the Government of the day, despite the reservations of Mr. Rab Butler about the possible effect on his shooting.
I urge my right hon. Friend to go rather further than he has in recognising the enormous importance of the maximum development of Heathrow. It is not just the gateway to Britain; it is the Clapham Junction of air traffic between the American continent, the European continent and the far east. It is important that it should be endowed with all possible facilities to give it its maximum establishment. With the much less noisy aircraft and the shorter take-off now available, the environmental damage will be greatly reduced from what it would have been some years ago.
I am grateful to my right hon. Friend. Perhaps it is auspicious that, 21 years after he considered the matter, the decision should come of age. I agree entirely about Heathrow. The Government's policy as set out in the White Paper will be to use the runways to the maximum capacity, and that is the limiting factor at Heathrow. That will be in the best interests of British aviation and Heathrow which, as my right hon. Friend said, is one of the most important airports in the world, and probably the most important interlining airport in the world.
The statement on United Kingdom airports makes clear its intentions to make the major airports into limited companies. Will such legislation apply to the Northern Ireland Airports Authority? In the light of the intention to develop regional airports, will the Secretary of State be evaluating the expansion of capacity and use• at Aldergrove international airport?
Is this not a case of putting the most capacity in the wrong place to meet the prescription that my right hon. Friend has given — that it will be difficult for London to maintain its competitive position if people are invited to interline by taking a bus around the M25? On the procedural point, why is my right hon. Friend prepared to trust the voice of Parliament to defend Stansted growing beyond the 8 million passengers capacity when he is not prepared to give an opportunity for the House to judge the present position, which it could have done had he followed the precedent of the right hon. Member for Bethnal Green and Stepney (Mr. Shore) in the case of the Windscale inquiry?
Airports will develop the traffic and the type of trade that suits them best under the freer regime that we are providing. I suspect that, more and more, Heathrow will develop into an interlining airport with a major input of domestic services, so the situation that my hon. Friend has suggested may not arise.
Secondly, my hon. Friend spoke about a special development order and I remember how the House, and he, welcomed the decision in 1980 that the Stansted proposal should be pursued through the normal planning process and should not be decided without a full and fair inquiry at which everybody could put their view. We adopted that proposal, and we cannot now be blamed for not changing our horses in midstream to the SDO proposal. The SDO method would have meant that we would be unable to secure the compulsory purchase orders, the listed building consents, the scheduled monuments consents, the trunk road orders, the side road orders and the stopping up and diversion of highways orders that will be necessary in the permission granted at Stansted.
Is the Secretary of State aware that his acceptance in principle and ultimately in practice of the development of Stansted airport into one of 15 million passengers per annum will cause the gravest concern in the north of England?
Julian Haviland, who is rightly respected on both sides of the House, reported this morning inThe Times the Minister's derisory comments about forcing Londoners onto Manchester-bound trains to fly to Paris. Is the Secretary of State aware that that is offensive not only to Mancunians, Geordies and people from Yorkshire and Scotland, but to people from all over the north? Is he aware that as many as 30 per cent, of the people who fly into and out of London airport are not from the south-east and do not want to fly there? Why should millions of northerners have to catch London-bound trains to fly abroad?
What does the statement do about licensing policy as it affects regional airports? What will the Secretary of State do urgently to stop the cross-subsidy of Stansted airport by the British Airports Authority? The right hon. Gentleman has missed an opportunity to unite this nation at a time when it is bitterly divided.
I must differ from the right hon. Gentleman on his three main points, because he is not right. The development at Stansted is limited to 7 million to 8 million passengers per annum, and if the House does not want to go beyond that traffic figure, it lies within the power of the House to prevent it. Secondly, the right hon. Gentleman said that 30 per cent, of the passengers going through London airports are not from the south-east. However, the true figure is that 25 per cent, of the passengers going through London airports are not from the south-east, and of that 25 per cent., 5 per cent, comes from the north-west and the north-east, with the rest from other parts of the United Kingdom. More people come from the south-west than from the north-west in passing through London's airports. The right hon. Gentleman's figures are not entirely right.
We have met the right hon. Gentleman's point that cross-subsidy to Stansted or any other airport will be stopped by making them separate limited companies. Any flow of funds will be transparent, and it will be made clear that those flows of funds must carry commercial interest rates. Therefore there will be no cross-subsidy.
I congratulate my right hon. Friend on continuing to be the Minister who has done most for regional airports of any since the war. However, will he remember that the two crucial matters for the north about the expansion of Stansted are that there should be no subsidy in that area, so that competition is free, and that the supporting infrastructure will be of a limited nature? Can my right hon. Friend confirm that that will be the case in both instances?
I am grateful to my hon. Friend and I can confirm that there will be no subsidy to Stansted. The only investment will be of commercially raised money paying commercial rates of interest. That will cause landing charges to rise at Stansted to levels commensurate with other airports.
Secondly, the figures that I can give my hon. Friend for the infrastructure needed at Stansted development are £2 million for local roads. As well as that, there may or may not be some investment on rail infrastructure which could be about £50 million. That will be only if the investment appraisal of any scheme considered and put forward by British Rail achieves a positive result.
Does the right hon. Gentleman accept that his fine words about regional airports fall a long way short of the real commitment that is needed if they are able to compete fairly? How realistic are the limitations on development that the right hon. Gentleman is proposing for Stansted? Surely it will be attractive to airline operators only if it has the fast rail link that the inspector recommended. British Rail tells us that it cannot justify financial investment without far more passengers at Stansted than the Secretary of State is suggesting. Is he not opening the door to the full-blooded development of Stansted?
As an earnest of our intentions to improve and expand flights from regional airports, I point out that there are now 33 international scheduled services from Manchester airport, 14 of which have been inaugurated this year alone. That is a measure of what the Government are doing to increase traffic at regional airports. As I said in the statement, we shall continue to explore ways of getting more flights into the regional airports.
Secondly, on British Rail, nobody has known until now about the development of 7 million to 8 million passengers per annum at Stansted that I have announced today. Until British Rail has had a chance to assess the possibilities, it will be impossible to know how much it will cost and whether it will be economic at all. Far from opening the floodgates to Stansted, the result of my announcement may be that it is not economic to provide a rail link, and that would be a brake upon the development of Stansted.
I congratulate my right hon. Friend on guaranteeing the future of Luton airport and, indeed, offering the prospect of a considerable number of new jobs in the area. Will he confirm that 5 million passengers a year is a final figure and that it will not be allowed to increase? Will encouragement be given to scheduled air services to use that airport, rather than developing the charter traffic that we have had to date?
I am grateful to my hon. Friend. Luton borough council will be invited to submit proposals, which might be subject to a planning inquiry. I gather that the limit on what can be accommodated at Luton is controlled by national air traffic considerations and is unlikely to exceed 5 million passengers. It will be for the borough council to make such proposals as it sees fit.
My hon. Friend also asked about scheduled flights from Luton. I believe that some are taking place already but there will be no inhibition on scheduled flights to any airport to which an airline applies for a route licence to operate.
Will my right hon. Friend accept that many of my constituents will be bitterly disappointed at the decision not to go ahead immediately with a fifth terminal at Heathrow? They will believe that he does not understand the needs of Heathrow and that, because he has not listened to them, he does not understand the operating needs of the airlines that are using Heathrow.
There is no possibility of putting a fifth terminal in the middle of the Perry Oaks sludge works. I am sure that even my hon. Friend would agree that the sludge works would have to be moved first. Surely it would make sense to decide on the scope and size of the terminal which might be put there when we discover whether any terminal is necessary after the sludge works has been moved.
Why does the Secretary of State not admit the truth—that the huge increase in capacity in the southeast of England will make every Scottish airport less viable and will make it less likely that there will be direct flights from Scottish airports to destinations overseas? Since he has recently announced the continuation of Prestwick as Scotland's transatlantic gateway, what assurances has he received from the British Airports Authority and what guarantees will there be that Prestwick will continue to be Scotland's transatlantic gateway and, indeed, will remain open? Is he aware that we find it very sinister that separate companies are to be set up and that the British Airports Authority will not be privatised as one company?
In the last year there has been a 20 per cent, increase in flights from Edinburgh to London. If that rate of growth continues, I shall have to find still more capacity in the south-east to accommodate the flights that the hon. Gentleman wants to travel on. How he can want both more aviation out of Scotland and less landing space in England beats me. The airport at Prestwick was the subject of a recent announcement in response to a question, and I have nothing to add to what was said at that time.
Is my right hon. Friend aware that the removal of artificial constraints on the number of landings at Heathrow will be helpful to many provincial airports? He is to be congratulated on stopping the subsidy to Stansted. Is it not bizarre that for years charges for aircraft at that airport have been subsidised by large sums out of the profits of the so-called duty-free shops at Heathrow, to the disadvantage of provincial airports? Will not the change be very important for airports such as Manchester?
I agree entirely with the two points that my right hon. Friend has made. First, it is important to keep as much access to London, and particularly Heathrow, as we can for domestic flights from the rest of the country. Secondly, I confirm that Stansted has benefited financially from the profits of other BAA airports. This should not be the case in future under our proposals.
Is the Secretary of State aware that he missed the point about flights from Scotland to London? We do not want more flights to London; we want more flights from Scotland to destinations abroad without having to come through London. In the case of Prestwick, how does the Secretary of State expect a private limited company to operate Prestwick, given the bias towards the south-east in his statement today? Does his statement not make a farce of the review that was promised for Prestwick? Indeed, have we not heard from him today the pronouncement of a deferred death sentence on Prestwick?
I said earlier that we would do all we could to increase flights from any regional airport. That does not exclude Scottish airports. They are in that category from the point of view of what I was saying. We shall do what we can to license flights out of airports in the rest of the United Kingdom.
Let me make it clear that my statement will not have the effect that the right hon. Gentleman suggested in regard to a public limited company at Prestwick. All that can happen is that it will show a loss in its accounts at the end of the year, and it does that anyway.
My right hon. Friend is to be congratulated because, for the first time for many years, we have a Minister who has grasped the nettle. Contrary to some of the comments that have been made about Scottish airports, I am confident that they will continue to prosper, as they were doing for a long time before the OPEC oil price increases; they are now recovering. Will my right hon. Friend confirm that the Scottish airports will be managed largely by Scots?
I am grateful to my hon. Friend. I can confirm that the British Airports Authority, while still in public ownership, will be invited to continue to have a Scottish vice-chairman and to have a large degree of Scottish management. Of course, if it passes into the private sector those matters will be beyond Government control, but I am certain that it will be in the interests of the new company to make sure that the four Scottish companies are managed predominantly by Scots.
Is the Secretary of State aware that his statement today will be greeted with disappointment and perhaps anger by the northern regions, which will see it as another example of the Government's disregard of their problems? What effect will the statement have on Liverpool airport in my constituency? Will he give an assurance that the sludge works will not be shifted to Liverpool?
I must repudiate both those suggestions. I do not remember a more helpful and determined attempt to assist the north. It is not more runway capacity, terminal capacity or airport capacity that is needed in the north of England, but more flights. The more flights we can get into the north, the more that will help the northern airports to expand and in due course to need more capacity. That is what we seek. I can give the hon. Gentleman an absolutely categorical assurance that the sludge works will not be moved to Liverpool.
I suggest that the hon. Lady reads the White Paper. Can my right hon. Friend give a firm commitment to the constructive development of an international hub at Manchester? Can he give an assurance that, if British carriers are unwilling or not prepared to apply for flights on viable international routes out of Manchester, the applications of foreign carriers will be approved speedily and will not be subject to the two-year delay that Singapore Airlines had to endure?
I am grateful to my hon. Friend. I am sure that if hon. Members read the White Paper they will discover more than I have been able to explain in my short statement.
I confirm that we intend to try to help Manchester airport build itself up into a hub for the north of England. That is what I said when I offered help to try to bring more traffic to that airport. The Singapore Government applied in March for a flight to Manchester and agreement was reached within six weeks. That is almost a record time for coming to an agreement on such a major application.
I am sure that my hon. Friend will agree that, although we want to do everything that we can to maximise traffic into and out of Manchester and the other regional airports, we want to give our airlines a good opportunity in the countries with which we are dealing. The greatest contribution to jobs that a regional airport can make is by British airlines obtaining traffic rights to fly out of the regional airports to overseas capitals. It is not just a question of welcoming foreigners into our regional airports, but of making deals which will benefit Manchester, for instance, and create jobs in the north.
Is the Secretary of State aware that he is to be congratulated on one matter alone? He seems to have done enough to buy off his own Back Benchers from the north of England, but it is a policy for one region—the south-east—not a policy for the north.
When did Manchester ever ask for further runways or terminals? Manchester has always made one simple request — to be given the flights. It has always been denied that and the Minister has denied it again today. Manchester is not a regional airport. It wants to be a national gateway airport, as promised.
Manchester is a gateway airport and will remain so. If the hon. Gentleman reads the White Paper he will discover that there are already route licences for 1,500 overseas routes out of the regional airports, of which only 100 have so far been taken up. The problem is to persuade airlines to take up more overseas routes from regional airports. That is the real problem from which all regional airports suffer and that is why the Government have addressed themselves with enormous diligence to trying to help put it right.
May I congratulate my right hon. Friend on honouring his promise not to construct the fifth terminal? Is he aware that that will bring great relief—[Interruption]. It certainly will not be constructed in this Parliament or the foreseeable future.
Is my right hon. Friend aware that my constituents suffer more than others from the noise problems, but are not entitled to proper funds to pay for insulation grants? Is he further aware that I am disappointed that the pledges about the number of flights given on 22 February and 21 November 1984 are not to be honoured? We are told that access to Heathrow will be increased, but I do not see how it can be increased by road improvements into London and most people travel to Heathrow by road. Is my right hon. Friend aware that his decision about Perry Oaks will be heavily criticised generally, not only by the Berkshire county council?
I understand my hon. Friend's point of view. He is right that the decision on terminal 5 will be of some comfort to his constituents. Aircraft are rapidly becoming quieter and will become even quieter as new types are phased in. That will make a great difference to the noise in his constituency.
The Government were in a difficulty when the inspector on terminal four suggested that an ATM limit should be imposed on Heathrow and the inspector at the inquiry on terminal five suggested that there should be no such limit. The Government had to make up their mind and put their decision to the House, which will in due course have to accept or reject that decision.
Underground and rail access to Heathrow will be studied as carefully as road access because we must try to improve traffic between London and Heathrow in any way we can. Matters relating to Perry Oaks are perilously close to being the responsibility of my hon. Friend the Minister for Housing and Construction.
What steps will the Secretary of State take to ensure that the environmental damage and difficulties from which people near all airports suffer will be dealt with in the proposed legislation? Can the right hon. Gentleman explain the apparent illogicality in saying that he intends to take powers to limit air traffic movements—to apply immediately at Stansted — and that he also intends to remove restrictions at Heathrow, and presumably elsewhere? Where is the logic in that, when he knows that restrictions on movements are wanted not for commercial reasons, but for environmental reasons?
When the hon. Gentleman reads the White Paper he will see that further protection in terms of abatement measures and of insulation are proposed for those living near Stansted. We shall further develop our understanding of what helps most to ease the pressure on people from aircraft noise.
Perhaps the Liberals would neglect to worry about this, but I have to provide sufficient capacity for the air transport industry to grow and to provide jobs. The decisions are based on there being adequate capacity for planes to land in the south-east of England. That is why, reluctantly, I have to recommend to the House that we should not put an artificial limit on the number of flights that can be accepted at Heathrow. My hon. Friends who represent areas around Stansted have made it clear that they want some protection from too great an expansion of Stansted.
The hon. Member for Southwark and Bermondsey (Mr. Hughes) asked me how I intended to protect the environment of those who live near Stansted and other airports. The answer is that I intend to impose an ATM limit, which he seems to be against.
In an attempt to evaluate the environmental impact of the decision on Stansted, having been told the number of passengers per year anticipated, are we not also entitled to hear the Secretary of State's views on the type of traffic which he envisages? If he is prepared implicitly to apply a movements limit to the expanded Stansted, might he also be prepared to impose a night curfew on Stansted? If that is so, does it not imply that he should be looking for charter traffic rather than scheduled traffic?
All these matters are dealt with at length in the White Paper. We did not think it right to accept the inspector's recommendation that there should be night bans at London airports, although the present restrictions will certainly remain and possibly be tightened to ensure that night flying does not increase. A ban would be going too far.
The hon. Gentleman will know that we had either to accept or reject the recommendations in the inspector's report. It would not have been appropriate to suggest a totally different site, but I confirm that the Government do not believe that any new site, not mentioned today, would be preferable to the sites that we have been studying and about which we have made decisions.
Does my right hon. Friend accept that many of my constituents will greet his announcement with great anger and disappointment? They have fought the development of Stansted over 25 years and through two different public inquiries, only to face the decision that he has made today. My constituents are prepared to play their part in the national interest and accept that some development has to take place. I am grateful to him for the limitation to which he has agreed of 7 million to 8 million passenger movements per annum, although I believe that that is far too high a limit. I am also grateful for the fact that he has prevented cross-subsidisation of Stansted airport.
However, will my right hon. Friend accept that his proposals will result in great detriment to the environment of the area and that the people of Sawbridgeworth will have to suffer all the inconveniences of air traffic noise and pollution and a crowding of the very inadequate roads all around that airport, which he has apparently made no provision to improve? Will my right hon. Friend tell me —perhaps his hon. Friend the Minister for Housing and Construction will advise him on this — whether he intends to break the green belt policy that surrounds that airport to the north and to the south, and whether he will prevent the tremendous competition for jobs in an already over-employed area and the inevitable expansion of urbanisation which will occur unless strong measures are taken by his hon. Friend the Minister to prevent it?
My hon. Friend the Minister for Housing and Construction will have heard what my hon. Friend said about the planning aspects of the decision and its future consequences. I have total understanding of the disappointment of some of his constituents and the fears about their peace and the environment of that very pleasant part of the country. But I am sure that he will equally accept that, as a result of that sympathy, we have gone a very long way to limit the development to that which is essential in the national interest for the aviation industry. I think that the House would blame me, with particular justice, if in a few years traffic had to be turned away and perhaps had to go to the Continent and the transport of the country was interfered with. I hae tried through the subsidy assurance and the ATM limit which he mentioned to make this development happen only if it is necessary and economic, and I think the fact that the House will have a further decision to take if ever further expansion were proposed should be of considerable reassurance to his constituents.
May I ask the Minister not to concentrate on the spin-off to Manchester from the south of the country? What does he intend to do to establish Manchester as a national airport and the economic and tourist gateway to the north-west? What does he intend to do to establish that airport not as a subsidiary airport but as a national airport in a region with one of the highest unemployment levels?
The hon. Gentleman must acknowledge that the growth of Manchester has been phenomenal. There has been the large growth of up to 6 million passengers per annum hitherto, and we expect that to continue. Indeed, a 30 per cent, further growth to the end of the decade is predicted. That is about as rapid a growth as any airport has ever experienced. Secondly, it is no coincidence that it has taken place during the period of office of this Government. Therefore, I think that, if the hon. Gentleman is at all honest, he will go back to his constituents and tell them what a tremendous boost to Manchester this statement has been—as have been the policies of the Government in the past.
I believe that this is the best news for the British air transport industry since sliced bread, and I should like to congratulate the Secretary of State on his radical, reforming and decisive statement today. I should like to ask him about the environment—this is not the prerogative of the Liberal party, but a matter with which the Conservative party is greatly concerned—and the lifting of the 275,000 limit at Heathrow. Can he say something reassuring to those people who live on the boundaries of that limit? As he knows, aeroplanes are getting quieter, and I think that people should be reassured that the lifting of the limit will not make life intolerable for them.
I am grateful to my hon. Friend. As I said in the statement, it is extremely difficult to balance the needs of the industry—I think that we all accept that industry has to be allowed to grow—with the difficult environmental questions about which I share his concern. There is a great deal about this in the White Paper, which I hope he will find helpful. The decline in noise levels has been and will continue to be dramatic as aircraft are required to be quieter, and as we have taken measures to protect the houses of the people who are most closely concerned, so let him not doubt that the Government are keen to do everything that we can to protect the environment of those who live around Heathrow. But let it be said that many people who live around Heathrow do so for the sake of the jobs that they have in the area, and are prepared to accept the noise and the difficulty for the sake of the prosperity that the airport brings.
Will the Minister accept that most people in Greater Manchester will be disgusted by the statement and will bitterly resent the Government's claim that they have anything to do with the success of Manchester international airport? In fact, it is an example of a municipal airport which has succeeded in spite of the Government's hostility to municipal airports. If the Government want to win any friends in the Greater Manchester area, they should consider quickly providing the one to one and a half miles of railway that is necessary to link Manchester international airport to the national rail network and ensure that nearly one quarter of the population of the country are within an hour's journey time of Manchester airport.
That staggering increase in flights, particularly international flights, which has taken place out of Manchester airport has occurred during the currency of this Government. The fact that, of the 33 international points currently served by scheduled services out of Manchester airport, 14 have begun to be served in this year alone is evidence, if the hon. Gentleman needs evidence, that the Government are not in any way prejudiced against it, but if anything are prejudiced in its favour.
Is my right hon. Friend aware that many Conservative Members representing northern constituencies disagree a great deal with what has been said by Opposition Members? In fact, the White Paper will be helpful to Manchester, especially as there will be no subsidy to put us at a disadvantage compared to Stansted?
Will the Secretary of State not accept that his statement will be seen as a kick in the teeth to people in all regions of the country, and particularly in the north-west by people who want to use Manchester airport? Will he not admit that in fact he knows that it will not be possible to maintain the ceiling of 7 million to 8 million movements at Stansted? He knows that, when privatisation takes place, to make it viable it will be necessary to go beyond that limit. That means that the fast rail link and the supporting infrastructure will have to be established, and the rest of the country once again will be paying for London to get the benefits.
I do not see how Manchester can be such a successful, prosperous and thriving airport with a throughput of 6 milion passengers per annum, if the hon. Gentleman suggests that Stansted, with 7 million to 8 million, will be totally uneconomic because of inadequate throughput. It just does not make sense.
May I take this opportunity to congratulate my right hon. Friend on getting away with such a lot today—which I suspect is probably due to the total incompetence of the hon. Member for Crewe and Nantwich (Mrs. Dunwoody), who appeared to fail to grasp what he was talking about?
When the sighs of relief of my hon. Friends have subsided and they begin to read the small print, I am sure that they will realise that this is a package which will upset many and please few and will probably be precisely the sort of fudge about which the inspector warned.
I do not think that it is ever necessary to blame the hon. Member for Crewe and Nantwich (Mrs. Dunwoody). She seldom seems to understand what we are talking about, and today is no exception.
It was not possible, given the situation that the Government faced, to make everyone feel that he had got exactly what he wanted. However, I believe that our decisions will both provide the necessary capacity and do the minimum damage to the environment of the various airports involved. If my hon. Friend reads the White Paper, I feel that he will find many statements in it to reassure him.
Is the Secretary of State aware that the development of airports such as Newcastle reflects great credit on the local authorities which have had the foresight and will to develop first-class regional airports?
The right hon. Gentleman's statement is a second slap in the face for the north-east. Only last year he refused to allow the Newcastle authority to use its own money to build a parallel taxiway and so avoid delays in landings and take-offs. Now, when the airport is producing more than £1 million of profit for the ratepayers who have provided the capital for its development, he suggests that it should be privatised. Could it be that the right hon. Gentleman regards profits for the ratepayers of the area as grossly immoral, but profits going into private pockets as very good?
The hon. Gentleman referred to Newcastle airport. He will know that the authority put in a bid for other priorities and then changed its mind about what it wanted. At any stage, if Newcastle airport wants to apply for investment approval for any project, we are always happy to look at it. However, the capacity at Newcastle airport is currently used only to the extent of 54 per cent. The airport needs not more bricks and mortar but more flights. That is why I have concentrated today on the importance of trying to get more flights into regional airports.
Is my right hon. Friend aware that his juxtapositioning of the announcement of the privatisation of the British Airports Authority with the go-ahead for Stansted will inevitably lead some of us—I am one—to believe that, rather than today's announcement being made under the heading of airports policy, it might have been made by a Treasury Minister. To allay that fear, will my right hon. Friend at least assure the House that he will privatise the BAA before Stansted goes ahead?
Turning to airports policy—
—will my right hon. Friend accept that trying to provide three London airports, none of which will be fully adequate, is a recipe for disaster? It will turn the M25, even without a channel tunnel, into a solid ring of parked vehicles on numerous days of the week. Will he assure the House much more than he has done so far that the investment in the rail infrastructure for Stansted and for Heathrow will be looked at overall not only in terms of the environment but as part of the environmental costs of airports policy?
Some of us—I am one—will give my hon. Friend the assurance that he seeks that the rail infrastructure will be looked at in the way that I said, but with sympathy because of the environmental problems.
I cannot foretell how long it will be before it is possible to privatise the British Airports Authority. That will depend on the progress through the House of the necessary legislation. I fear that I must also say that planning consent has now been granted for the Stansted development, and I have no doubt that the authority will wish to start work as soon as the necessary plans are drawn up.
Order. I shall allow questions on this statement to go on for a further 10 minutes. That means that Back Benchers will have had a full hour in which to put their questions to the Secretary of State. However, I ask for brief questions, in which case I hope to be able to call all those hon. Members who are seeking to catch my eye.
—how to provide extra capacity from the centre of London to Heathrow without causing damage to the environment again. That is exactly what we need to do.
I am grateful to my hon. Friend. The necessary legislation for privatisation will be introduced as soon as possible.
As for cross-subsidy and fair competition, putting each airport into a separate public limited company means that any transfer of funds will be transparent. As I said, we shall make sure that the transfer of funds takes place only at commercial rates of interest. That in itself will cut out cross-subsidy.
Does not today's statement about Stansted mean that once again millions of pounds are to be invested in the south of England? Is it not clear that in a few years this decision will be considered only as a toe in the door, and once again the Government will ask the House to vote millions of pounds, which again will be invested in the south? What consideration has the Minister given to industry and commerce in the north? The Government argue that there is a case for airport developments in the north not just for industry and commerce but also for tourism. How will the Stansted development help the traffic throughput in the northern airports?
The approximate cost of the development of Stansted is thought to be about £270 million. I cannot give a firmer figure than that, because the British Airports Authority has not been able to give me a quotation, having only just heard of the decision.
I do not regard that as a large investment and, of course, it is all from air travellers' money—it is not from public money. The British Airports Authority earns a surplus, and it will be investing that at commercial rates of interest in the new development.
I am as keen as the hon. Member for Manchester, Blackley (Mr. Eastham) and as Manchester to see further traffic and activity in the north of England. That is why we have put our accent on trying to get more traffic going there. It is from that that the extra jobs will flow and not from building terminals, runways, aprons and taxiways which are not needed.
In view of my right hon. Friend's concern for the environment around airports, how does he think that the beautiful rural character of the environment of Stansted will survive his proposals?
An increase in the terminal buildings at Stansted will not improve the landscape, but there is an airport there already, and there are terminal buildings. It is conceivably possible that any new buildings will be slightly more pleasant to look at than the old ones. I hope that they are. We have to find a way of marrying careful and good design with our landscape; otherwise we shall become a museum and unable to earn our living.
The hon. Gentleman may not have heard it, but in my statement I said that the Civil Aviation Authority would be asked to supervise landing fees and charges at the various airports. I think that the result of that is more likely to bring down charges imposed by a monopoly than if we allow the monopoly to be free to charge what it likes.
Further to what my right hon. Friend said about privatisation, is he happy that individual airports which operate as independent plcs will be able to raise the capital required for their future expansion without any cross-subsidisation or Government guarantees? In relation to Heathrow, while uncertainty about terminal 5 persists, does he think that that company will be able to go to the market, especially as today he hinted clearly that, subject to planning, terminal 5 will be built one day?
We shall put the seven BAA plc airports into a holding company, which will be able to make investments in any subsidiary that it wishes. The company which owns Heathrow will be one of the most prosperous companies in the country. The idea that it would not have credit to borrow to build a terminal, if one were necessary, seems unlikely.
Does not the Secretary of State realise that he is widely regarded as the Secretary of State for Transport who has dealt a grievous blow to our railway network, who wants to destroy public bus transport throughout the country, and who, with today's statement, has delivered a hammer blow to our regional airports? Does he further realise that millions of people who live in the north can see no justification for resources, whether public or private, being channelled into the south-east, that large numbers of unemployed people in the north can see no good reason for the creation of large numbers of jobs in relatively prosperous areas and, most important, that people who are inconvenienced by the existing travel arrangements can see no good reason for maximising flights from London airports?
I find that a little odd. I think of myself as the Secretary of State for Transport who has presided over the highest rate of investment in British Rail for many years. I should like to claim that I am the Secretary of State for Transport who has freed the bus services from restrictions so that they can be improved and expanded, and who has now put forward a policy for the further expansion of the airline industry, which will bring jobs to all areas.
Will my right hon. Friend consider my constituents, who are sandwiched between the development at Luton and that at Stansted? Does he recognise that they are extremely concerned on environmental grounds? Will he say what consolation I can offer them?
My hon. Friend is in a slightly difficult position. There will have to be a public inquiry if Luton borough council makes proposals for expansion, and his constituents can put forward their views then. The developments at Stansted and Luton will result in a large number of extra jobs. My hon. Friend can draw some comfort from the fact that many people living in the area will benefit from those jobs, and that many, for that reason, are not wholly opposed to airport development.
The Secretary of State will realise that hon. Members with BAA airports in our constituencies recognise the benefits that we have reaped from the managements, especially in Scotland. Is he aware of the anxiety caused by the fact that nowhere in his statement is there a suggestion that Scottish airports should be retained as a group? Indeed, he said that they would be sold off individually. Can he assure us about that? Regarding surface transport, does he recognise that the one way to help Prestwick airport to survive is to give the go-ahead to an effective rail link?
The hon. Gentleman may have misheard me. I made it clear that the privatisation of BAA would be achieved by privatising the holding company, and that the separate companies would not be sold off independently. Therefore, the group will remain exactly the same as at present, and there will be little change in the relationship in that sense. The question of a rail link to Prestwick is one for British Rail, which can submit proposals, if it finds that a link is economic. That is also referred to in the White Paper.
Although I agree with my right hon. Friend that it is impossible to please everyone on these occasions, I thank him for the courtesy that he showed to the representations made by the North-West Regional Consortium, and the weight given to them in making his decision today. In so far as it is his responsibility, when he looks at the infrastructure requirements for the expansion of an airport which has seen spectacular growth — his statement said that of Manchester airport—will he ensure that investment will not be denied in favour of speculative growth at Stansted?
I am grateful to my hon. Friend for what he said. I assure him that the question of investment in the rail link to Manchester airport will be taken on its merits, with regard to both an estimate of the build-up of traffic that will occur at Manchester and the environmental desirability of it. It will certainly not be affected or disadvantaged by anything at Stansted.
I congratulate my right hon. Friend on having had the good grace to withdraw the artificial limits on Heathrow movements. Does he agree that that decision is inconsistent with the refusal to grant planning permission for terminal 5 now, which would present a great opportunity to redevelop Heathrow into the next century? Does he agree that Stansted would not be necessary if we had two runways at Gatwick, which the BAA has resisted and that it would be folly to build another international airport with one runway and repeat all these troubles in 30 yèars time?
It is likely that some parts of the Civil Aviation Bill, to which my hon. Friend referred, will reappear in the later legislation. We regard air transport movement limitations both at Stansted and potentially at other airports as something which may eventually be necessary. That was the purpose of the original legislation. I doubt whether my hon. Friend would receive much support from people living in both Sussexes for his suggestion that there should be two runways at Gatwick. There is an agreement between BAA and the county council that that should not happen, and the Government have no plans to interrupt it. It would mean the demolition of a village and major environmental difficulties, and we prefer not to cause that.
I was pleased that the Secretary of State hoped that landing charges for a small airline at Heathrow would fall. I have a particular interest in Humberside airport. In the event of landing charges not falling, what special action will the Secretary of State take to help small airlines to be competitive and to overcome the problems of high landing charges?
At present, the charges that airports levy are entirely within their control. I have no control over them, either at BAA or local authority airports. I propose that, as part of the new regulatory regime for airports generally, the CAA will have power to supervise landing fees and charges. However, legislation will have to come into effect before that can happen. I am sure that the CAA will want to interpret such a new power by stopping the exploitation of a monopoly and ensuring that the charging structure does not discriminate against any type of aircraft or airline.
Although I appreciate my right hon. Friend's attempt to phase the expansion at Stansted, is he aware that an expansion to 15 million passenger movements a year would be wholly unacceptable to the people of Cambridgeshire? In view of his faith in the parliamentary process, may we assume he will encourage his colleagues to allow a free vote if that matter comes before the House? Before any such expansion takes place, why does he not do what the world's airlines want and instead of talking about sludge pits make a firm commitment to a fifth terminal at Heathrow?
I doubt whether a proposal to increase the air transport movement limit at Stansted will come before the House for many years, because we have not yet imposed it, which is the first step. I cannot anticipate the decisions of my right hon. Friends the Leader of the House and the Patronage Secretary about the nature of the whipping on an occasion many years ahead and, perhaps, in a different Parliament, under powers which Parliament has not yet granted—[AN HON. MEMBER: "And a different Minister."] Yes, I accept that amendment.
As to a fifth terminal at Heathrow, we believe that retaining a large amount of room at Heathrow for domestic flights, as many hon. Members have stressed, is important. The result is that the number of passengers is not as great as was expected when Mr. Eyre reported. If it is not terminal capacity, but runway capacity, that limits the use of Heathrow, it would be wrong to embark on building an enormously expensive terminal before there is a clear need for it.
Does my right hon. Friend accept that many will interpret his statement not as one on a national airports policy but as one on an airport policy for the south-east? Many people will be appalled at the perfunctory reference in his statement to regional airports, especially airports in the north. Does he also accept that many people will infer from his statement unfair competition and subsidy by taxpayers for the development of Stansted? Will he explain why a Government who are committed to the operation of market forces cannot allow those market forces to determine the natural growth of Stansted, Manchester or any other airport?
I have not made a precise measurement, but I believe that about one third of my statement dealt with helping regional airports. I would hardly call that a perfunctory reference in what was a long statement. I have given every assurance this afternoon that there will be no opportunity for cross-subsidy to Stansted to the detriment of other competing airports. Market forces will prevail to the extent that it will be for the proprietors of airports, whether Stansted, Manchester or any other to decide whether investments are made at commercial rates of interests.
Thank you, Mr. Speaker.
Does my right hon. Friend agree that the only alternative to the loss of profitable air transport business to continental Europe is to have some expansion in the south-east? Although I understand why those in the affected areas, whether in the south-east or in the regions, are worried, we would all have much more reason to be worried if the Government's decisions resulted in the loss of British jobs and earnings.
I agree with my hon. Friend. The first London airport is Heathrow with 29 million passengers. The second London airport is Gatwick with 14 million passengers. The third London airport is Charles de Gaulle with 13·6 million passengers. The fourth London airport is Schiphol with 10·9 million passengers. The fifth London airport is Manchester with 6 million passengers. Stansted does not even appear on the list.
On a point of order, Mr. Speaker. It will have become apparent to you during these lengthy exchanges that, although there has been strong criticism of the decision, especially from hon. Members for northern constituencies, no Back-Bench Member has supported the Government's policy, especially as it affects Gatwick and the south. Could I trespass on your generosity, Mr. Speaker, and ask you to allow me—
Order. Had the hon. Member who represents Gatwick airport been present, he would certainly have been called. I must protect the other business of the House. It is impossible to call every hon. Member every time. I have gone well over the time that I normally allow—more than an hour—for Back-Bench Members, and I called many Conservative Members. It is unfair to try to raise points of order to continue questions on the statement—
I do not think there is any need to be cross about it; that is what we are here for, is it not? May we have some guidance on the way in which you measure the time that you are prepared to allow on statements? This afternoon, almost a record number of hon. Members rose, but the statement was not allowed a record time.
I cannot give the hon. Gentleman any guidance on that. It is a matter of discretion, and I must make a judgment on the basis of the subsequent business on the Order Paper. The hon. Gentleman would have been deeply offended had he wished to speak in the subsequent debate but had been kept out as a result of my allowing the statement to run over time. On this occasion, the statement began at 3·41 pm and continued until after 5 o'clock, which I believe was a more than generous period.
Further to that point of order, Mr. Speaker. With regard to the point of order raised by my hon. Friend the Member for Ealing, North (Mr. Greenway), will you bear it in mind in future that if there is not going to be a vote on such an extremely important matter, every right hon. and hon. Member who wishes should be given the opportunity to ask questions, especially if they represent constituencies such as mine, which will be adversely affected by the decision? This is probably the most important matter to come before the House this Parliament.
There will be subsequent opportunities to debate the matter at Question Time, and there will be legislation in due course. I have already told the House —I keep my promises in this regard—that those who are unable to ask questions on statements are given preference when we come to debates. In fairness to other hon. Members, I cannot allow questions to continue for ever. If I did, we should never get our business finished.
Further to that point of order, Mr. Speaker. Many hon. Members will know that, for some years, the length of statements has grown considerably, and I believe that you were extremely generous in your handling of the matter today. It is not the privilege of every hon. Member to be called every time he rises. That has frustrated many of us for many years, but you should appreciate, Mr. Speaker, that some of us understand how generous you are. Secondly, on a purely parochial note, we Members from Scotland would like to get on with our business.
I am grateful to the right hon. Member. In deference to those hon. Members who have raised the matter, may I say that I fully understand their anxiety. I am conscious of the fact that they have constituency interests in this matter. There will be other opportunities to discuss it, and hope that they will use them.