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Rates of Air Passenger Duty

Part of Clause 9 – in the House of Commons at 8:45 pm on 11th March 1997.

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Photo of Alistair Darling Alistair Darling Shadow Chief Secretary to the Treasury 8:45 pm, 11th March 1997

I am happy to do that, because I was about to come to the opportunism of the nationalists in respect of the present amendment. I have a suggestion more helpful than amendment No. 22, tabled by the hon. Member for Banff and Buchan, with which I have not yet dealt.

Some parties claim that it would be a great step forward if the Government were defeated on amendment No. 7, but £415 million is a lot of money. Although other Opposition parties do not have to concern themselves with this problem, we have to concern ourselves with the possible loss of revenue and with a problem that any future Government will have to face: dealing with the economic situation that we actually inherit, not one that we might like to inherit.

The hon. Member for Banff and Buchan wants to exempt people who travel to and from airports covered by objective 1 status. The problem is that objective 1 funding is to be reviewed, starting this year and coming into effect from 2000; so we do not know at this stage which areas may be covered. I agree with the hon. Member for Orkney and Shetland (Mr. Wallace) that it would be hard for people living in Manchester to find that Liverpool airport was covered but Manchester airport was not. I understand exactly why the hon. Member for Banff and Buchan included objective 1—it covers the highlands and islands and, by a happy coincidence, it also covers the area represented by the Ulster Unionists.

The Labour party, possibly together with some Conservative Members, recognises the problems associated with highlands and islands flights. As my hon. Friend the Member for Western Isles said, these are lifeline services, especially for health. They are a much quicker way of reaching other parts of Scotland, the United Kingdom and Europe. Ferry travel can often take hours and sometimes days to cover the same distance.

The hon. Member for Banff and Buchan said that we are talking about only £2 million. Supposing we had that £2 million; we would then have to decide whether to use it by forgoing airport passenger duties in the highlands and islands or whether to use a similar sum to subsidise, for instance, freight going to and from the islands. All the transport costs involved in transport between the highlands and islands and the rest of Scotland need to be looked at.

I therefore believe, as do the Government to some extent, that we need to examine how best the Government can support air and sea transport to and from the islands. The whole issue needs to be looked at strategically to determine how best we can assist the islands with the resources available to us. That is far more constructive than looking at any one item in isolation.