Clause 100 - CAA charges

Part of Civil Aviation Bill – in a Public Bill Committee at 12:30 pm on 13th March 2012.

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Photo of Theresa Villiers Theresa Villiers The Minister of State, Department for Transport 12:30 pm, 13th March 2012

I am grateful to hon. Members for setting out the concerns that prompted their amendments. Although I cannot support the amendments, I hope that I can reassure the hon. Members and respond to the points made.

Amendment 6, moved by the hon. Member for Blackley and Broughton, has one defect that I should highlight. The words “subsection (1)” should not be deleted because if they were, the clause would read, “In (a) omit” rather than “In subsection (1)(a) omit”, and that would cause problems. That is a technical issue, but turning to the substance of the amendment, it would specifically allow the CAA to provide, in a charging scheme to be made under section 11 of the Civil Aviation Act 1982, that providers of air transport using airports regulated by the CAA pay charges to the CAA. I hope that I can reassure the hon. Gentleman. Section 11(1)(c) of the 1982 Act already allows for such a specification to be made if appropriate in a particular charging scheme. The CAA’s power to make charging schemes relates to all its functions under the 1982 Act and remains a general power.

I turn to the concern about instances in which the CAA’s charges are levied on airports rather than airlines. The CAA does levy charges directly on UK airlines, in particular for safety regulation, which is the biggest  element of CAA charges. It is not the case that all charges on the aviation industry are routed through airports, but certain charges are, such as those that relate to complaints handling. I understand airports’ concern about charging schemes in which the CAA includes costs in airport charges so that they are effectively distributed across foreign airlines as well as UK airlines. However, other important considerations must be taken into account, such as the practicality of the CAA collecting small charges of one or two pennies per passenger from airlines based outside the UK. The legality of such an approach might also be an issue. Every airline flying into the UK already has a relationship—indeed, a financial relationship—with an airport. Moreover, some consumer issues in the scope of the complaints-handling process fall within the airport’s responsibility, such as providing assistance for disabled passengers. Some passenger experiences will be affected by both airline and airport actions. It would therefore not be easy or proportionate to break down the costs of consumer work precisely between airports and airlines, however desirable it might be to do so in principle.

I can provide reassurance on amendments 80 and 81, which would require the CAA to consult the Secretary of State after presenting her with a representative summary of the consultation it had carried out on its proposed charging scheme. That is exactly what the CAA has done for every year that it has prepared a charging scheme. For example, it consulted with its stakeholders on its 2012-13 scheme of charges from 5 October to 21 December 2011. It should also be noted that both Virgin Atlantic and British Airways are represented, through the British Air Transport Association, on the CAA’s finance advisory committee, which meets regularly to provide input and comment on the development of the CAA’s charges schemes. The CAA produced a 26-page, 21,450-word summary of the 50 consultation responses and its own response to them, and presented it to the Secretary of State. The shadow Minister was anxious for reassurance on that. The CAA also published the summary on its website, so that those who had responded to the consultation could be reassured that their comments had been fairly reflected. In addition, the CAA sent substantive responses to the Secretary of State in advance, so that she was fully informed of trends. It has therefore adopted exemplary practice. Under clause 100, it will be subject to a statutory requirement to consult the industry on its charging schemes.

On amendment 82, as we have heard, the clause provides that new charging schemes will come into force no sooner than 14 days after publication, instead of 60 days, as under the present scheme. The amendment reflects concerns expressed in airlines’ written evidence to the Transport Committee. The reduction in the period will provide the CAA with an additional six weeks in which to prepare a scheme for publication, which will enable it to use more up-to-date information so that the scheme can be more closely based on the latest statistics and trends. Hon. Members will appreciate the fullness of the 12-week consultation process that the CAA undertakes. They will also understand that stakeholders have ample opportunity to make their concerns known, and that the Minister responsible will have visibility of the issues involved. I therefore consider 14 days to be an adequate period for the CAA between publication of the scheme and its coming into operation.

The proposal to remove the 60-day delay notice period was supported by both the Pilling report and the Safety Regulation Finance Advisory Committee, which represents a significant proportion of individuals regulated by the CAA Safety Regulation Group. The intention behind the 60-day period was to allow the industry to make representations to the Secretary of State. In practice, such representations have rarely been made, so Ministers have never taken action as a result of them. The appropriate vehicle for representations is the consultation processes, which, as I have assured the Committee, the CAA can and does carry out in relation to these important matters.