Regional Airports — [Esther McVey in the Chair]

– in Westminster Hall on 7th July 2021.

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Photo of Esther McVey Esther McVey Conservative, Tatton 9:25 am, 7th July 2021

I remind hon. Members that there have been some changes to normal practice in order to support the new hybrid arrangements. Timings of debates have been amended to allow technical arrangements to be made for the next debate. There will be suspensions between debates.

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We are about to begin. The Minister has now arrived, so I will not ask whether we need to have a short delay, if that is what the Member introducing the debate would have liked to do.

Photo of Steve Double Steve Double Conservative, St Austell and Newquay 9:26 am, 7th July 2021

I beg to move,

That this House
has considered the future of regional airports.

It is a pleasure to serve under your chairmanship, Ms McVey, and a great honour to open the debate on a matter that I feel passionately about. I know many colleagues feel the same, owing to the number of Members who have applied to speak.

I am speaking as chair of the all-party parliamentary group on general aviation and as the MP representing Cornwall airport Newquay. I draw the House’s attention to the fact that my wife, Anne, was recently elected a Cornwall councillor and is now chairman of the Newquay Airport consultative forum.

I am sure we are all aware of the unprecedented impact that the covid-19 pandemic has had on the UK aviation sector. Collapsed demand drove passenger levels at UK airports last summer to their lowest since 1975. In the first quarter of 2021, they were down 94% compared with 2019, and economic output for the air transport sector reduced by 89% between February and March 2020. As a result, many regional airports are losing many millions of pounds in revenue while incurring significant additional debt, leaving them in a perilous financial situation.

Although our national recovery has begun, many challenges remain for the sector. Our airlines and airports face a far longer road to recovery than many other sectors. Even with a successful global vaccine roll-out, 2025 is the earliest date by which the UK is predicted to return to 2019 passenger levels. Furthermore, that recovery is unlikely to be even, with regions outside London and the south-east set to recover far more slowly.

It is crucial that we recognise the role that the aviation sector and, in particular, regional air connectivity will play in our future economy. Pre-pandemic, the sector had an estimated value of more than £28 billion to the UK, and every year almost 80% of inbound visitors reached the UK by air. We enjoy one of the largest aviation networks in Europe and the third biggest globally, with more than 230,000 people working across more than 40 commercial airports.

Regional airports also play a vital role in supporting our national hub airports. Airports such as Heathrow, Gatwick and Manchester rely on routes offering good connectivity to the regions of the UK to provide the passengers for their long-haul flights. In particular, regional airports are vital to the Government’s levelling-up agenda, as they are crucial for economic development across our regions. They give regional communities the connectivity and accessibility they need to be part of the national economic and social fabric, and they allow people from all corners of the country to benefit from economic growth and prosperity.

The UK’s regional airports are a vital catalyst for the economic growth of other sectors, as they facilitate inward investment in the services, products and tourism that support communities to thrive. Newquay airport, in my constituency, is vital to the prosperity of Cornwall and the wider south-west, and it contributed £50 million to the economy in 2015. We witnessed the importance of Newquay airport during the recent G7 leaders’ summit in Cornwall. Given the distances involved and the aircraft that needed to be accommodated, there is a strong case that without Newquay airport it would not have been possible successfully to host the G7 in Cornwall. The collaboration between the Government, Cornwall Council and Newquay airport to fund and deliver the infrastructure required to host the summit in record time is an example of what can be achieved through effective collaboration between Government and regional airports to deliver short-term and long-term value across the UK.

It is therefore right that the Government have intervened with £7 billion of support for the aviation sector during the pandemic, through loans, grants for business rates and the job retention scheme. However, with many of our regional airports in a fight for survival as they bear the brunt of the global pandemic, the Government need to look at providing sufficient ongoing support to keep our regional airports open and planes flying. Many of our smaller regional airports have been hardest hit, will take the longest to recover, and are the least well-resourced to do so. Therefore, we need additional assistance if the economies they serve are to be prevented from falling even further behind during the recovery.

Unfortunately, experience tells us that, once a regional airport closes, all too often it never returns. With developers reallocating the land, large airports such as Heathrow and Gatwick will pull through the crisis—they really are too big to fail—but that is not true of our smaller regional airports. We must therefore protect regional airports now. If we allow them to close, it is likely that the connections they provide and the economic contributions they make to the regions they serve will be lost forever.

I am particularly pleased to welcome the news of a review on cutting air passenger duty on domestic flights, which I and many other colleagues have been advocating for some time. Domestic UK operators bear a disproportionate burden owing to that tax because the charge is levied on the outbound and return journeys. Unfortunately, there has been a loss of connectivity since APD was introduced in 2006, with the tally of UK domestic routes falling by 27%.

Our departure from the EU provides us with a timely opportunity to cut the tax, which would be a critical move to support connectivity across the country and a welcome step to provide some vital relief to the airline industry. When will the Government make a decision on cutting domestic APD? I gently suggest to the Minister that that should be done as a matter of urgency, as one way to support our regional airports.

I am also pleased that, last year, the Government announced the regional air connectivity review as part of their commitment to levelling up the UK. I look forward to any update that the Minister can provide on the review, and he will know it is keenly anticipated by the sector.

I stress the important role that public service obligation routes can play in supporting our regional airports. PSOs could be a vital lifeline for many regions across the UK as we recover from the pandemic, and it is disappointing that the UK has only three PSO routes, all linking to London. That is far fewer than other European countries; for instance, France has around 40. Therefore, I would welcome the expansion of PSO routes to key non-London routes, which would boost the confidence of prospective operators to take on new routes and help with our regional connectivity.

Adding to the importance of our regional airports is their contribution to our transition to net zero—to a cleaner, greener and more sustainable future. Before we can reach the goal of net zero long-haul transatlantic flights, our regional airports will play a critical role in offering short-haul electric flights that are entirely carbon free. For example, I am delighted that the first hybrid electric aircraft will fly between Exeter and Newquay airports later this summer. I am also pleased that easyJet is committing itself to covering short-haul flights with a new electric fleet by 2030 and that Airbus is in the early stages of developing the world’s first zero-emission aircraft.

My view is that, within the next 20 years, as we introduce clean methods of flight, flying will be the environmental transport choice. We are not too far from the opportunity for all domestic flights to be zero emission, which means that one of the biggest barriers to flying—the environmental impact—will be removed. When we reach that point, flying will become the mode of transport of choice for many travellers, but that will not be achieved if we do not have a network of regional airports to serve the whole of our country. With that in mind, our regional airports must be protected to allow us to realise the full potential of the new technology.

It is clear that aviation is still in the midst of the most challenging crisis it has ever faced, which leaves many of our regional airports in a fight for survival. The importance of the industry is evident: better connectivity, greener aviation and a more robust economy. I am pleased that the Government have intervened with billions of pounds to support the sector, but we must recognise the importance of our regional airports and provide them with the support they need to survive the pandemic and to thrive. Greater financial support, reduced APD and more PSO routes are some of the available options that I believe the Government should consider. I urge them to look at such options to ensure that the UK domestic aviation sector can thrive in the years to come and play a critical part in levelling up all regions of the UK.

Photo of Esther McVey Esther McVey Conservative, Tatton

I aim to start calling Front Benchers no later than 10.25 am, and the Minister needs to leave time for Steve Double to close the debate. I call Cherilyn Mackrory.

Photo of Cherilyn Mackrory Cherilyn Mackrory Conservative, Truro and Falmouth 9:36 am, 7th July 2021

It is a pleasure to serve under your chairmanship, McVey, and I congratulate my constituency neighbour, my hon. Friend Steve Double, on securing the debate. Like him, I wish to support Cornwall airport Newquay because it serves the whole of Cornwall, including my Truro and Falmouth constituency. I will echo what my hon. Friend has said, but hope not to repeat too much of it.

Cornwall airport Newquay is a vital part of Cornwall’s transport and economic infrastructure as it provides national and international connectivity to and from Cornwall and the whole south-west. Given the geographical location of Cornwall, which has water on three of its sides, the airport provides a fast and cheap alternative for longer-distance travel, and speed and choice for businesses, residents and visitors. The airport supports a growing and resilient modern transport system for Cornwall. Before the pandemic, our airport was one of the county’s largest employers, employing over 600 people in different roles, including aircraft engineers, air traffic controllers, pilots, firefighters, instructors and so forth.

Aviation is a fundamental driver of international trade, and the connectivity it provides is a key component in delivering national competitiveness and enabling exports. Aviation and aerospace directly support over 250,000 UK jobs. They have been beacons of British engineering prowess for a hundred years, and, as we have heard, they still are. As my hon. Friend described, the aviation sector has unsurprisingly been hugely affected by the pandemic. We have seen countries across the globe shutting their borders and imposing multiple restrictions and regulations, which has meant that the movement of individuals and freight has been curbed. The pandemic is having an enormous impact on the aviation industry and our regional airports. Consequently, there are knock-on effects for the local economy.

In Cornwall, the knock-on effect on tourism, which relies heavily on aviation, is extremely significant. Building public confidence to kickstart aviation in order to aid the economy through tourism, while aiming to stem further job losses in aviation and aerospace, must be a priority. That will be important not only for our continued economic recovery, but for our hugely significant promise to level up the country. Cornwall must be part of that, as it is one of the most socioeconomically challenged counties of the UK. Put simply, Cornwall must not be left isolated, and its airport is key to that.

However, the industry must become environmentally sustainable. Climate change is a clear and pressing issue for us, our businesses and Governments across the world, and we know aviation emissions will increase if decisive action is not taken. I am pleased that UK aviation is committed to achieving net zero by 2050 through taking an international approach by working with Governments around the world, and through the UN. Current circumstances present an opportunity to drive decarbonisation through such an agenda, and the UK is well positioned to become a leader on green technologies, as we have heard, through sustainable aviation fuels and the electric flight that is taking place later this year. That will also create new and exciting well-paid careers for people in Cornwall and in all our regions.

Amid the growing consensus that the global community must act now to avoid the worst consequences of climate change, the UK will host COP26, which takes place in November, and I believe aviation has a full part to play in the conference and in achieving the net zero future.

The industry has taken great strides forward, and electrification and alternative fuels will greatly reduce aviation’s carbon impact. It is important that the research and development momentum and the commercialisation of those technologies from small and medium-sized enterprises are not lost. The UK must be bold. The crucial point here is that technologies continue to develop. UK companies should be encouraged to lead on that activity, and the UK should give clear support to those companies.

The Environmental Audit Committee, on which I sit, is due to launch its inquiry on net zero aviation and shipping before the summer recess. We will agree the terms of reference next week. Although I do not wish to pre-empt the work of the Committee, it is likely that we will want to examine the role, if any, that the Government can take in achieving net zero in this space. So, as they say, watch this space.

The Government must ensure that regional airports such as Cornwall airport Newquay are supported so that they can survive what is a dark period for them. They are essential to connecting people in Cornwall with the rest of country. We should not look to stop aviation travel, as I hear in some quarters, but should ensure that innovation creates a net zero industry in time.

Photo of Jamie Stone Jamie Stone Liberal Democrat Spokesperson (Armed Forces), Liberal Democrat Spokesperson (Defence), Liberal Democrat Spokesperson (Digital, Culture, Media and Sport) 9:41 am, 7th July 2021

It is a pleasure to speak under your chairmanship, Ms McVey, and I congratulate my good friend, Steve Double, on securing the debate. He represents Cornwall at one end of the United Kingdom, and I represent Caithness at the other.

I want to speak about Wick airport. For some time, there has been a question mark over its future, which worries me and everyone who lives in the far north of the United Kingdom. It worries us all a great deal. The point about trying to regenerate the economy of Caithness once Dounreay, the UK’s first nuclear reactor, has been decommissioned is that we have to replace the employment up there. The airport is crucial not only to the present local economy, but to the future local economy of the far north of Scotland.

We all know how enthusiastic the Prime Minister is for a space launch, which I completely support. There was a proposal to have one of Britain’s first space launch sites in Sutherland, close to Wick airport. It strikes me that although we are forging ahead in a good way with a space launch, any question mark over Wick airport would take us in completely the wrong direction. In fact, if we lost Wick airport, that would be a major disaster for the north of Scotland and a big disaster for the United Kingdom, because, as the hon. Member for St Austell and Newquay has said, our chain of regional airports is crucial to the way we run our country and our economy.

For some time, we have been campaigning in the north of Scotland for a public service obligation for Wick airport. To that end, I give credit where it is due. The Scottish Government have offered a sum of money towards that, which is good, and I congratulate a former Member of the Scottish Parliament, Ms Gail Ross, on having achieved it, but that is not enough money to run this.

My erstwhile council, Highland Council, on which I had the honour to serve for a number of years, does not have the deepest pockets in the United Kingdom, but it has, very much to its credit, come up with an offer of £300,000 per annum, but we have a shortfall. So, Ms McVey, my request is simple, and you can imagine what is coming. I would be deeply grateful if Ministers agreed to meet me, and probably Mr Raymond Bremner, chairman of the airport committee, to talk about how we could establish a joint funding package for a PSO that ensured the future prosperity of Wick airport.

This is my final point. If we can increase the flow of passengers through Wick airport, that is good for the economy of the country and it is good for the local economy. Part of keeping the United Kingdom united, frankly, is to have all the airports working with each other across the length and breadth of the country, all the way from Cornwall at the bottom of the country to Caithness at the top of the United Kingdom.

Photo of John Martin McDonnell John Martin McDonnell Labour, Hayes and Harlington 9:45 am, 7th July 2021

I congratulate Steve Double. I represent the constituency in which Heathrow is located, which in no way can be described as a regional airport—I apologise if he feels that I am Zoom-bombing the debate—but I think it is absolutely critical to have a discussion about the need for a new aviation strategy, as a result of the development of regional airports over the recent period.

The aviation national policy statement previously before the House is no longer relevant. Aviation movements have changed. The way in which aviation will be used in the future has changed dramatically. As Cherilyn Mackrory said, we also now have to address aviation’s role in achieving net zero, as well as the impact of the pandemic. All of those factors need to be taken into account in the discussion of the future of regional airports.

The pattern of aviation is changing. We now know that the whole approach on which the last strategy and policy statement was based—with a major hub and a large number of regional airports that feed into that hub—no longer reflects the pattern of aviation. Even Howard Davies, the chair of the commission into the development of Heathrow and the potential for a third runway, identified that in the initial work and has confirmed it subsequently.

For my constituency, that means that we no longer want nor need a third runway at Heathrow, but we accept the need for investment in regional airports, because passengers simply want to fly point to point. In addition, we all want to overcome the environmental impact of aeroplanes coming from regional airports into Heathrow and outwards, which is wasteful and does not do regional economies any good whatever.

It is time for the Government to look at this matter overall. They need to look at a new national policy statement for aviation, which accepts that regional airports play a role in levelling up, of which there is no doubt; that the focus of concentration and investment should no longer be on a major hub at Heathrow and therefore a third runway is no longer necessary; and that if we are going to have an environmental aviation policy, it has to be localised and focus on minimising travel in some forms and, at the same time, on developing the science.

It is important that other hon. Members have time to speak in the debate about their own airports, so I have one final point. It is a plea from all of us for help on the pandemic. We are all hoping that we can come out of the pandemic as rapidly as possible, that people can start travelling again and enjoying their foreign holidays, and that we can maintain the level of jobs in our aviation sector. I still believe that will take some time and we have to be realistic, and therefore, communities that are dependent on aviation, on their local airports and on the aviation sector will need continuing support. I am worried about the run-down and closure of the furlough scheme.

The sector needs special assistance and our communities need longer term strategic support, particularly if jobs are to be shed in the sector. We need to ensure that we have a comprehensive strategy for the workers who will be displaced. That means investment in training and in developing local economies, which will be based on new high-paid, high-skilled jobs, particularly in artificial intelligence and technology, because many of our constituents who work in the aviation sector are highly trained. This is a time to stand back, put in motion some urgent measures to deal with the pandemic and then look at a long-term, stable aviation strategy that contributes to our economy and to tackling the existential threat of climate change.

Photo of Ben Bradley Ben Bradley Conservative, Mansfield 9:50 am, 7th July 2021

It is a pleasure to serve under your chairmanship, Ms McVey, and I congratulate my hon. Friend Steve Double on securing this very important debate.

As has been said, regional airports are key to our economy, particularly for those of us—such as those of us in Nottinghamshire and my part of the east midlands— who are so far from coastal ports. Our rail, air and road connections are key to our vitality and our economy.

The pandemic has had a devastating impact on East Midlands airport. It is the largest pure freight airport in the country, but two thirds of its income comes from passenger travel—short-haul tourism flights—that obviously has not happened for the last 15 months. So, two thirds of the airport’s income as a business has disappeared. Obviously, there has been no sector-specific support for the airport as a business. It has taken advantage of furlough and other general business support to stay afloat. However, given the importance of East Midlands airport to our regional economy, I hope that this week the Transport Secretary will lay out a clearer and much more certain plan for the sector to get moving again. The peak time for tourist travel has already begun and allowing travellers who are fully vaccinated to travel without quarantine, and allowing operators to get flights back up and running, would be a huge boost for the sector.

The key benefit in the east midlands—because, as I have said, we are very far from coastal ports—is the potential to link up a real multi-modal hub for travel around air, and around road and rail links. We can also boost East Midlands airport and its economic potential with improved connectivity if we can get freight onto rail. As I say, East Midlands airport is the biggest pure freight airport in the country. Decisions coming up around the integrated rail plan and the Toton hub in the east midlands will be key, and I am raising those issues with Ministers directly.

East Midlands airport also plays a key role in our wider economic plans, for example our freeport. It is a unique proposition—an inland freeport, based on customs tax incentives that will attract business to our region—but clearly East Midlands airport is the key to delivery of that proposal. I very much welcome the support that East Midlands airport as a business and its chief executive, Clare James, are giving to that plan and the work they are doing in trying to put that business case together and deliver it.

With our development corporation sitting alongside that plan, we have an incredible and highly attractive opportunity to masterplan these sites and to build something positive in terms of future-facing jobs and growth for our region, which will make it a highly attractive prospect for business to invest in. East Midlands airport is key to the delivery of all that.

As I have said, in my part of the country East Midlands airport is vital to our connectivity and our economic growth; it would be hugely challenging to deliver a levelling-up agenda in the east midlands without a strong East Midlands airport. We have the potential through our freeport to play the role in the heart of the country of connecting together other freeports around the UK, and to play a role, as we already do in the region, in central logistics; I think that 90% of the country is within four hours of East Midlands airport. The airport has huge potential, if we can help it to survive these very difficult times and if we can support it as part of our wider economic plans.

A couple of key decisions will be made later this year: the integrated rail plan and planning for our development corporation have the potential to kickstart a huge boost and a huge step forward for our regional economy, if—and only if—we are able to support our regional airports to continue to offer the current £300 million a year gross value added, which is a huge uplift for other businesses, and if we are able to support the 9,000 people who work on site at East Midlands airport. EMA needs certainty on international travel. I hope that in his statement later in the week, the Secretary of State will be able to offer some of that certainty and a boost to our regional airports around the whole of the UK.

In summary, regional airports such as East Midlands airport will be key if the Government are to be able to deliver on the levelling-up agenda, to grow our economies and to create good, sustainable and well-paid jobs in the future. I urge the Minister to do everything he can to support East Midlands airport.

Photo of Catherine McKinnell Catherine McKinnell Chair, Petitions Committee, Chair, Petitions Committee 9:54 am, 7th July 2021

It is an honour to serve under you as Chair, Ms McVey, and I thank Steve Double for securing this important and timely debate.

The UK’s regional airports are important engines of economic development. As an international and domestic transport hub, Newcastle International airport in my constituency is a large regional employer that supports many regional jobs on site, off site and through its supply chain. It supports manufacturing business exports, higher education through its work with our world-class universities and, of course, the tourism sector, which thrived before this crisis. It is a strategic asset for the north-east and is central to our future economic growth but, like many other airports, its future and transition to sustainability is seriously challenged by the devastating impact of the current crisis on international travel, and the Government’s apparent unwillingness to support and understand the special nature of this sector.

We all know the pandemic has taken an especially hard toll on aviation. Between April and December 2020, passenger numbers were down 89.3% year on year. In the first quarter of 2021, they were down 94% on 2019. It has been an absolute collapse. The numbers are not expected to return to pre-crisis levels until at least 2023, in the most optimistic scenario. Although I and colleagues have continually raised the need to support aviation throughout the crisis, the Government still do not seem truly to grasp the special circumstances faced by the sector.

Unlike almost every other kind of business, which we know have all struggled through this crisis, airports are by their nature unable to adapt and diversify their product in a meaningful way. When travel itself is the product and it has essentially been shut down by regulation, adaptation is not an option. The key reason airports find themselves in such tremendous difficulty, however, is because they are stuck with very high fixed costs for the provision and maintenance of infrastructure and services, such as safety and security. They are unable to adjust down their operating costs, let alone their fixed capital costs, to compensate for the low levels of traffic, at a time when they have been effectively shut down by Government.

It is widely accepted that airports are, therefore, looking at elevated costs for the next few years at least, if not longer. With travel demand likely to remain weaker in the short term, due to ongoing restrictions and travel hesitancy, they cannot pass those costs on to airlines, nor would it be fair to do so. A level of ongoing, bespoke financial support to cover those costs should, therefore, be provided by Government, as we transition to the recovery phase.

The airport and ground operations support scheme provides some relief but a longer term and more extensive commitment is clearly needed. Ministers must urgently bring forward the long-delayed aviation recovery plan, and start thinking in earnest about linking the need for ongoing support to our wider goals as a country on climate change and sustainability. The immense problems airports are facing are due to factors entirely beyond their control. They are the result of understandable regulatory interventions from Governments, to prevent the spread of the virus, which include travel bans, traffic light lists and quarantine periods. From the Government’s announcements over the past couple of days, it seems as though aviation will be the sole industry to remain under restrictions.

Ministers like to talk about their £7 billion package of support, but only a very small amount of that has been sector specific. Other European Governments have provided much greater levels of financial support for their aviation industries, and have specifically linked that support to meeting climate goals, something the UK has also refused to do. A big chunk of that Government support will end in two months’ time, when the job retention scheme winds up. That scheme has been a lifeline for aviation workers currently on furlough, along with 51% of those working for tour operators. The Chancellor has been adamant that he will not consider continued sector-specific support for jobs. Unless he has a change of heart, significant redundancies will become stark reality for many in Newcastle, where Newcastle airport is a significant local employer. The loss of expertise will leave us with a less dynamic aviation sector when the recovery comes.

In 20 years, we will look back on the past year as a pivotal moment for UK aviation that will have long-term consequences. The covid-19 pandemic and the Government’s lack of support have crippled airports’ balance sheets. That will have a long-term effect on their ability to invest and create a sustainable future. It may not seem like much of an issue while international travel remains extremely limited, but problems are being stored up for when the recovery comes. The north-east needs Newcastle airport to thrive, to increase global connectivity and to drive our region’s growth and development. We need a clear road map from the Government for the safe resumption of international travel. Particularly if aviation is to continue to remain under restrictions, we urgently need the long overdue aviation recovery plan, alongside a comprehensive package of sector-specific support.

Photo of Jim Shannon Jim Shannon Shadow DUP Spokesperson (Human Rights), Shadow DUP Spokesperson (Health) 10:00 am, 7th July 2021

It is a pleasure to speak in this debate. First, I congratulate Steve Double on bringing forward this debate. Westminster Hall debates offer the opportunity for those with a deep interest to participate, so I thank him for providing the opportunity to do just that.

We need to make no mistake here. I know the Minister understands that; all the hon. Members who have spoken have expressed it and I hope to further express their viewpoint. This is a UK-wide issue because the ripples of difficulties for the airports will affect every community in the United Kingdom, but I will speak specifically about Northern Ireland. I know the Minister has a deep interest in these matters and I am pleased to see him in his place. As a Northern Ireland MP, flight connectivity is vital for me. It is the reason I get here on time and get home on time. Flying over on a Monday or early on a Tuesday morning and flying back on a Thursday night is my routine. If Northern Ireland is to be on a path to fulfilling its full potential, some of that journey will be in the air, through reliable and frequent national and international flights.

Let me put on record my gratitude to the Minister for all his endeavours, his vast knowledge and his interest in this matter. I am not saying that other Ministers do not have that, but it is always good to represent our views to him and to get a response. I am very pleased to see the spokesperson from the Scottish National party, Gavin Newlands and the Labour spokesperson, Mike Kane. They also have a deep interest in this matter and I know they will reinforce the opinion of other hon. Members.

The statistics are clear: aviation is still firmly in the grasp of the worst crisis it has ever faced. Numbers of passengers travelling through United Kingdom airports last summer were the lowest since 1975. My goodness, that is hard to believe. Between April and December 2020, passenger numbers were down 89.3% year on year. In quarter one of 2021, they were down 94% compared with 2019—a drastic reduction in figures and in revenue generated. In the same period, passenger numbers were down almost 89% in London airports, 91.1% in English regional airports, 89.1% in Scottish regional airports, 86.1% in Northern Irish airports and 96.8% in Welsh airports.

Taken together, that meant that the economic output for the air transport sector between February and December 2020 reduced by 89%. That is phenomenal and really shows the magnitude of the pressure on the sector. I am not a wealthy man and I do not come from a wealthy background, but I cannot imagine that anyone other than the very wealthiest in this country could afford to cut their income by 89%. It would be impossible to manage. Yes, furlough has helped and I thank the Government for all they have done with the furlough scheme, the grants and the assistance. But the fact is that regional airports are at crisis point and need help to get through and out the other side, where hopefully we will find ourselves in a better position. We will, but we are all asking just when that will happen.

It is nobody’s fault, either. It is always very easy to point the finger but Government cannot respond to something that is not within their control. I asked the Secretary of State for Transport the other week how we can give confidence to travellers who want to go on holiday. But that is not within his control; it is controlled by all the other countries. It is hard for him to say, “I can tell you what is going to happen and give confidence to your constituents that they can travel to the States or Europe or wherever else they want to go and return safely.” Between April and September 2020, UK airports lost £2.6 billion in revenue, with passenger numbers peaking at 22.1% of 2019 levels in August 2020—up some 11.6% from July, but falling dramatically afterwards. On the current trajectory, summer 2021 will see significantly fewer passengers, meaning airports will lose at least another £2.6 billion in revenue.

We had hoped that we would be coming out of this situation this summer. The Government have set the trend. The Prime Minister’s statement was welcome because, as he said and as the Government’s strategy now seems to be, we need to live with covid and deal with it in such a way that life can hopefully resume as normally as possible. What can we do to alter this situation? We must look at how other nations handle their flight systems and how they treat those coming to their borders who are fully vaccinated. Perhaps the Minister and the Government are seeing a developing trend for how to deal with that.

Regional airports are clear on what they need. The Airport Operators Association briefing puts it well. Support measures should be extended. Office for National Statistics figures show that 57% of aviation jobs are currently furloughed, so the job retention scheme should be extended beyond 30 September for jobs in aviation and travel, or replaced by another grant scheme that supports such jobs beyond that. The restrictions are having an impact on regional airports as well as on international travel—they cannot be divorced. If we in Northern Ireland want to catch international flights, we have to go to Dublin in the Republic of Ireland, or to Manchester or Heathrow. If international flights are cut back, that will have an impact on regional airports and domestic travel.

The airport and ground operations support scheme should be extended beyond 30 September, and the £8 million gap should be removed. Currently, AGOSS provides only minimal financial support of £8 million at most—equivalent to the total business rate bill for airports. AGOSS grants cover fewer than 14 days’ worth of an airport’s operational losses, so they do not last long. Further financial support should be put in place, because airports remain open for critical services. We have to remember that it is not all about domestic travel; it is about the coastguard, the police, the air ambulances and maintenance for offshore oil gas and windfarms, despite near zero passenger numbers. This support should cover operational costs, including those for policing and air traffic, and regulatory costs such as the charges levelled by the Civil Aviation Authority. I gently and respectfully ask that consideration be given to that, because there are things that have to happen for the emergency services and for workers. Jamie Stone referred to that, and I know that the Scottish National party spokesperson, the hon. Member for Paisley and Renfrewshire North, will do so, too.

It is essential that we protect the viability of airports, especially in Northern Ireland, and indeed in all the regions of Wales and Scotland that are hampered by their distance from the mainland. We are very much an integral part of the United Kingdom of Great Britain and Northern Ireland—I am always keen to put that on the record—and as such should be fully integrated in the decision making on the way forward. I join others in asking the Government and the Minister to step up and step out for this sector by providing long-term support in a clear and defined way to ensure viability and connectivity long beyond this debate.

Photo of Gavin Newlands Gavin Newlands Shadow SNP Spokesperson (Transport) 10:09 am, 7th July 2021

It is a pleasure to serve under your chairmanship, Ms McVey. I congratulate Steve Double on securing the debate. He led it very well. I could not disagree with anything he said; in fact, that goes for pretty much every contribution.

The hon. Gentleman spoke of regional airports and regional connectivity being vital to the levelling-up agenda. It is also crucial to other sectors, as I outlined a couple of weeks ago. We have had a number of debates on a similar theme in recent weeks. I will try not to repeat too much of what I have said, but inevitably I will cover similar ground.

The hon. Gentleman also covered PSOs. He can correct me if I am wrong, but I think he said that there are only three in the UK and they are all linked to London. However, that is the English position, because there are a number in Scotland. There are three PSO routes linked to Glasgow—Barra, Tiree and Campbeltown—and a number of other PSO routes are subsidised by local authorities in the Shetlands, Orkneys, Western Isles and Argyle and Bute. As we heard from Jamie Stone, there is a potential additional PSO route to Wick, which I would very much welcome.

Cherilyn Mackrory made a fantastic speech. Sadly and unusually, a number of Members have pulled out of the debate, but other contributors included John McDonnell, who always takes part in these debates, and the hon. Members for Mansfield (Ben Bradley) and for Newcastle upon Tyne North (Catherine McKinnell). And, of course, no Westminster Hall debate would be complete without a contribution from Jim Shannon. He said that we had regional airports to thank for getting him here on time each and every week. I do not think there is any better argument for regional aviation.

As well as being the SNP Front-Bench spokesperson on this topic, I also represent Glasgow airport, which is operating at just 10% of normal capacity at the moment. In addition, we are losing another summer. Let us not forget that, while we talk down here about the school holidays and summer season starting at the end of the month, in Scotland the summer season has been under way for two weeks, and the Northern Ireland school holidays started in the past week or so. The season is already getting beyond Scotland and, to a large degree, Northern Ireland. It is crucial to recognise that.

Glasgow has lost 100% of its long-haul routes, 70% of its international flights and half of its domestic flights. Last year, Glasgow carried 1.9 million passengers—bear in mind that some of last year’s restrictions were not as bad as they are this year—compared with about 9 million in 2019. The last time passenger numbers from Glasgow were this low there was in 1970. Airlines UK has found that without Government support, UK airports will lose around 600 routes as a result of the pandemic. Crucially, it says that some 80% of those lost routes will be from the UK’s regional airports. In other words, the Heathrows and the like will be shielded in the medium term from the worst of the damage.

Given that, and given the long delay in publication, will the Minister confirm when the regional connectivity review will see the light of day? If the Government are genuinely serious about the levelling-up agenda, they must do something to address that specific point. Regional airports, as has been said by many speakers today, drive the regional economies they serve. It is not just about going on holiday. Commerce follows connectivity, and without a meaningful direct route network, Scotland’s place on the world’s stage is at risk, thereby affecting our ability to export and attract foreign direct investments —something we have been incredibly successful at for a number of years. Our successful inbound tourism industry is also at risk.

Pre-covid, tourists were, obviously, spending. Tourism in Scotland generated approximately £12 billion of economic activity for the wider Scottish supply chain and contributed around £6 billion to Scottish GDP, representing about 5% of Scotland’s total GDP. Pre-covid, Glasgow exported over £1.7 billion-worth of goods—more than any other Scottish airport. The majority went out in the belly hold of passenger flights—the very flights we are at risk of losing for good.

There has been much understandable consternation in the industry and beyond with regard to the decision-making process behind the traffic light system. The Government must be more transparent about the decisions they are making regarding why country X, with a potentially lower incidence rate, is on the amber list, while country Z, with a significantly higher rate, is on the green list. Despite what the Secretary of State said during Transport questions the week before last, that level of data is simply not available. The virus is a big enough variable for the industry to cope with—it does not need an even bigger variable in the form of completely unpredictable Government decision making on the traffic light system. The public also need to be convinced and to trust a traffic light system. It has to be said again that the decision to put India on the red list for England was delayed for far too long, and we can see the direct result in our current incidence rate.

One third of on-site jobs at Glasgow airport have already gone, and countless more off-site jobs have been lost from supply chain companies. As I said in this very room two weeks ago, the crucial point is that, such is the cash burn of and outlook for the sector, thousands of jobs have gone while there is a furlough scheme in place. As the Minister knows, jobs in aviation and, indeed, in the wider travel and tourism industry will be decimated in September if the furlough scheme is not extended for those sectors. Not only will that be an economic and social tragedy for thousands of families across Renfrewshire, and perhaps hundreds of thousands around the UK, but the loss in economic output and the cost to the Treasury of short to medium-term unemployment support and associated benefits would be an act of economically illiterate self-harm. There is no pontification or equivocation here—furlough must be extended for these sectors, or many parts of the industry and the hundreds of thousands who work in it face ruin.

The Minister will get up and repeat the sums about the support given to industry. Much of that is furlough, which I and many others of course welcome and which must continue, but in essence the rest is debt, resulting in our airline industry having a much higher debt ratio than much of its international competition, where support, as outlined already, is largely through non-repayable grants. The sum in the USA is £23 billion, in Germany nearly £8 billion, in France £6.5 billion, and in the Netherlands more than £3 billion.

As others have mentioned, limited relief was provided to English airports in November, when the UK Government finally introduced a limited business rate support scheme for the sector. That was seven months after the Scottish Government had announced a similar but more generous scheme in Scotland, where it is not capped and extends to airlines based there, too. Moreover, the Scottish Government moratorium has been extended by a full year, whereas the UK Government’s limited and capped version will continue for only six months. That is clearly an unsustainable position. Will the Minister, in summing up, confirm that an extension is being considered?

Another issue that has hit regional airports a lot harder than the bigger airports was the loss of VAT-free shopping on 1 January, through the scrapping of the extra-statutory concession scheme. I was reminded of that by my hon. Friend David Linden, who travelled through Glasgow airport a bit earlier than me on Monday. He spoke to a member of the duty-free staff who said that, just prior to my colleague going in, they had lost out on £6,000-worth of whisky sales to an individual, because the rules now do not allow for that. That was £6,000 lost in just one transaction.

The result of the Government consultation on the extra-statutory concession was overwhelming. In fact, it was near unanimous, such was the support for the continuation of some form of ESC after Brexit, but again the Treasury ignored those responses. This is yet another revenue stream that helps employ thousands of people across the country and is vital for many airports. Regional airports depend on the revenue from air-side shopping to a far greater degree than the Heathrows of this world. In fact, up to 40% of a smaller airport’s revenue is generated through shopping, as a higher proportion of passengers are flying point to point, rather than domestically through a hub such as Heathrow.

Kicking away that financial structure at a time of huge pressure on the finances of airports is another unnecessary blow to an industry that is reeling from the pandemic, and many regional airports in England are still dealing with the after-effects of the collapse of Flybe. In Scotland, it is estimated that the abolition of the concession will potentially result in the closure of most retail outlets at airports and lost revenue of about £20 million and hundreds more jobs, which neither retail or airports can afford. In fact, in Glasgow five retail outlets and at least three food outlets have closed and will not reopen. The UK Travel Retail Forum said:

“This could be the final nail in the coffin of several UK regional airports.”

The entire industry is on its knees, and I am concerned that the forum is right.

To come to a conclusion, I have made this point recently, such that I sound like a broken record. This is about the 37th time I have asked about support for the aviation sector. That is not just the furlough scheme, crucial though it is, but bespoke support for the sector, which let us not forget is the sector hardest hit by covid. Indeed, we need the kind of bespoke support that the Chancellor and the Secretary of State promised at the outset of the pandemic. I well remember being in the room when the Secretary of State, having claimed to have saved Flybe only to watch it collapse, said to the industry:

“I understand the enormity of what you are facing, and this Government will stand by your side.”

No one in the industry feels that the Government have been by its side. I ask the Minister again: are the Government actively considering a bespoke aviation, travel and tours recovery package? Many sectors that have been far less affected than aviation have had that kind of support.

As I have said, the UK started the pandemic with the world’s third-largest aviation sector, but as one third of that workforce are already gone, it will certainly not come out of this as the third largest. Thousands of people in my constituency alone are losing their jobs. Parts of the industry are on the verge of collapse. As I said two weeks ago, time is running out. We need action, and we need it now.

Photo of Mike Kane Mike Kane Shadow Minister (Transport) 10:20 am, 7th July 2021

It is a pleasure to serve under your chairmanship, Ms McVey, as you are my constituency neighbour.

I congratulate Steve Double on securing this timely debate and on his superb chairmanship of the APPG on general aviation. He was followed by the hon. Members for Truro and Falmouth (Cherilyn Mackrory) and for Caithness, Sutherland and Easter Ross (Jamie Stone)—it was almost Land’s End to John O’ Groats, but not quite. They gave strong defences of their airports, including Wick airport in the north, and spoke of the exciting prospect of the first hybrid flight from Newquay to Exeter.

There have been a few common themes. As ever, my right hon. Friend John McDonnell spoke about the need for continuing support, as did Ben Bradley, who said that there is no sector-specific support. Indeed, those Members will know that 19,000 BA staff are still on furlough. Those section notices have to go out in the next few weeks. We are standing on a cliff edge and something needs to happen.

My hon. Friend Catherine McKinnell spoke eloquently about how uneven the opening-up process of international travel has been. Less than two weeks ago, the Minister got uncharacteristically upset with me when I diverged on policy and said that Labour’s view was to scrap the amber list. We now know that, as The Times reported this morning, the Government will scrap the amber list tomorrow when the Secretary of State makes his announcement, so there we have it.

Following on from the remarks by Gavin Newlands, I am glad that peace has prevailed between our nations. The people’s republic of Greater Manchester and the Scottish nation were almost going to go to war when the First Minister banned us from travelling. Some 2.8 million of us were going to march up the M6 in our City and United shirts, under our Oasis parkas, and stand at the border at Gretna shouting, “Nice one, nice one!” but the First Minister has backed down. That decision alone has cost businesses in my constituency tens of thousands of pounds. I hope that the Scottish Government will now think about adequately compensating business for that, but peace now reigns in our time.

I have listened intently to the debate, and to unions, airports, operators and representatives of the aviation industry. What is clear is that without a genuine sectoral deal, the sector and our regional airports will be in peril. Look back at all that the regional airports have had to contend with over the last few years: the collapse of airlines such as Flybe and Monarch, and of the operator Thomas Cook, which are hugely significant in our part of the world in Manchester, as well as for regional connectivity.

Those low-cost carriers opened up areas such as Southampton, Blackpool, Newquay and Birmingham for business and leisure travellers, and they opened up the rest of the world to the people who live there. Welcoming tourists to those areas boosted the economy, hotels, restaurants and taxi drivers. My hometown is currently hosting the wonderful Manchester international festival. Without Humberside airport, would we have seen such a fantastic event at Hull city of culture? Airports are vital for regional economies.

It is not merely culture and tourism that are affected. I understand only too well the value, economically or otherwise, of representing an airport community. I am sure that colleagues who have spoken to represent their constituencies know how important those communities are when it comes to connectivity, particularly Jim Shannon. I must ask him: do airlines arrange their schedules around his interventions in debates? I really wish to know the answer to that question.

Although the Government repeatedly refer to the package of support that aviation has had, there are some specific industry concerns that do not seem to be recognised at all. The covid pandemic has hit this country and its people hard. We have one of the worst death tolls in the world, and we cannot allow the death of the aviation sector and the closure of regional airports to exacerbate the devastation. The often-talked-about £7 billion package of support, which the Minister will mention in his response, is in the form of loans to the industry—it is debt to the industry. As we move into our lost second summer, the ability to service those debts while being unable to operate is striking fear throughout the industry, and there is the looming spectre of further job losses.

We must consider broader sector-specific support. It is not just about airlines and airports; it is about a whole range of other businesses. My colleagues and I have worked with stakeholders to reach a position that protects jobs, the wider supply chain and—crucially, as we head towards 2050—the environment. The sectoral deal that we suggest is based on six conditions. It will save jobs, tackle climate change and ensure that companies benefiting from the sector support rebase their tax affairs in the UK, which is the patriotic thing to do.

We support global Britain, but we are falling behind the rest of the world. If the Government are serious about rebalancing our economy, they must provide a sector-specific deal. The fund was announced last March, but here we are in July and there is no meaningful restart for aviation. If the Government are to provide confidence for travellers and protect these vital hubs, they have to give us a deal.

My last point—I am sure we are all in agreement—is that we absolutely must rebuild the sector, get businesses going again and get people flying again. As far as possible, we must make this a green recovery. There is no easy way to mitigate the environmental impact of aviation, but whether the green recovery is achieved by reducing fuel consumption, by introducing smarter flight operations and new aircraft engine technology, by modernising the airspace, on which I hope to work with the Minister, or by using sustainable aviation fuels, we must make the industry cleaner and greener. What better footnote to the terrible impact that we have all felt from the coronavirus pandemic than to have our regional airports thriving, with green jobs alongside the other jobs that we previously mentioned? Our regions are crying out for new types of well-paid, highly skilled employment. Let us use this opportunity to save our regional airports and create a greener, sustainable recovery in every region of this nation.

Photo of Robert Courts Robert Courts Parliamentary Under-Secretary (Department for Transport) 10:27 am, 7th July 2021

It is a real pleasure and honour to serve under your chairmanship, Ms McVey. I thank my hon. Friend Steve Double for securing this important debate. He and I have spoken on many occasions—not just about his vital airport, but about regional connectivity in general. He is hugely knowledgeable and passionate. As a consequence, he is an incredibly powerful advocate not just for his local community, but for regional air connectivity in Cornwall and the whole of the UK.

I thank all hon. Members for the varied and excellent points that they have made, and I will do my best in the time available to respond to as many of them as possible. The Government entirely understand and recognise the severe economic impact that the covid-19 pandemic has had on regional airports. They are critical regional and national infrastructure, and we continue to work to understand the industry and to see how it can be best supported at this time. Before I address some of the wider points that have been made, I will say a word or two about Newquay airport, because it is so important to my hon. Friend the Member for St Austell and Newquay.

Newquay airport is vital for connections to the south-western corner of our nation. It connects to nine UK airports, the Isles of Scilly, Faro and Alicante. Newquay airport provided vital access for world leaders accessing the G7 summit last month and, as my hon. Friend rightly says, it was clearly vital to the success of the summit. The £7.8 million provided by the Cabinet Office for infrastructure improvements for the G7 enabled the efficient handling of air traffic and the aircraft that were required for the summit. I am pleased that the works will also ensure that the summit leaves a long-term economic legacy at Newquay airport.

I will be in Cornwall tomorrow as part of the Maritime Safety Week programme. I will be returning from Newquay airport, and I am delighted that my hon. Friend will, I hope, be joining me on a visit to and tour of the airport. We will see again, for ourselves, quite how vital this airport is, not only to him, his area and the constituencies surrounding it but to the whole of the UK. That is because the UK enjoys one of the best connected, best value and safest aviation industries anywhere in the world. The aviation industry creates jobs, encourages our economy to grow and connects us, as my hon. Friend Cherilyn Mackrory eloquently explained, with the rest of the world. It consolidates and expands this country’s position as a dynamic trading nation. That is doubly the case with regional airports.

Regional airports serve our local communities. As Catherine McKinnell vividly explained today, they support thousands of jobs and act as a gateway to the international opportunities to which I have already referred. They maintain social and family ties, and strengthen the bonds between our four nations.

Jim Shannon, as ever, made a wonderful contribution. He explained that regional aviation is vital not only to Northern Ireland as a whole but to his weekly commute. The hon. Member is the personification of the vital economic and social link that regional aviation provides for Northern Ireland and for the United Kingdom.

Prior to the pandemic, the aviation sector directly contributed at least £22 billion to GDP each year and supported half a million jobs in the UK. Maintaining a strong, privately operated and competitive aviation industry is vital to our economy. It supports a truly global Britain and the communities that surround airports.

Mike Kane used a wonderful phrase: “the airport community.” He is absolutely right. He referred in particular to Humberside and, of course, to Manchester, which is so important to him. The phrase “the airport community” could apply, and does apply, to so many of the Members who have contributed to this debate, and to many others who would have liked to have done so.

I would like to dwell for a moment, Chair, on some of the points made by my hon. Friend Ben Bradley. He made powerfully clear the importance of East Midlands airport to his constituency and region. Regional airports are vital for levelling up. They enable local communities and businesses to connect with London and beyond. They play a key role in levelling up our regions and building global Britain. It is absolutely vital that that air network is maintained, because it is key to achieving positive and growing economic outcomes for our regions. Our objective is to ensure that all nations and regions of the UK have the domestic and international air transport connections that local communities and businesses rely on, while of course ensuring that we meet our net zero commitments. I will come to that in a moment.

The importance of this regional aviation network has been seen as never before during the covid crisis. Although it has clearly impacted regional airports across the UK, and the airlines that operate out of them, the sector has continued to perform well and has adapted despite the challenges. We have spoken of Newquay already. The Newquay to London route is operating during the summer, as commercial operators are offering enough flights to be able to meet the demand for staycations. We have heard that the G7 summit was facilitated by that.

As of last week, a new route began operating from Teesside airport to London Heathrow. It will link passengers from Teesside, via Heathrow, to 134 destinations throughout the world. We have seen vividly over the course of the last year that the sector has adapted to provide critical support during the pandemic. For example, aviation freight has been vital for getting the amount of personal protective equipment the UK has needed, both through airports that are freight specialists and through passenger airports that also deal with a heavy amount of freight. My hon. Friend the Member for Mansfield has clearly explained the importance of East Midlands to his region, and Birmingham airport has also stepped up to provide more red-list terminal capability and capacity.

Photo of Gavin Newlands Gavin Newlands Shadow SNP Spokesperson (Transport)

The Minister has made a very good argument and case for regional air connectivity, so can he tell us if and when the regional air connectivity review will be published?

Photo of Robert Courts Robert Courts Parliamentary Under-Secretary (Department for Transport)

I shall return to the hon. Gentleman’s points, but on that point, in brief, we will look to publish that regional connectivity piece as part of the strategic framework for recovery of the sector that we will publish later this year. I will come on to some of the regional connectivity review points in a little while, but that is the brief answer to his question.

I would like to say a word or two about the wider use of airfields, the diversification of them, and the ability for airports and airfields to provide highly skilled, dynamic and innovative businesses with opportunities to grow and flourish. That involves things such as the maintenance of aircraft, manufacturing, aviation services, and research and innovation. Airports and airfields are not just vital for their local economies, but critical to the success of the aviation sector more broadly. My hon. Friend the Member for St Austell and Newquay of course chairs the APPG on general aviation and will know how important they are for that. I know that he shares my passion for that.

My hon. Friend the Member for Truro and Falmouth spoke about the use of commercial airports for aerospace or military aerospace. There are of course many examples all over the country, but Cobham at Teesside airport is one that immediately springs to mind. Then there are regional airports that have diversified into other, additional functions—things such as pilot training. Oxford airport, just outside my own constituency, is a powerful example of that. Perhaps the most vivid example of all is Newquay airport in hosting a spaceport.

The hon. Member for Strangford pointed out that many services need regional aviation. He rightly referred to search-and-rescue helicopters, to police helicopters and, of course, to oil and gas maintenance and facilitation. The mixed use of aviation and airspace is absolutely vital, going far beyond the immediate core vital function that we have spoken about today.

I would like to say a word or two about route support and PSOs—an issue raised by a number of hon. Members, including of course my hon. Friend the Member for St Austell and Newquay but also Jamie Stone and Gavin Newlands, who spoke just a moment ago. The hon. Member for Caithness, Sutherland and Easter Ross had the wonderful phrase “from Cornwall to Caithness”. I suspect that other hon. Members might wish to add some stops en route, so that we have Cornwall to Caithness via Manchester, via Glasgow and via Belfast, for example; there are many other places. His phrase was wonderful; I apologise to him for having mangled it in the course of including other hon. Members. His essential point, that regional aviation covers the country from Cornwall to Caithness, is of course a very important one.

We continue jointly to fund public service obligation routes from, for example, Londonderry and Dundee into London, protecting air connectivity from some of the most far-flung parts of the UK. We are, as I have stated already, very pleased that commercial services have operated between Newquay and London over the summer and will continue until the end of October. We are working closely with Cornwall Council to ensure that air connectivity on the route can continue beyond the end of the summer season.

I recognise, of course, the significant impact that covid-19 has had on regional airports, airlines, economies and connectivity. We will consider whether there are further opportunities to utilise PSOs alongside other policy measures that look towards meeting our ongoing regional-connectivity and levelling-up objectives.

The hon. Member for Caithness, Sutherland and Easter Ross asked to meet me about Wick airport. Of course I would be delighted to meet him to discuss that and any other issue that he may wish to discuss with me. He will of course realise that if a PSO is considered to be intra-Scotland, the Scottish Government would be the right place for him to direct his inquiries, but of course I am happy to work with him to see what more we can do to strengthen regional aviation in his part of the world.

A number of Members mentioned air passenger duty. Of course, as part of its plan to boost regional connectivity to support the commitment to net zero by 2050, the Treasury launched a consultation on aviation tax reform that explores reforms to air passenger duty. It is an area often cited by the sector as a barrier to domestic connectivity. That consultation has set out the Government’s initial policy position that, following our departure from the EU, the effective rate of APD on domestic flights should be reduced. The consultation closed on 15 June. The Treasury is now considering responses and will give an update on response timings in due course.

I have already briefly referred to the regional connectivity review, in answer to the hon. Member for Paisley and Renfrewshire North. The Union connectivity review by Sir Peter Hendy is under way and will be published later this year. That will explore how improvements to transport connectivity between the four nations of the United Kingdom can continue. That is independent of Government and is expected to examine various modes, including air links.

A number of hon. Members rightly mentioned decarbonisation: my hon. Friends the Members for St Austell and Newquay and for Truro and Falmouth, and the hon. Member for Wythenshawe and Sale East, in particular. The Government have introduced a wide range of measures to support the decarbonisation of the aviation sector, including a £15 million competition to support the UK production of sustainable aviation fuels—SAF, as they are called—and the introduction of the UK’s emissions trading scheme, which is 5% tougher than the EU equivalent, and covers all domestic and UK to European economic area flights. In June, we launched the first round of the £3 million zero emission flight infrastructure competition, supporting the development of the infrastructure that is required to aid electric and hydrogen aircraft. That will help to build the UK airports and airfields of the future.

The UK’s domestic aviation sector is well placed to be at the forefront of decarbonisation. I welcome the recent announcement from Loganair that its operations will be carbon neutral by 2040, to be achieved through the use of SAF, hydrogen and battery-electric propulsion, as technological advances allow. The Government will shortly consult on our jet zero strategy, setting out the steps that the sector will need to take to achieve net zero by 2050.

A number of hon. Members asked about the future, the recovery of the sector and the strategy: my hon. Friend the Member for St Austell and Newquay, the hon. Member for Newcastle upon Tyne North and John McDonnell who was not Zoom-bombing—his contributions are always very welcome, whether on Heathrow, the green recovery or any other matter concerning aviation. We will be looking ahead for the sector and will need to set out the path for recovery in a way that supports not only the aviation market but the wider objectives of levelling up and building back greener.

We are working on the strategy for the future of aviation in the UK, to be published later this year. It will explore the sector’s return to growth, including workforce and skills, aviation noise, innovation and regulation, consumer issues and, critically, regional connectivity, as I have explained. It will also consider climate change and decarbonisation, as well as the critical role that aviation plays in retaining the UK’s global reach. As I explained, the strategic framework will be published later this year.

There is no doubt that the pandemic has had a devastating impact on the UK’s aviation sector but regional connectivity and regional airports are a vital part of it, and we are committed to ensuring that they are at the forefront of Government plans to help the sector to recover. The Government are always keen to engage with aviation stakeholders to find ways to ensure the swift recovery of the sector.

Although uncertainty remains in the path ahead, we are committed to this world-leading aviation sector, both its international and regional parts. We will ensure that the sector has the tools it needs to return and grow in a safe and sustainable way. I thank all hon. Members who spoke for such an excellent, wide-ranging, highly knowledgeable and helpful debate on this critical topic.

Photo of Steve Double Steve Double Conservative, St Austell and Newquay 10:43 am, 7th July 2021

I thank all hon. Members for their contributions to the debate. The level of concern and commitment to our regional airports from colleagues across the country is clear. I also thank the Minister for his comprehensive response. I know he shares our passion and commitment to regional connectivity. I hope he continues in his role for a long time, because we have someone who champions aviation. There was a clear message from all contributions, and I know from his response that the Minister gets it.

We are at a critical moment for our regional airports. The impact of the pandemic, on top of a fairly tough environment even before the pandemic with the collapse of Flybe and other factors, means that we need to do all we can to support them. I acknowledge and welcome the Minister’s comments about the Government’s determination to support the sector going forward. There is no time to be lost, particularly with the phasing out of the furlough scheme. We need to see something come forward sooner rather than later for those jobs and businesses. As many hon. Members have commented, there are so many different businesses that support our regional airports. They need to know what the support will be going forward, so that they are able to plan for the immediate future as we emerge from the pandemic.

This has been an excellent debate. I thank everyone who has contributed. I am sure we will continue to engage together and with the Minister to champion each of our regional airports and the vital role they play.

Question put and agreed to.

Resolved,

That this House
has considered the future of regional airports.

Sitting suspended.