18 JUNE 2012

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Article from BTNews 18 JUNE 2012

COMMENT:

Air transport in the news

Inevitably air transport has been in the news over the last seven days with IATA meeting in Beijing, leaks coming from Downing Street that the Government, in the shape of the Prime Minister, may have changed its mind on Heathrow's third runway, and Flybe announcing further losses.  This drowned an important assertion by the Exeter-based airline’s Chairman and Chief Executive, Jim French, concerning APD.

IATA passed off quietly this year, Qatar Airways' Chief Executive, Akbar Al Baker, elected to the Board (see below). 

“No new runway in the South East lifetime of this Parliament” has been the Conservative party policy since coming to (partnership) power two years ago.  It now seems that we could get the third runway, or at least the legal process under way again after another General Election.  Five years would have been lost.  BT News will still continue to promote Northolt as an interim measure.  It could be up and running in 18 months with huge benefits to the regions, a lessening of slot problems at Heathrow, and (former Defence) money in the Government kitty.

In talking about the Flybe financial results Mr French alluded to the situation regarding airport departure tax.  It is what it says it is – a tax for taking a flight from point A to point B, based on the distance between the capitals of each country.   

We, and many others, have said how daft this rule is whereby the APD to Hawaii is less than that to the Caribbean.  It has been pointed out that if the tax was only on distance (and OAG offers the mileage between any two points) there would probably be no loss of revenue to the Treasury, possibly an increase, but at least it would be fair.

Mr French’s point is that if you take a return flight to say Edinburgh from London you pay the APD twice.  A security charge is hidden in your fare.  To Paris you just pay once.  And by subsidised train no tax at all, nor terrorist protection fee.  For domestic airlines this really hurts.  The UK is expensive enough for tourists without having to pay double airport duty if they want to fly to Scotland or Northern Ireland.  Surely under the capital to capital legislation the tax should be zero!

APD is a complete mess and needs a radical overhaul.  Overseas travel agents, we are told, are telling their clients visiting Britain to add a few days on the Continent at no cost.  Take the train to Paris, and fly home direct.  British Airways and Virgin Atlantic miss out.

A Fair Tax on Flying has launched a summer campaign to lobby MPs and the Government over the current levels of the tax – which are now the highest in the world.  The campaign is aiming to attract the support of 100,000 people over the course of the summer. www.afairtaxonflying.org

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