| SSE NEWS ARCHIVE - July to September 2012
LIB DEMS VOTE AGAINST SECOND STANSTED RUNWAY
Sinead Holland - Herts & Essex Observer - 25 September 2012
LIBERAL Democrats have reinforced their objections to a second runway at Stansted Airport.
At the annual conference in Brighton this week, members voted on a motion proposed by Julian Huppert, the MP for Cambridge, outlawing further infrastructure expansion at the Uttlesford hub, Heathrow and Gatwick.
The motion calling for better use of existing capacity instead has now become a part of Lib Dem party policy.
Speaking from the conference, Uttlesford Lib Dems' environment spokeswoman, District Councillor Elizabeth Parr, said: "At a time when senior figures in the Conservative party are calling for Stansted expansion, this reaffirmation of the Liberal Democrats' opposition to more runways is good news for local residents. Heathrow handled a big increase in passenger numbers during the Olympics, which shows there is no need for any more runways."
STANSTED AIRPORT'S BOSS IS READY FOR TAKE-OFF
Sinead Holland - Herts & Essex Observer - 25 September 2012
STANSTED'S managing director Nick Barton has an optimistic message for potential owners: "It's a fantastic time to buy an airport."
For an investor with around £1billion to spend, he believes the Uttlesford low-cost hub is an impressive piece of real estate, perfectly located to capitalise on an economic upturn he senses has already started. As boss of the region's biggest single site employer, an important part of his job is talking to industry leaders and Mr Barton - although cautious - said confidence was undoubtedly growing.
Stansted is home to 199 firms with a total of 10,200 workers, including 1,420 BAA employees. Despite the distraction of selling, he and the airport's management team are determined to continue supporting the local economy with events like Thursday's (September 27) Meet the Buyers forum - a speed dating event for businesses which last year generated deals in the East of England worth an estimated £1.5m.
He said: "We have absolutely no doubt in our own minds about confidence in the UK economy and Europe being a key determinant of Stansted's performance." Passenger numbers have slumped from a high heading for 25m to just under 18m this year.
Mr Barton said: "Despite where we have been for the last five years, we are starting to feel some benefits in the business and starting to see stability coming back into the airport. It's a fantastic time to buy Stansted Airport... The future, for the first time, is starting to look a lot brighter."
While rumours abound that the sale of the airport is already a done deal, Mr Barton denied any contracts had been signed and refused to speculate on the specific identity of interested parties, but he and finance director Pablo Andres are already immersed in the paperwork for a potential deal and expect to be so for some time.
Names in the frame range from Stansted's biggest airline Ryanair, said to be considering a 25 per cent stake, to latest contender, New Zealand's Morrison and Co as a serious rival to any bid from Manchester Airports Group.
While he acts as an international estate agent, running through the particulars for big bucks investors, he has made sure the rest of the board concentrate on keeping the routine running of Stansted on track and reassuring staff. He said: "It's more important than ever to make sure that the performance of the airport and its day to day operation are not affected. The message going out to staff is that the very best thing you can do - and the sale does create uncertainty - is to improve your performance. Then everyone is a winner."
He understood the speculation which has linked the sale of Stansted with a fistful of global players: "There's no question there's been an awful lot of debate and interest. It's right and understandable there's going to be talk about the airport. For us as a business though, we have to approach the sale in a very structured way. It will take months to do, producing very complex documents."
He refused to reveal BAA's timetable: "We have set our own targets... because we want to ensure any uncertainty is kept to a reasonable minimum."
The decision to sell comes after a three-year battle against the Competition Commission's auction order. However Mr Barton pointed to the sale to Spanish construction giant Ferrovial in 2006 and said: "I'm pretty relaxed about it... the fact it (ownership) is changing once in six years is not a significant concern."
For now he said the message from his Continental bosses was clear: "Business as usual." The Spanish giant has invested a massive amount in Stansted and continues to do so - with an ongoing £400,000 weekly capital investment. He hoped that long-term view would be shared by a new owner and was confident BAA's work in the business and local community, particularly its charity contributions, would also continue.
"We would not expect any future owner to have a different view. We are excited about the change and look forward to it - it doesn't give us any cause for concern, but that's not any reflection on Ferrovial's stewardship. We look forward with excitement - and back with fondness. Ferrovial were excellent at allowing the management team to deliver what they thought was in the best interests of the airport. They have never once queried the capital plan for the airport. They absolutely take the view that when you are going into a sale, the best thing you can do is make the airport even better."
He was clear: "The future of Stansted is potentially amazing."
LIB DEMS REJECT 'BORIS ISLAND' PLANS
AND SAY NO TO HEATHROW THIRD RUNWAY
London24 News Online - 23 September 2012
Liberal Democrats have voted overwhelmingly to reject London Mayor Boris Johnson's plans for an airport in the Thames Estuary. And the party also sent a strong message today at their autumn conference to their coalition partners that they were "not for turning" on the issue of building a third runway at Heathrow.
Dr Julian Huppert, Lib Dem MP for Cambridge and co-chair of the Parliamentary Party Committee on Transport, told members it was time for the party to set out an aviation policy which "balances the need for growth with the clear environmental threat that we face".
He said: "Aviation is the fastest-growing contributor to our emissions, we simply must not build airport capacity which would force us to miss those carbon reduction targets, it's as simple as that."
Dr Huppert claimed passenger numbers could be increased without building new runways anywhere in the country, arguing there was space at existing airports in the UK, including Gatwick, Stansted, Birmingham and Manchester which had usable capacity.
He said: "We don't need to build new capacity, we need to use it better."
There was a "clear need" for Britain to have a global hub airport in order to remain competitive and the party should look for a better option, Dr Huppert said. He added: "Our long-term vision is a new hub if we can find somewhere that's better than we already have, but only if we close other runways to make up for it, so there's no net increase in runways or total capacity."
"Boris Island", he argued, was "not a proper suggestion", adding: "It is, simply put, a bad idea. The location is wrong, the cost too high, the environmental damage too great, and that's just the start of the problems."
Dr Huppert turned his fire on Labour, claiming they did not have a policy on Heathrow and branding them "irresponsible in government, irresponsible out of government". He also criticised his party's coalition partners over their aviation policy, saying the Conservatives "were wavering all over the place, their party is astonishingly divided".
Lib Dem Transport Minister Norman Baker said if a third runway at Heathrow was built it would generate more extra carbon emissions each year than Kenya and cause "untold extra misery" for hundreds of thousands of people in west London. He said: "Now it seems some Conservatives are buckling as well - well the Lib Dems are not buckling. We said in our manifesto we were against a third runway, we said it again in the coalition agreement and I'm saying it again today: There will be no third runway at Heathrow on our watch."
Mr Baker said he was determined to see aviation prosper, but not at any price, and that the environment should be respected through a sustainable aviation policy. The motion backed by a majority of members calls for the UK to make best use of existing capacity and improve transport links at current airports. It also recommends an independent, evidence-based study to find a suitable location for a hub airport, or a suitable airport to expand into a hub, with no net increase in the number of UK runways and greater recognition of serving the north and south.
It also included agreed amendments to reject all plans to build an airport in the Thames Estuary and to end night flights at Heathrow between 11pm and 6am except for emergencies.
HOW TO MAKE A RUNWAY OUT OF A MOLEHILL
Simon Calder tours the villages facing a date with the bulldozer
if airport expansion is cleared for take-off
Simon Calder - The Independent - 15 September 2012
Two of the most powerful figures in aviation have demanded urgent airport expansion in South-east England - reawakening the spectre of demolition in communities bordering on Heathrow, Stansted and Gatwick.
Michael O'Leary, chief executive of Ryanair, told The Independent that expansion at Stansted is essential: "A second runway would account for all the growth you need in the South-east for 10 or 20 years."
Stansted's current owner, BAA, withdrew a planning application for a second runway shortly after the last election. But the Essex airport is up for sale, and Ryanair has expressed an interest in taking a stake. Mr O'Leary said that if his airline were part of the successful bid, he would plan to "Grow it like gangbusters".
Keith Williams, chief executive of British Airways, told the Aviation Club: "The goals of more capacity and connectivity are not the demands of the aviation industry. They are the demands of the British economy." He added: "This is a nettle which should have been grasped long ago." While Mr Williams stopped short of calling for a third runway at his airline's main base, BA has lobbied intensively for expansion at Heathrow.
The Coalition has ruled out any additional runway in the South-east for the lifetime of this parliament. But in the reshuffle, Justine Greening - the strongly anti-expansion Transport Secretary - was moved, paving the way for a new runway to be announced soon after the next election. David Cameron has appointed the former head of the Financial Services Authority, Sir Howard Davies, to chair an independent commission on airport capacity. It will report in the summer of 2015 - meaning at least three more years of uncertainty for the communities alongside London's three biggest airports.
At Stansted, the village of Molehill Green would be demolished. Les Pratt, a retired carpenter and local resident, said: "We chose to move here because our son and our grandchildren live just round the corner from us. I would try to oppose expansion with whatever I could do within the laws of the land."
Peter Sanders, chairman of Stop Stansted Expansion, said: "This weakening of the Government's position is regrettable, indeed deplorable." But he added that he expected the new commission to draw the same conclusion as a 1980s report, that an extra runway at Stansted would be: "An unprecedented and wholly unacceptable major environmental and visual disaster."
Across at Sipson - a village that would be largely flattened to make way for a third runway at Heathrow - a hand-painted banner has been strung across the fence guarding an empty patch of land, reading: "BAA don't bully Sipson families 4 profit".
The proposed third runway would be suitable only for smaller, short-haul aircraft. Its western extent is limited by the 15th-century Harmondsworth Barn, which Sir John Betjeman called the "Cathedral of Middlesex". It is adjacent to a church and pub, the Five Bells, which would also be spared. The landlady, Michelle West, said: "Once the recession passes it's all just going to come back again - but there would be a hell of a fight."
A local resident, Jo Ryan, said: "The village will be cut off so it will die anyway. The school will be closed because of the aeroplanes. It wouldn't be feasible to have children in the school because it would be too noisy".
A spokesman for Heathrow's owner said: "We welcome the Government setting up an independent commission to look at hub airport capacity. It's vital to the UK's future that we examine objectively the pros and cons of all options. It's also vital that there's cross-party consensus over the commission ? so whichever party wins the next election, its recommendations will be implemented."
Pro-expansion campaigners at Gatwick claim that a new runway at the Sussex airport would cause far less disruption than the options at Heathrow and Stansted. Jeremy Taylor, chief executive of Gatwick Diamond Business, said: "We've got the least number of affected households affected by a 'land-grab', and we have the access by rail and motorway."
An agreement signed in 1979 with West Sussex County Council prevents the construction of any new runway before August 2019. Gatwick's chief executive, Stewart Wingate, said "We recognise and respect that agreement. However, like any responsible business, Gatwick looks ahead into the future and thinks about what might be needed to continue to run a successful operation". A tranche of land south of the existing runway has been safeguarded in case of future expansion.
The Gatwick Area Conservation Campaign has long argued that: "It makes no sense to expand Gatwick so as to attract more passengers from the north. A new runway won't work before 2019, and it won't work after 2019."
Given that no decision is likely before the end of 2015, and the time likely to be taken for the planning process, the restriction looks increasingly irrelevant. Meanwhile, the bookmaker Ladbrokes is quoting odds of 7-1 for a third runway to be in use at Heathrow before 2020. When Michael O'Leary was asked by The Independent whether his airline would fly to Heathrow if a third runway was built, he said: "No, I suspect I'll probably be dead."
MORE AIRPORT CAPACITY NEEDED TO MAINTAIN 'DECENT STANDARD OF LIVING', SAYS BA CHIEF KEITH WILLIAMS
Many in the aviation industry believe the ousting of Justine Greening
as Transport Secretary in the last reshuffle was triggered by her
strong opposition to Heathrow's expansion
David Millward - The Guardian - 14 September 2012
Successive governments have failed to grasp the issue of airport growth, Keith Williams told a gathering of leading aviation industry figures in London.
"The goals of more capacity and connectivity are not the demands of the aviation industry," Mr Williams said. "They are the demands of our society's ambition to sustain a decent standard of living for every citizen in decades to come, when Western countries will cease to enjoy the in-built economic advantages over the rest of the world which came so easily in the last century." Mr Williams' remarks reflect the growing frustration in aviation circles over the Coalition's handling of airport policy.
On taking office, the Coalition scrapped Labour's plans for additional runways at Heathrow and Stansted. Since then it has first produced a "scoping document" for aviation policy last year, followed in July by a "policy framework". In addition it established a so-called task force to examine "quick wins" to improve airport performance in the South East. In its latest initiative, unveiled last week, it announced a commission to investigate aviation policy, headed by Sir Howard Davies, the former head of the Financial Services Authority.
"This is a nettle which should have been grasped long ago. I wish Sir Howard Davies well in his forthcoming deliberations," Mr Williams said. "However relaxed the deadlines set for him, time is not on the country's side."
The establishment of the Davies commission, which will report in 2015, triggered speculation the Tories are prepared to ditch their 2010 election pledge to block a third runway at Heathrow.
Many in the aviation industry believe the ousting of Justine Greening as Transport Secretary in the last reshuffle was triggered by her strong opposition to Heathrow's expansion. Mr Williams' intervention came as the all-party Transport Select Committee announced its own inquiry into aviation strategy.
EXPANDING STANSTED IS THE LEAST WORST OPTION
Steve Norris - The Times - 13 September 2012
Heathrow is unacceptable, the estuary hub is unworkable, but Crossrail transforms the choice for London's airports. Alongside the Olympics the biggest story of this summer has been the saga of runway capacity in the South East. Boris Johnson accused the Prime Minister of sacking Justine Greening to reinstate the prospect of a third runway at Heathrow, while the veteran Tory MP Tim Yeo told David Cameron that his decision would prove whether he was a man or a mouse.
Actually, the mistake was not to move the excellent Miss Greening to International Development but to appoint her as Transport Secretary in the first place, knowing that the MP for Putney had admirable form as an opponent of Heathrow expansion.
And nor is this about prime ministerial cojones. Twenty years ago as a minister in the Department of Transport I was given the RUCATSE file, (the acronym for Runway Capacity in the South East). If Patrick McLoughlin, the new Transport Secretary, wants to save some money he could simply dust it off and change the date. No one would notice because nothing has changed, either under the previous Tory Government or under 13 years of Labour.
No additional runway is ever going to be welcomed wherever it emerges. It will be furiously opposed by environmentalists in principle and local people for perfectly legitimate reasons. But this is a case where the national interest must come first. It has never been more necessary for Great Britain to sell itself to the world - particularly to the enormous emerging markets in Asia and South America. We cannot wish away the need for more aviation capacity.
Yes, high-speed rail to the Continent and in this country can improve connections. Video conferencing technology is now brilliantly good and will be a significant consideration for business people who do not want to travel long distance or give up the best part of a week for the sake of a single half-day of negotiation with their Chinese counterparts. But there is ultimately no substitute for personal contact. So accepting that no runway is welcome and that any decision will be hugely contentious, we urgently need to pick the least worst option.
London is served by six airports and if passengers spread themselves evenly across them there would arguably be no need for additional capacity - at least not for several years. But international air travel increasingly revolves around major hubs. The bigger the airport, the more airlines are represented and the more destinations served.
To stay as the preferred European hub Heathrow - by far the largest of the six - needs to grow. That is the argument advanced by, among others, the Tory MP Kwasi Kwarteng who admits that if that argument is followed to its natural conclusion not only should a third runway be added, but also a fourth.
It is a powerful argument, attractive to business users but completely unacceptable. Heathrow is simply too close to London. The third (short) runway would not only mean an increase in flights low over the city with all the pollution and noise that implies, but would effectively obliterate a village. A fourth would raze thousands more homes to the ground. It is a ludicrous proposition and all parties have been right to oppose it.
But is a single hub so critical to success? New York's 110 million passengers use two - Newark and JFK. Why can't London with 135 million do the same - particularly if they were linked directly by a fast, comfortable rail link. That is why the obvious answer is Stansted. Largely ignored by its current owner, BAA, and poorly served by rail, Stansted, 30 miles north east of London, has been the poor relation of the big three airports. BAA now has to put the airport up for sale. Michael O'Leary of Ryanair is said to be among the likely bidders.
But Stansted could turn out to be BAA's sale of the century because of the advent in five years' time of Crossrail. This line links east and west via a tunnel under the heart of London. It joins the City and Canary Wharf to Heathrow and transforms Farringdon and Smithfield. But it can do more.
From east of Stratford a 10-kilometre rail tunnel spur emerging at Fairlop Water and following the line of the M11 could link Stansted directly to Central London and take passengers to Heathrow without changing trains. There is the capacity for six trains an hour, more than the Heathrow or Gatwick expresses. Journey time to Tottenham Court Road or Bond Street would be around 40 minutes. And all for around £5 billion.
Compare that with the estuary hub plan (Boris Island, as it is known). Not only does it require the closure of Heathrow - something that Willie Walsh, the outspoken boss of IAG, which owns BA and Iberia, has condemned as undeliverable; but it is predicted to cost £50-£100 billion. In truth the scheme is a brilliant CGI but unworkable in practice. Its flight paths would conflict with existing Schiphol holding patterns and the proposal is very light on transport details beyond a broad statement that there would have to be new rail and road connections. It is not going to happen.
Our planning system is still far too slow for major infrastructure projects and this Government's Localism Act has made things worse. But there is a solution that Mr Cameron should seize with both hands. One of the previous Labour Government's welcome initiatives was the introduction of National Policy Statements (NPSs) approved by Parliament, to cover exactly this sort of strategic issue. They ensure that public examination concentrates on local issues such as fair compensation.
A number of these NPSs have already been published but predictably not the one on runway capacity in the South East. The Government should make this a priority, conduct a reasoned and, no doubt, passionate debate on all the options and then do what Parliaments are surely there to do - make a clear decision in the interests of the nation as a whole. I believe they should decide that Stansted should be the location of additional runway capacity over the next three decades at least. But whatever they decide, the time for kicking the can down the road has gone.
Steve Norris was Minister for Transport 1992-96 and chairs the National Infrastructure Planning Association
OUR COMMENT: Mr Norris would seems to be in danger of creating traffic chaos on cross rail with 6 extra trains an hour arriving from a yet unplanned tunnel from Stratford as well as more problems on the existing Stansted line. Neither would another runway be any more welcome or justifiable at Stansted than it was in 2009!
MANCHESTER AIRPORTS GROUP CONFIRMS INDUSTRY
FUNDS MANAGEMENT SALE IF STANSTED AIRPORT
ACQUISITION GOES AHEAD
Manchester Evening News - 11 September 2012
Manchester Airports Group has confirmed it will sell a 35 per cent stake to Australian investors if it presses ahead with a swoop for Stansted Airport.
Last month, the MEN revealed Industry Funds Management had been selected as MAG's investment partner, in a deal understood to be worth around £1bn.
Under the plans, largest shareholder Manchester council would reduce its share from 55 per cent to 35 per cent. The remaining nine Greater Manchester councils would jointly have a 30 per cent stake, down from 45 per cent. Manchester council would have equal voting rights as IFM.
Now, the agreement has been confirmed in papers set to go before Manchester council's executive committee tomorrow (Wednesday). They will then be put to the other nine councils over the coming weeks. The move will lay the foundations for a takeover of Stansted, which competition watchdogs have ordered current owner BAA to sell off. Analysts suggest the London hub could have a £1bn price tag.
A joint statement by the Association of Greater Manchester Authorities and Manchester Airports Group said: "In February 2012, MAG confirmed that it was inviting detailed proposals from private investors as part of a strategic review of the business. This phase of the review has now been completed with Industry Funds Management (IFM) selected as MAG?s preferred partner. MAG is continuing to consider opportunities to add a quality airport to the Group. An equity investment by IFM will only be triggered by the acquisition of another airport by MAG."
IFM is an Australian infrastructure fund that has about $34bn invested in 26 different countries. It has fought off interest from a Hong Kong billionaire and a venture involving the Abu Dhabi Investment Authority, which has already ploughed millions into Manchester City.
RIVAL GROUP ENTERS BATTLE FOR STANSTED AIRPORT
A consortium led by an Australasian investment manager has emerged as an early rival to Manchester Airports Group in the £1bn battle for Stansted airport
Alistair Osborne, Business Editor - Daily Telegraph - 22 September 2012
Morrison & Co, which operates out of New Zealand, Australia and Hong Kong, is heading a bid team that also includes the New Zealand Superannuation Fund and Infratil, a Wellington-based infrastructure investor.
Stansted's owner, BAA, lost a three-year legal fight against its forced sale. BAA's controlling shareholder, Ferrovial, is thought to have issued non-disclosure agreements last week to interested bidders, effectively kick-starting the process. The sale is being handled by Deutsche Bank and ING.
Infratil's role has surprised some observers because it is trying to sell its two smaller British airports - Glasgow Prestwick and Manston in Kent. Infratil, which runs about £2.5bn of assets, has twice written down the airports in the past two years.
Even so, Infratil is an experienced airport operator and its operations at Prestwick have enabled it to develop a relationship with Ryanair, which is responsible for almost 70pc of Stansted's traffic.
The consortium faces early competition from the council-owned Manchester Airports Group, which is building up its firepower via a potential deal with Australia's Industry Funds Management.
The antipodean investor, which has around £21bn under management, has agreed to inject about £1bn for a 35pc stake in the Manchester airport company on the condition it wins the bid for Stansted.
The sale, which may also interest JP Morgan, Citi Infrastructure Partners and Morgan Stanley Infrastructure Partners, is complicated by the review of airport capacity in the South East, which could have a major impact on Stansted's value.
BUDGET AIRLINE AMONG BIDDERS FOR STANSTED AIRPORT
Geoff Percival - Irish Examiner - 22 September 2012
Ryanair has clarified that it is considering taking a stake in London?s Stansted Airport but is not actively pursuing a purchase.
The airline has been linked with a number of potential bidders for the airport - which is its main British hub - in the wake of it coming up for sale last month, as part of the dilution of UK airport owner BAA.
Britain's Competition Commission has forced BAA to sell Gatwick and Edinburgh airports and it is now set to lose control of Stansted, the UK's third largest airport. Ryanair, one of its main users, has been linked to a 25% stake, although chief executive Michael O'Leary dampened such talk at his company's AGM in Dublin yesterday.
Mr O'Leary admitted Ryanair has held discussions with "two or three" consortiums interested in owning the airport, but suggested the matter isn't a priority for management. He suggested that some of the related bidders want assurances that Ryanair will continue to grow at Stansted while others want the airline to take an equity stake.
Mr O'Leary said that while Ryanair wants to see Stansted sold, it is not actively pursuing a minority stake, but would consider investing.
Stansted could fetch up to £1bn and numerous private equity groups and airport operators have been linked.
Mr O'Leary told shareholders yesterday - ahead of the company's half-year results in November - that Ryanair hasn't changed its full-year profit guidance of ?400m-?440m and that it should increase passenger numbers by 5% to around 79m people. He noted that rising oil prices would likely increase operating costs, but that 80% of its fuel-buying needs have already been hedged.
While Ryanair is set to pay out its second special dividend, of nearly ?500m, in as many years to shareholders in November, Mr O'Leary said this is unlikely to become a trend, adding that he would prefer to spend the airline's money on new aircraft.
HEATHROW THIRD RUNWAY: LONDON COUNCILS
TO HOLD LOCAL REFERENDA
London mayor, Boris Johnson, backs poll plan and signals
possible London-wide vote on the issue
Hélène Mulholland and Paul McClean - The Guardian - 19 September 2012
Boris Johnson has backed local referenda across the capital to give Londoners a say on the prospect of a third runway at Heathrow, and signalled he may conduct a London-wide poll on the issue in the future.
The Conservative mayor made his comments after Tory-led Richmond upon Thames, one of the west London boroughs most severely affected by aircraft noise, announced it would hold a local referendum before 2013 on the issue to send a message to the government about the strength of feeling against any move to expand London's largest airport.
Residents will be asked to state whether they support expansion at Heathrow or not. They may also be asked their views on which other option they would prefer, including the idea of a new airport hub on the Thames estuary which Johnson has lobbied for over the past four years.
Another Tory-led council, Hillingdon, is also considering a local referendum on Heathrow expansion. The leader of the council, Ray Puddifoot, said it was in favour of Johnson holding a London-wide poll - a prospect that the London mayor has not ruled out.
Johnson, a staunch opponent of expansion at Heathrow, told the London assembly that it was vital to knock the "foolish" idea of a third runway once and for all "because as long as business thinks that option is still alive, that is going to be the one the Treasury will continue to push."
Johnson warned a third runway would serve as a prelude for further expansion at the airport later down the line. "There would then be a huge pressure to go for a fourth runway," said Johnson. "It is the wrong way for London. If there are going to be referendums on this issue locally then I would totally support it. I would vote no."
The coalition agreement rules out a third runway at Heathrow. But the prospect of U-turn by the Conservatives has been fuelled by David Cameron's decision to set up an independent commission into aviation capacity in the south east. The inquiry, chaired, by Sir Howard Davis, the former head of the Financial Services Authority, is due to report back its final conclusions after the general election, due in 2015.
Richmond borough leader, Lord True, said of the planned local poll: "As far as this council is concerned it will be all-out war with the big money interests and slick-suited PR men peddling this foolish project. It is perfectly possible to deliver increased airport capacity in south-east England without expanding Heathrow. No one in their right mind would consider building a new airport on the Heathrow site today - that must surely go for a new runway, too.
Zac Goldsmith, Conservative MP for Richmond Park, who has threatened to force a by-election if the government undertakes a U-turn by backing Heathrow expansion, welcomed the decision of the council in his backyard. "I absolutely support Richmond's decision, and very much hope this extends far beyond Richmond borough. The referendum will establish a crucial link between Heathrow expansion and voting, and with a good turnout and result, the government will be left in no doubt about the significance of Heathrow to west London voters."
John McDonnell, Labour MP for Hayes and Harlington, welcomed Richmond's decision to give residents a say, but added: "I am fearful that unless there are controls on the campaigning spending by the aviation industry we will not achieve a fair result."
On the prospect of local referenda being held, an aide to Cameron said: "Howard Davies is conducting a report into aviation capacity and an interim report will be published at the end of next year."
HEATHROW THIRD RUNWAY: POLL REVEALS PUBLIC SPLIT
Tory supporters tend to emphasise economic gains, while
Labour and Lib Dem voters focus on environmental concerns
Tom Clark - The Guardian - 13 September 2012
Britain is split down the middle on the question of Heathrow expansion - in a manner that reflects political splits in the coalition.
That is the finding of new research prepared for this week's YouGov-Cambridge forum, at which the Guardian is media partner. It shows that while 34% of voters believe a bigger airport would "encourage trade, travel and get the economy moving", another 34% say they are more concerned by the potential damage of noise and carbon pollution.
There is, however, a strong party slant to the figures. By a two-to-one margin of 50% to 25%, Conservatives emphasise the economic gains over the environmental damage. By contrast, Labour voters are slightly more inclined to take the environmental perspective - by a 35%-33% margin - as are Liberal Democrats more emphatically, by 45% to 34%.
The findings come the week after David Cameron risked the rage of the greener among his Liberal Democrat coalition partners by shunting out a transport secretary, Justine Greening, who was opposed to expanding Britain's biggest airport, and appointing an environment secretary, Owen Paterson, who has previously spoken out against windfarms and in support of certain fossil fuels.
The poll suggests post-reshuffle tensions at Westminster are mirrored among the two ruling parties' supporters. The difference is not so much that Conservatives are in denial about the environmental consequences of airport expansion - 63% believe it will cause a great deal or a fair amount of damage, which is less than the 72% of Lib Dems who say the same, but broadly in line with the 66% of voters overall who take this view. Rather, it is that Conservatives appear to give more weight to kickstarting the economy than to the environment.
Respondents were asked to rank various potential investments in energy or the economy for the amount of environmental damage they would do. Voters revealed a hierarchy of polluting policies that fits pretty closely with the green movement's campaigns. A "net damage score" can be calculated by subtracting the proportion of voters who regard each project as doing little or no damage from the proportion who regard it as doing a great or fair amount of damage. New coal power stations are rated as the most damaging, with a score of 48 percentage points, and expanding Heathrow comes close behind with a score of 43 points. Easing planning to encourage homebuilding and building new roads come mid-table, with respective scores of 20 and 19 points.
New nuclear power stations have divided environmentalists, with some regarding them as a necessary means of containing climate change and others bitterly opposed. Among the public 51% believe they will do considerable damage, against 36% who expect little or none, to give a net damage score of 15 points.
The High-Speed 2 train line, which is planned to run from London to Birmingham and then eventually to Glasgow, is promoted as a way to encourage the movement of traffic from dirty roads to cleaner rails, but is being resisted by campaigners concerned about the countryside it would cut through. The public give it a relatively low net damage score of five points.
Resistance to windfarms has been growing within the Conservative party, but not - according to the poll - among the public. Only 26% of respondents said they did great damage or a fair amount of it, as against 64% who said they did little or none. That gives a negative net damage score of -38, meaning windfarms are deemed a far cleaner investment than any of the alternative options. Underlying this pattern is, once again, a party divide.
While a majority of Tory voters, 58%, do not believe windfarms cause significant damage, a substantial minority of 37% take the contrary view. That compares with far small number of wind sceptics among Labour supporters (19%) and Lib Dems (18%). Conservative modernisers may point to this survey as underlining the political dangers of pandering to anti-windfarm campaigns that play well with a section of the party's core vote, but would appear to have less resonance beyond this.
Interesting additional party splits emerge in the ranking of the various projects. Labour voters look rather more kindly on coal than their counterparts - only 66% of them regard new coal power stations as doing great or a fair amount of damage, as against 70% of Tories and 81% of Lib Dems. By contrast, while both Lib Dem and Labour voters lean firmly against nuclear - with respective majorities of 57% and 56% suggesting new power stations would do substantial damage - the Conservatives are evenly split on the nuclear question, with 46% taking the same dim view and another 46% believing more nuclear stations would do little or no damage.
Between 9 and 10 September 2012, YouGov questioned 1871 GB adults. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+).
TRIALS SET TO TEST ENVIRONMENTALLY 'PERFECT' AIR TRAVEL
The initiative could save up to 1.6 tonnes of CO2 per flight
edie newsroom - 20 September 2012
The potential to save 30,000kg of fuel across 60 transatlantic flights is to be tested through a trial to see if environmentally 'perfect' flights are possible on a large scale. The trial, called Topflight, will feature 60 British Airway departures out of Heathrow to various North American airports.
The starting point for this work was in 2010 when an 'environmentally optimised' Heathrow to Edinburgh flight saved a quarter of a tonne of fuel compared with a standard flight over the same route. The aim now is to see if that can be repeated regularly on a transatlantic scale and be implemented for many flights at the same time, without penalising those in the surrounding airspace over a period of four months.
Led by NATS, the UK-based air traffic services company, it will examine the environmental impact of everything from aircraft pushback from the stand and taxiing to the use of an optimised flight profile and continuous descent approach.
At an expected 'perfect flight' saving of 500 kg of fuel per departure, equivalent to 1.6 tonnes of CO2 emissions per flight, a successful trial could translate into a huge global environmental gain. Heathrow alone, had more than 1,300 flights arriving and leaving every day in 2011, while NATS handled 2.
"Topflight is a great example of the aviation industry working together," said NATS' Managing Director, Operations, Martin Rolfe. "The industry has an opportunity to improve its environmental performance and the efficiency and fuel savings make great business sense too."
Topflight is a SESAR project, coming under the direction of the European Community's Single European Sky initiative whose aim is to modernise and harmonise air traffic management systems across Europe. With European air traffic expected to double by 2030, SESAR's challenge is to maintain safety levels while minimising delay, reducing costs and lowering carbon emissions.
The trial, which is being backed by the aviation industry in the UK, Canada and the US, is also supported by British Airways, Airbus ProSky and Boeing.
MPS PROBE INTO AIRPORTS WILL BEAT
GOVERNMENT INQUIRY IN RACE FOR SOLUTION
Transport select committee findings due in ahead of Government
Boris Johnson set to be invited to give evidence
MPs' report to pile pressure on ministers to come to a decision
Standard Online - 12 September 2012
MPs will launch a major inquiry into aviation tomorrow - pre-empting the Government's probe on UK airports.
The influential transport select committee is likely to reach a conclusion by early next year on where a major London hub airport should be sited.
The final findings are set to be delivered about six months before the interim results of the Government-commissioned report by Sir Howard Davies, the former boss of the London School of Economics, at the end of next year.
Mayor Boris Johnson will almost certainly be invited to give evidence to the committee, as will Government ministers, airline chiefs, environmentalists and campaigners against airport expansion. The MPs' in-depth report on the Government's aviation strategy will heap pressure on ministers not to drag their feet over whether to back a third Heathrow runway, a "Boris island-style" airport in the Thames estuary, a second runway at Gatwick, or expansion at Stansted.
The Conservatives have opened the door to supporting a bigger Heathrow, which the Liberal Democrats still firmly oppose, and the final Davies report has been delayed until after the next general election.
But Louise Ellman, Labour chairman of the transport committee, told the Standard: "The issue will not disappear. It must be addressed. We will be making recommendations about a hub airport which are likely to include where it should be located. We are intending to report in the first half of 2013."
Spelthorne Conservative MP Kwasi Kwarteng is the only London MP on the committee and he has led the campaign to put a third runway at Heathrow back on the agenda. The inquiry will also examine regional airports, passenger experience and air passenger duty. Given the number of MPs on the committee from outside London, including Liverpool Riverside MP Ms Ellman, it is likely to come up with some in-depth recommendations on regional airports.
David Cameron paved the way for the Tories to ditch their opposition to a third runway at Heathrow by moving Putney MP Justine Greening from Transport Secretary to the overseas development brief. She was one of the fiercest opponents of expanding the west London airport.
AIRPORT'S TRAIN STATION IS ON THE RIGHT TRACK
STANSTED Airport's train station is one
of the top 10 across the Greater Anglia network
Sinead Holland - Herts & Essex Observer - 20 September 2012
According to a report from the rail operator, a series of mystery shopping surveys have demonstrated improving customer service along the West Anglia route from London Liverpool Street to Cambridge.
In the most recent assessment period (July 22 to August 18) Cheshunt, Ponders End, Tottenham Hale, Walthamstow Central were in the highest scoring stations along with the airport. All scored above 90 per cent overall and Cheshunt scored 100 per cent for the provision of information at the station and was the highest scoring on the network with 93 per cent overall.
At Tottenham Hale the recently installed new toilet facilities were given an excellent score of 98 per cent. All Greater Anglia rail stations are regularly assessed by mystery shoppers for the standard of their facilities and level of customer service.
Greater Anglia's customer service director, Andrew Goodrum, said, "I am pleased to see that the quality of our station environments is improving, as shown by these good mystery shopping scores. We still have some work to do to achieve even higher scores in the future across the network, but this is a good start and demonstrates our commitment to continuously improving customer service and creating a welcoming environment for station users."
Greater Anglia is responsible for almost 3,000 employees and operates 1,900 train services per day. It services 167 stations and carries two million passengers a week.
RYANAIR IS 'COURTING DISASTER' BY FLYING PLANES
WITH NEAR-EMPTY FUEL TANKS TO CUT COSTS
Pilot union accuses it of 'operating on limits of legality'
But Ryanair insists planes have sufficient fuel reserves
Probe after diversion of Paris-Tenerife flight on Sunday
Ray Massey - Daily Mail - 19 September 2012
Ryanair is to be investigated by Irish and Spanish aviation authorities following accusations from pilots' leaders that the budget airline is 'courting disaster' by flying planes with near-empty fuel tanks to cut costs. Spanish pilot union leaders accused Ryanair of 'operating on the very limits of legality' in the way it fuels its planes.
Ryanair denies any wrong-doing and insists its planes are safe with sufficient fuel reserves. The decision to investigate came at a meeting of Irish and Spanish air safety experts in Dublin on Tuesday. The investigation relates specifically to the diversion to Madrid of a Ryanair flight from Paris to Tenerife on Sunday. But it follows a spate of incidents in Spanish airspace involving Europe's largest budget airline - including a number where flights have declared 'emergencies' and demanded to land because they were running low on fuel.
In a joint statement Ireland's Department of Transport, Tourism & Sport and the Spanish Ministry of Development met 'to discuss oversight of Ryanair's operation'. They added: 'As an example of this increased cooperation it was agreed that the circumstances of a specific incident in Madrid airport on 16th September would be jointly examined.'
Spanish authorities are also investigating emergency landings by three Ryanair planes in Valencia on July 26 after they approached their minimum required fuel after being diverted from Madrid because of bad weather. The pilots had been asked to circle above Valencia because thunderstorms in Madrid prevented them from landing there as planned. They were asked to join a queue but were given priority when they declared an 'emergency' because fuel was running close to the 30 minute minimum.
Ryanair has said the July landings were fully in line with EU safety procedures and that passengers were in no danger. Ryanair has also rejected claims by the Irish pilots' union (IALPA) that it pressures flight crew to carry the minimum amount of fuel required under European regulations.
Last night Ryanair's Stephen McNamara said: "We welcome today's joint statement from the Irish and Spanish Governments which affirms that Ryanair's safety standards are on a par with the safest airlines in Europe."
Ryanair said it had invited the Spanish Ministry to send a team of inspectors to Dublin to correct any 'misplaced concerns' about Ryanair's compliance with Europe's highest operating and maintenance standards. It was providing them 'with unfettered access to Ryanair operating, maintenance and flight training facilities and unlimited access to Ryanair's safety, flight management, engineering and maintenance personnel.'
Spanish authorities are also looking into an incident in which a Ryanair flight diverted and landed at Barcelona's El Prat airport after a possible engine fault was detected. Ryanair has accused the Spanish aviation authorities of falsifying information on incidents involving its planes, an accusation Spanish officials have rejected.
The Irish department of transport added in their statement after the meeting: "The Irish authorities gave an assurance of the Irish Aviation Authority's rigorous oversight of Ryanair's operations and on their satisfaction with Ryanair's safety standards which are on a par with the safest airlines in Europe." The row came as an official of the Spanish pilots' union SEPLA criticised Ryanair for pushing legal and safety limits to the maximum.
Accident investigator and spokesman for the union's technical department, Juan Carlos Lozano warned that cost-cutting on fuel by Ryanair compromised safety stressing they were not breaking the rules but adding: "They are operating on the very limits of legality." He explained: "Having a bit of spare fuel allows pilots to think and to make decisions, and if this variable is limited, obviously the crew's capacity to react is compromised, and the chances of a mistake happening are suddenly multiplied."
He added: "The executives send instructions to the crew, emphasising that for every x kilos of fuel they pump in the airline loses x amount of money.
As a consequence those in charge of the aircraft are confronted by a cost-cutting exercise that could lead them into difficult situations."
In an interview on Spanish national radio on Monday, Lozano said Ryanair's low fuel emergency landings were on the increase. It was not possible to operate an airline with 'this policy of pressure always working to the limits,' he said. He said if no action was taken then Ryanair was 'courting disaster'.
Ryanair last year carried more than 30 million passengers in Spain making it the country's largest passenger carrier. Spain's Public Works minister Ana Pastor, whose ministry runs aviation safety, has called for tighter safety regimes at low-cost airlines following a series of media reports about emergency incidents.
SSE ANGER AT GOVERNMENT
"WEAKENING" ON AIRPORT GROWTH
Sinead Holland - Herts & Essex Observer - 10 September 2012
STOP Stansted Expansion has conceded growth at the Uttlesford low-cost hub is back on the political agenda.
In a response to the Government's decision to establish an independent commission to establish an independent commission to look at aviation connectivity issues, chairman Peter Sanders made his displeasure clear. "We are obviously disappointed that the Government is not simply adhering to the policy which it laid down at the beginning of this Parliament, that there should be no more runways in the south east."
"But it has been clear for some time now that, in response to heavy lobbying by the aviation industry, it was about to review this policy, and it has also been clear that in this review all possibilities were going to be open for consideration, including expansion at Stansted. This weakening of the Government's position is regrettable, indeed deplorable. But given this background we welcome the appointment of an independent commission that will, we hope, examine the evidence and the arguments in a comprehensive and objective way."
He said three previous assessments had concluded there should be no more runways at Stansted: the Chelmsford Inquiry in the 1960s; the Roskill Commission in the early 1970s; and the inquiry chaired by Inspector Graham Eyre in the 1980s. Mr Sanders said: "We have every reason to believe that this new commission will reach the same conclusion."
Secretary of State for Transport (Patrick McLoughlin) - 7 September 2012
International connectivity is vital to support economic growth. This Government has made clear that its priority is returning this country to sustainable economic growth and our aviation networks and infrastructure have an important role to play.
The UK is an island nation dependent upon its transport links to the rest of the world for its prosperity. The aviation industry in the UK is extremely successful. It is a significant economic sector employing 220,000 directly and supporting many more indirectly and it contributes more than £16 billion of economic output. 35% of UK non-EU trade by value enters or leaves the country by aeroplane. Importantly the industry also provides this country with the global connections which our businesses need to sell their products abroad and which inward investors to the UK demand.
The Government recognises the importance of aviation to the UK. It is taking forward the Civil Aviation Bill to reform the economic regulation of airports to further the interests of passengers and create a better environment for investment. It is implementing the recommendations of the South East Airports Taskforce, including a trial of operational freedoms at Heathrow airport to improve reliability and reduce delay.
In July the Government published a draft Aviation Policy Framework (APF) for consultation; a framework which will set the high-level policy parameters within which any new proposals for airport development may be considered. The final APF will be adopted by the end of March 2013.
Alongside the draft APF the Government announced a number of short term measures to deliver operational improvements and boost economic growth within existing airport capacity constraints including £500 million towards a western rail link to Heathrow, a review of the UK's visa regime and the recruitment of 70 additional border staff at Heathrow.
Today the UK is amongst the best connected countries in the world. Our airports, particularly those in the South East, deliver direct flights to over 360 destinations, including those of greatest economic importance. London has more flights to more destinations than any other city in Europe. More flights to the important trading centres like New York, Hong Kong, and Singapore. The Government is determined to deliver a solution which will continue to provide that connectivity in the short, medium and longer term.
This is a very difficult debate, but the reality is that since the 1960s Britain has failed to keep pace with our international competitors in addressing long term aviation capacity and connectivity needs. Germany, France and the Netherlands have all grown their capacity more extensively than the UK over the years, and so are better equipped, now and in the future, to connect with the fast growing markets of emerging economies. The consequences are clear. Our largest airport and our only hub airport - Heathrow - is already operating at capacity. Gatwick, the world's busiest single runway airport, will be full early in the next decade, while spare capacity at Stansted airport is forecast to run out in the early 2030s.
The Government believes that maintaining the UK's status as a leading global aviation hub is fundamental to our long term international competitiveness. But the Government is also mindful of the need to take full account of the social, environmental and other impacts of any expansion in airport capacity.
Successive Governments have sought to develop a credible long term aviation policy to meet the international connectivity needs of the UK. In each case the policy has failed for want of trust in the process, consensus on the evidence upon which the policy was based and the difficulty of sustaining a challenging long term policy through a change of Government. The country cannot afford for this failure to continue.
The Government has asked Sir Howard Davies to chair an independent Commission tasked with identifying and recommending to Government options for maintaining this country's status as an international hub for aviation. The Commission will:
* Examine the scale and timing of any requirement for additional capacity to maintain the UK's position as Europe's most important aviation hub; and
* Identify and evaluate how any need for additional capacity should be met in the short, medium and long term.
In doing so, the Commission will provide an interim report to the Government no later than the end of 2013 setting out:
* Its assessment of the evidence on the nature, scale and timing of the steps needed to maintain the UK's global hub status; and
* Its recommendation(s) for immediate actions to improve the use of existing runway capacity in the next five years - consistent with credible long term options.
The Commission will then publish by the summer of 2015 a final report, for consideration by the Government and Opposition Parties, containing:
* Its assessment of the options for meeting the UK's international connectivity needs, including their economic, social and environmental impact;
* Its recommendation(s) for the optimum approach to meeting any need;
* Its recommendation(s) for ensuring that the need is met as expeditiously as practicable within the required timescale; and
* Materials to support the Government in preparing a National Policy Statement to accelerate the resolution of any future planning application(s).
A decision on whether to support any of the recommendations contained in the final report will be taken by the next Government. The Government intends this independent Commission to be part of a process that is fair and open and that takes account of the views of passengers and residents as well as the aviation industry, business, local and devolved government and environmental groups. We would like, if possible to involve the opposition as part of our work alongside Sir Howard to finalise the arrangements for the Commission. I will provide Parliament with further details on the full membership of the Commission and the terms of reference for its work shortly.
REVIEW PUTS STANSTED AIRPORT
BACK IN THE NATIONAL SPOTLIGHT
Paul Geater - Saffron Walden Reporter - 6 September 2012
IT was South Suffolk MP Tim Yeo who lit the fuse on a row that has now led to the removal of a cabinet minister and sparked furious rows at the top of Government. The debate over the south-east's air capacity and what to do about it has long been a toxic topic - and it threatens to remain that way.
Prime Minister David Cameron is expected to announce economist Sir Howard Davies will head an inquiry into what Britain should do to address the issue in the coming days. And any investigation will have to look not only at Heathrow and the so-called "Boris Island" plan but Essex's Stansted as well.
As the row once again gathered pace, Ryanair boss Michael O'Leary switched the focus back to Stansted saying he believed the next runway in the south-east would be built there. He added that he also thought Heathrow and Gatwick would get extra runways in the fullness of time.
Concerns over airport capacities have been on the agenda for years. In the 1970s, Edward Heath's government proposed building an airport at Maplin Sands off Foulness, in south Essex - a similar project to London Mayor Boris Johnson's plans for terminals and runways in the Thames Estuary.
Any expansion of the airport would affect a huge number of people over a wide area - and would affect both marginal constituencies in west London and safe Conservative seats in the prosperous Thames valley.
Opposition to a third runway at Heathrow was a specific point in the coalition agreement signed in May 2010. Last month, Mr Yeo called for the proposal to be revisited and asked whether the Prime Minister was "man or mouse" over the issue.
Transport Secretary Justine Greening - who represents the marginal west London seat of Putney - said she would not agree to an expansion of Heathrow, while Richmond Park MP Zac Goldsmith said he would not stand for the Tories again if their position changed.
For years the major debate on airport expansion focused on Stansted. And now many business leaders think Stansted could take the weight off other crowded airports by making use of the full capacity - but airlines and passengers would need convincing it is a viable option.
Campaigners saw off a proposal to build a second runway when the issue was last in the spotlight. Carole Barbone, from the Stop Stansted Expansion group, said: "The attention now seems to be on the development of a new 'hub' airport with many runways and that is not what has ever been proposed at Stansted - and there would never be the possibility of that happening. Stansted already has permission to operate at a capacity of 35 million passengers a year but at present is only operating at 17m. There is a long way to go before it reaches capacity. And it is clear that major international airlines don't want to go to Stansted - they don't think it has good enough facilities and it remains an airport for short-haul leisure flights."
But Essex and Suffolk's business communities would welcome more international and long-haul flights at Stansted and have urged airlines to take advantage of the airport's capacity.
Meanwhile, the row over Heathrow rumbles on - despite the Prime Minister attempting to put off any decision until after the next General Election which is scheduled for 2015. Yesterday Mr Yeo - who is championing Heathrow expansion rather than any changes at Stansted - said: "The business community now is almost unanimous in saying this is an urgent issue. We need more runway capacity in the south-east in the 2020s, not in the 2030s.
We've made a very good start actually by moving Justine Greening, who was a good Transport Secretary but had a difficult constituency issue to address. If we made this decision now, it would send a really encouraging signal to all those people who are investing here."
In the Commons Mr Cameron said: "Let me be very frank about this - very large infrastructure projects are extremely difficult for individual governments to take and to deliver. What we need to do is build a process that hopefully has cross-party support, so we can look carefully at this issue and deliver changes that will address the problems of capacity we will have in future years, and address the issue of the hub status of the UK.
I think it's important we work across party lines because this won't happen unless parties sign up to a process they can deliver."
RESHUFFLE SEEN TO PAVE WAY FOR HEATHROW U-TURN
Andrew Parker, George Parker and Mark Odell - Financial Times - 4 September 2012
The removal of Justine Greening as transport secretary and the appointment of Patrick McLoughlin as her successor has been widely interpreted as paving the way for the Conservatives to perform a U-turn on Heathrow.
Aviation industry insiders said Mr McLoughlin's arrival at the Department for Transport was seen as "positive" because it could contribute to the Tories eventually backing a third runway.
The Financial Times reported on Saturday how David Cameron, prime minister, is set to announce an independent commission to look at the UK's airports, in a move that could provide the Conservatives with the political cover to drop their opposition to Heathrow's expansion if the inquiry supports a third runway.
Both the Conservatives and the Liberal Democrats opposed a third runway in their 2010 election manifestos, and the coalition government's founding agreement confirmed this stance. Downing Street said on Tuesday there was "no change of policy" on Heathrow, but the independent commission on airport capacity is expected to be set up shortly.
Mr Cameron hopes final decisions can be delayed until after the 2015 election, which would avoid splitting the coalition, because the Liberal Democrats remain strongly against Heathrow's expansion.
Ms Greening, whose Putney constituency lies underneath Heathrow's flight paths, campaigned against a third runway before the election.
She said last week she would find it difficult to serve in a cabinet that supported the airport's expansion, and Mr Cameron has moved her to the post of international development secretary. Theresa Villiers, the aviation minister who also opposed Heathrow's expansion, has been promoted to Northern Ireland secretary.
The Heathrow Association for the Control of Aircraft Noise, a lobby group that opposes the airport's expansion, said: "The aviation industry will be popping open the champagne as two independent-minded ministers have gone. There will be fury in west London and beyond at the moving of Justine Greening."
Business leaders have been calling on the government to consider the case for a third runway as part of efforts to kick-start the stagnating economy, because Heathrow, the UK's only hub airport, is operating at near full capacity. BAA, Heathrow's owner, has in effect conducted a campaign for a third runway in saying that the airport's capacity constraints mean the UK could miss out on trade with emerging markets worth £14bn during the next decade.
International Airlines Group, parent of British Airways, the biggest airline at Heathrow, declined to comment on Mr McLoughlin's appointment, but said: "We want the government to get its act together in terms of tackling urgently the hub airport capacity issues in the UK." One person close to IAG said Mr Loughlin's appointment was regarded as helpful, together with the prospect of an independent commission to look at airport capacity, because both could contribute to the Tories ultimately supporting a third runway.
Boris Johnson, London's Conservative mayor and a leading opponent of the third runway, attacked Mr Cameron's decision to move Ms Greening, saying the only reason was "to expand Heathrow airport". Mr Johnson supports a new hub airport in the Thames estuary.
Mr McLoughlin, MP for Derbyshire Dales, served as aviation minister in the governments of Margaret Thatcher and John Major. In an interview with Total Politics magazine, Mr McLoughlin outlined how Cecil Parkinson, the former Tory transport secretary, told him he would be responsible for aviation. "I replied 'Cecil, I've got two problems with this. I've got the most landlocked constituency in the United Kingdom, and I'm afraid of flying'. 'Excellent', he said, 'you'll bring an open mind to the subject'," said Mr McLoughlin.
STANSTED WILL GET NEXT RUNWAY IN THE SOUTH-EAST,
SAYS RYANAIR BOSS
Michael O'Leary believes next new runway in region
will be at Essex airport, but Heathrow third is 'inevitable'
Gwyn Topham, Transport Correspondent - The Guardian - 4 September 2012
Ryanair boss Michael O'Leary has said he believes the next runway built in the south-east would be a second at Stansted, as he outlined his interest in bidding to run the Essex airport. But he added a third runway at Heathrow was "inevitable". He revealed he had been in talks with various potential investors about buying and running the airport, Ryanair's largest UK base, since BAA announced it would no longer fight the competition commission's ruling which forced it to sell.
The Irish airline called on the airport regulator, the CAA, to confirm if and how it will reduce Stansted's landing charges, which Ryanair said have grown by 68% in the last five years, while traffic has significantly declined. O'Leary claimed the CAA was allowing BAA to "cook the books" by inflating Stansted's assets. The airport is valued at £1.3bn although analysts predict it will not raise that sum.
He said: "The next runway in the south-east will be at Stansted. The south-east does need additional runway capacity: the advantage of Stansted is that it has already got planning permission, the land already exists, it's ready to roll. What it needs is a government decision allowing it to go ahead."
In reference to the longer term, he added: "I think a third runway at Heathrow is inevitable, then there will be a second runway at Gatwick."
But, he said: "Not in my grandchildren's lifetime will there be some lunatic airport in the Essex marshes or the Thames estuary or any other estuary."
Asked whether an airline would be allowed to have a stake in the running of a British airport, he pointed out a consortium of British airlines including IAG part-owns the air traffic control service NATS. Ryanair carries two-thirds of passengers flying from Stansted.
Ryanair would limit its holdings to below 25% but would want a management role. O'Leary said he could quickly reduce costs at the "grossly mismanaged" airport by scrapping "the cathedral of check-in desks" in favour of more retail space and "blowing up the train" that takes passengers from the terminal to the departure gates, replacing it with a bridge for passengers to walk over instead.
O'Leary said he would not force passengers to pay to use a toilet should he own or run the airport. In fact, he said, his often quoted plan to make passengers pay to pee in when flying was dependent on making airport toilets the cheaper option, so he could install more seats on his plane.
For now, true to form, O'Leary confirmed that Ryanair customers "with no life and no friends" who wanted to download its new mobile booking app would have to pay ?3 for the privilege. "If you want it you can pay for it."
The bullish airline boss also said he "didn't care" that Suzy McLeod, a Ryanair passenger, had recently won the support of hundreds of thousands of Facebook users after being forced to pay ?60 per person for the airline to print out boarding passes for her family of five at Alicante airport. He said: "We think Mrs McLeod should pay for being so stupid."
HOWARD DAVIES? THIS GOVERNMENT
MUST HAVE A DEATH WISH
Iain Martin Blogs - Telegraph Online - 5 September 2012
After writing that this was a middling-to-shambolic reshuffle - containing some good appointments and a few frankly bizarre promotions (yes, I'm looking at you, Hunt) - I decided to give it a rest for a few hours. I am clearly badly out of step with the consensus on much of the centre-Right which detects in the reshuffle the genius of George Osborne, fresh from his highly successful Budget. I also think that Boris is right: the third runway stuff is bonkers. And I don't think Cameron did himself much good - or made much of a difference at all really - yesterday.
Instead, I opted to spend the afternoon trying to ignore Twitter and writing the next chapter of my book on the financial crisis (out next year). In my research I have just got to the bit about the disastrous tripartite regulation system established by Gordon Brown in 1997. The Financial Services Authority, which exacerbated the crisis with its inability to regulate the banks intelligently, was run from 1997 to 2003 by a man called Sir Howard Davies. He was a nice man by all accounts, but what he built at the FSA turned out to be about as much use as a chocolate teapot when the banking sector inevitably got out of control.
What did he do next? From 2003 he ran the London School of Economics. I have no idea how well or otherwise he did this. All I know is that he had to resign last year because the institution got far too close to the Gaddafis. His resignation was an example of an honourably handled departure. He admitted responsibility and great regret. Admirably, he didn't hide from his critics. But the bottom line is that he had still allowed the LSE to get entwined with the playboy offspring of a lunatic Libyan dictator.
Davies then went into the British establishment's equivalent of semi-retirement, joining the board of the National Theatre and lecturing in Paris on financial regulation (yes, I know). So that's that, then.
But no, that's not it for Sir Howard Davies. A few minutes ago I tuned back into Twitter to find that he has a new gig. David Cameron has asked him to chair the Government's controversial review into airports capacity, which is being set-up because the Prime Minister doesn't fancy making a decision.
There is a quite a lot that this government does which qualifies for the word unbelievable. But appointing Sir Howard scoops the pot. In the meeting in Number 10 to decide this was there really not a point at which someone sensible said: "Erm, Sir Howard Davies? The FSA and then the Libyan School of Economics? Really best not, Prime Minister."
His appointment means that the inquiry will begin with critics of the government ridiculing the enterprise. The Tory dual leadership's best hope was instead to appoint a big independent figure, widely respected by all sides and utterly untainted. That way Cameron and Osborne would have stood some chance of this inquiry doing what they intend: namely, taking the heat out of the controversy about Heathrow.
But that, anyway, will surely turn out to be a vain hope on their part. Does Cameron really believe that his cave-in to the corporatist third runway lobby when it comes will not lead to a huge public campaign in West London, multiple Tory resignations and war with Boris, the man who means to replace him as PM? Such conflict is looking unavoidable and once its starts it will be difficult for Cameron to stop it getting out of control.
Boris, one senses, realises he has been gifted the first of the issues he needs to beat Cameron and then make it to Number 10. After the appointment of the controversial Sir Howard Davies, someone the Mayor will not fear one bit, Boris must think it is Christmas.
CAN THE UK FLY MORE WITHOUT BREAKING
CLIMATE CHANGE TARGETS?
Aviation industry says new measures will allow growth
without emissions increase, key for feasibility of new runways
Damian Carrington - The Guardian - 6 September 2012
Planes launched into the skies by catapults running on green energy, then cruising efficiently in self-organised flocks across oceans and continents. That is the kind of blue-skies thinking, outlined by Airbus on Thursday, that the aviation industry argues will allow an unrestrained increase in flying with no great increase in carbon emissions.
The realisation of these and other measures, such as biofuels and more efficient jet engines, is key in determining whether the UK could build new runways in the south-east and at Heathrow - a question in the spotlight after a cabinet reshuffle this week that seems to make it clear the government would like to - while keeping its commitment to tackling global warming. The other question is how much of the nation's future emissions, which will need to be cut severely to meet legally binding climate targets, are allotted to flying.
The aviation industry is bullish. "We think we can definitely decouple growth in aviation - and all the benefits that brings - from the growth in emissions, and the benefits of that," said Matt Gorman, the director of sustainability at Heathrow owner BAA and chair of the Sustainable Aviation Council (SAC), which represents over 90% of UK airlines and airports.
On past trends, the number of air passenger is set to rise by 250% by 2050, according to the Department of Transport. The SAC's 2012 roadmap argues that virtually all of the extra greenhouse gases that would be emitted by this rise can be cut by a combination of sleeker aircraft, leaner engines, smoother ground operations, more direct flight paths and up to 40% use of biofuels in global aviation. The roadmap goes even further, suggesting that the use of carbon trading would mean aviation's current carbon footprint could be halved even if passenger numbers more than doubled.
But environmental campaigners are scornful of the industry's vision. "The roadmap is wishful thinking in the extreme," said Jean Leston, a transport expert at WWF-UK. "We are being sold a lot of promises that are not being met. The measures may cut emissions by a few per cent, but the demand for flying is going up far faster. They should not be allowed to expand until it has demonstrated these efficiencies can be achieved."
Greens note that aviation is the fastest growing source of carbon emissions in the UK and that Britons have had the highest flying footprint of any nation. They also point to scientific evidence that the impact of carbon pollution emitted at high altitude is far higher than that at ground level, meaning the 5% of national emissions caused by aviation result in more than 10% of the country's contribution to global warming.
However, a new way of dealing with aviation's emissions has emerged since January with the inclusion of the sector in the European Union's emissions trading scheme (ETS), which caps the continent's output of climate-warming gases. According to supporters of new runways, this means any increase in pollution from extra planes and runways will be offset by cuts in other industries.
But environmentalists say aircraft emissions cannot be airbrushed away through carbon trading. "You are asking for future emissions for short-haul flights to take priority over heating peoples' homes - that is not a strong argument," said Joss Garman, former co-founder of campaign group Plane Stupid and now at Greenpeace. "Given a new dash for gas in the UK, new road building and then more aviation, at some point you have to ask where are the cuts needed actually going to come from?" Garman also warned that building new runways creates a lock-in effect, meaning high emissions for decades to come. "Once it is built, you will want to use it."
Rob Elsworth, policy officer at carbon trading think tank Sandbag, said: "There is an element of truth in the argument that under emissions trading aviation will have to pay for its pollution. But the major problem is that the ETS is not functioning well, as there are a billion tonnes of spare permits, and making the ETS effective is an extremely long-term process, dogged by political lack of will and the complexities of Europe's current economic situation."
Even BAA's Gorman acknowledges difficulties in the ETS: "It is still very early days for aviation in the ETS and it is inevitable that there will be some learning and improvements. But that does not undermine the basis of the policy."
The most authoritative and independent analysis of whether more flying is possible without breaking the UK's climate change commitments comes from the government's official advisers, the Committee on Climate Change (CCC). The CCC creates carbon budgets - the amount of carbon the country can emit in a five year period and keep to its climate targets - based on the lowest cost methods. It concluded that passenger numbers could increase by 60% by 2050 - a rise that would require new runways, though the CCC has no opinion on where they are sited - while still cutting total national emissions by 80%. That increase is far lower than the government forecasts of a 250% rise in passenger numbers, but higher than some environmentalists argue is possible.
A report by WWF-UK and the Aviation Environment Federation, claims that such a 60% rise could be achieved without any new runways being built at all. "Twenty per cent of flights out of Heathrow could easily be replaced by train travel," said Leston. "But airlines do not want that, as they would lose that source of income."
The CCC's target would mean almost a quarter of the nation's emissions in 2050 would come from aviation. David Kennedy, CCC chief executive, said: "We can fully decarbonise electricity, heating and ground transport through electrification, but we can't fully decarbonise aviation. So should we not use [a significant portion of our carbon budget] for something we value highly like flying?"
The CCC describes the industry's 25-40% target for biofuels as "speculative", stating that 10% is far more likely. "If you take all the waste in the world you can turn into biofuel and all the land that might be available and then use that fuel in the most economic way, there is not a lot left over for aviation," said Kennedy. British Airways's plan to turn half a million tonnes of Londoner's household rubbish into 50,000 tonnes a year of jet fuel from 2015 will provide 2% of the fuel it uses.
The argument over aviation and climate change in 2007 became focused on the "totemic" issue of the planned third runway at Heathrow, according to Kennedy. "That runway became associated with the idea that you cannot fly in a carbon-constrained world, but the answer is you can fly and fly a bit more than now. But what you can't have is unfettered growth."
The UK's aviation industry rejects this, by arguing that a 250% rise in passengers can be achieved in a low-carbon way. "Growth in aviation and tackling climate change are compatible," said Gorman.
On the other side, Greenpeace's Garman said: "It is ultimately about what type of economic growth you want to have. Do you want to build a low-carbon transport system or new aviation capacity that is inherently unsustainable?"
TRANSPORT INFRASTRUCTURE MUST BE A VITAL PART
OF ANY PROPOSED NEW AIRPORT OR EXPANSION, BUT
THE HEALTH RISKS MUST ALSO BE CONSIDERED
Letter to the Times - 3 September 2012
Sir, There has been practically no discussion about the health of those living near airports. The Government has a duty of care for the welfare of its population. In 1999, EU members adopted the WHO Charter, still extant, recommending that the welfare of communities must be put first when creating transport policy. Adverse effects fall disproportionately on the vulnerable, ie, children, the elderly and those with disabilities.
WHO stressed the importance of environmental and health impact assessments (HIAs) to ensure that air quality levels and noise are acceptable, particularly for schools and hospitals. HIAs were not carried out for developments at London airports except for Stansted where they were carried out by the British Airports Authority, acting as both enabler and regulator; scarcely a transparent arrangement. Although noise perception is variable it has been established that children living near major airports have delays in their cognitive function. There is also increasing evidence that atmospheric pollution near airports may be associated with cardiovascular disease.
Certainly, aircraft will eventually be quieter and emissions less polluting but current aircraft may not be phased out for 20-30 years. Commercial interests must not override the public health and since further development of Heathrow is inconsistent with this, offshore development is the only solution. Other countries have achieved this initiative; it requires imagination and funding but who pays?
Professor J. E. Banatvala
BAA GIVES UP FIGHT TO RETAIN STANSTED
Rose Jacobs - 20 August 2012
A sale will leave the company that once owned London's three biggest airports with just Heathrow and a handful of regional facilities, including Glasgow airport. The operator, an arm of Spanish infrastructure group Ferrovial, had hoped to cling on to the capital's third-biggest airport by passenger numbers and fought a half-dozen appeals as it tried to do so.
"We still believe that the ruling fails to recognise that Stansted and Heathrow serve different markets," said BAA on Monday, but decided not to appeal against last month's Court of Appeal ruling which found otherwise. "[We are] now proceeding with the sale of Stansted airport."
Analysts expect Stansted to fetch about £1bn, or 11 times last year's earnings before interest, tax, depreciation and amortisation (ebitda). Several parties are understood to be interested in bidding, including pension funds, infrastructure funds and trade buyers such as Manchester Airports Group, which would fund a deal by selling off a third of its own equity.
Regulated airports such as Stansted are a rare prize and appeal to investors looking for safe, inflation-pegged returns. The risk in these deals usually lies in the capital structure, since the multibillion-pound purchases are often highly leveraged. Serving 17.5m passengers a year, Stansted is the UK's fourth-biggest airport and the third biggest in the capacity-constrained south-east of England. However, its numbers are significantly lower than five years ago, dented by the recession-induced dip in leisure travel.
Stansted's biggest customer is Ryanair, which runs three out of four flights into and out of the airport and with whom BAA has a tortured relationship. The low-cost carrier has - together with rivals such as EasyJet - moved routes elsewhere as airport charges have risen and argues that BAA "is damaging Stansted and harming consumers". Fifteen other carriers also use the airport, and the facility handles 205,000 tonnes of cargo a year.
BAA's other airports include Glasgow, Southampton and Aberdeen. Three years after Ferrovial bought the group, in 2006, UK competition authorities found it wielded unfair market power in London and Scotland and ordered the disposal of Gatwick, Stansted and either Glasgow or Edinburgh airports.
By the time of the ruling, the company was close to unloading Gatwick for 10 times ebitda. This year it sold Edinburgh for almost 17 times last year's earnings.
Campaign group says it cannot rest on its laurels as BAA finally
gives in to demands to break-up its market monopolising franchise
Stansted sale does not signal end of second runway bid
Essex Chronicle - 23 August 2012
Stop Stansted Expansion (SSE) welcomes this week's announcement by BAA that it has finally accepted the Competition Commission's ruling and will now sell Stansted Airport. AFTER four failed attempts to fight a decision to sell Stansted Airport, owners BAA have finally agreed to sell Britain's fourth busiest airport. Here, Brian Ross, of the Stop Stansted Expansion campaign group, gives his thoughts about the decision
Many people will say "Better the devil you know" and no-one knows what the future may hold but for a number of reasons we believe that the threat of major expansion at Stansted will be lessened when BAA no longer owns our local airport.
BAA - including its predecessor, the British Airports Authority - has pressed for major expansion at Stansted four times in the past 40 years and almost throughout that time BAA has been relentless in lobbying both Labour and Conservative Governments to endorse plans for at least one extra runway at Stansted.
BAA's origins as a Government-owned business - in effect, a subsidiary of the Department for Transport - and its market dominance through its ownership of Heathrow, Gatwick, Stansted and four other major UK airports - gave it enormous political influence in Whitehall. Many believed that BAA virtually wrote the Government's airport policy.
Historically, BAA was also financially very powerful, mainly due to the huge profits generated by Heathrow, the jewel in BAA's crown. For almost 20 years, the development of Stansted was paid for by cross-subsidisation from Heathrow passengers, whereby the CAA allowed Heathrow to raise its airport charges to pay for expansion at Stansted. Without cross subsidy major expansion at Stansted would not have been commercially viable.
Facing the threat of legal action by SSE and others, the CAA halted cross-subsidisation in 2004, but BAA continued to press for its re-introduction, as a basis for funding a second Stansted runway. SSE was always concerned that the ban on cross-subsidisation for expansion at Stansted out of Heathrow revenues could be lifted, easing the way for BAA to finance a second Stansted runway.
Those are the main reasons why, for more than eight years, SSE vigorously campaigned and lobbied for the break-up of BAA. It was a key strand in our strategy to prevent a second Stansted runway and it delivered a not entirely unexpected bonus in the early part of 2009.
In March 2009, we were just one month away from the start of the public inquiry to consider BAA's planning application for a second Stansted runway. The inquiry was expected to take about 18 months and the BAA and SSE barristers were already hard at work preparing submissions. BAA had the support of the Government of the day and was confident it would win approval for a second runway.
And then, on 19th March 2009, the Competition Commission published its final report, ruling that BAA must sell Stansted. This put the cat amongst the pigeons, causing the public inquiry to be indefinitely postponed and, later, to be cancelled altogether.
If the Stansted public inquiry had not been shelved in 2009, neither the Tories nor the Lib Dems would have been able to commit, as they did in their 2010 General Election manifestos, to cancelling plans for a second Stansted runway. Construction of that runway would probably have been well underway by now. Fortunately, that is not how things turned out.
In conclusion, I am proud of the part played by SSE in achieving regime change at Stansted but this is tinged with a degree of apprehension as to who will take control of Stansted and what plans they will have. We may come to rue the day when BAA sold Stansted but you don't win campaigns by just sitting on the fence.
MAG LEADS EARLY STANSTED AIRPORT BID BATTLE
British airports operator BAA opened the way for a $2 billion
(1 billion pounds) sale of London's Stansted on Monday with
Manchester Airports Group (MAG) an early frontrunner in a bid battle
expected to draw U.S. banks, pension funds and Asian operators
Rhys Jones and Sophie Sassard - Reuters - 20 August 2012
BAA on Monday decided against a last-ditch challenge to a regulatory ruling which is forcing it to sell the airport as part of a drive to bring more competition to the market. Last week, Qatar Holding, the finance arm of the Gulf Arab state's sovereign wealth fund, took a 20 percent stake in the operator, underscoring ongoing interest in such assets.
The fund said the UK "remains an attractive investment destination" and other investors are also expected to be drawn by a business that tends to offer stable, long-term cash flows as well as the potential for growth in passenger numbers. One such investor is Manchester Airports Group (MAG), which has made no secret of its interest in Stansted and has already lined up funding for an expected swoop.
Earlier this month Australia's Industry Funds Management (IFM) agreed to buy a 35 percent stake in MAG if the group wins the battle to buy Stansted.
Banking sources said MAG, which also operates Britain's Bournemouth and East Midlands airports, is likely to face competition from the infrastructure arms of U.S. banks, as well as investors in and owners of airports in Asia.
A transport banker said South Korea's Incheon airport authority, which lost out in a bid for Edinburgh airport as part of a J.P. Morgan-led consortium, was keen on Stansted and that pension funds in the UK and abroad would also look at it. "The frontrunner here seems to be MAG and its new Australian partner," said an infrastructure banker seeking a role in the deal who declined to be named. "Infrastructure funds like J.P. Morgan Asset Management and Morgan Stanley Infrastructure are very likely to look at it because they have the money and the expertise to run this kind of asset."
Ferrovial is BAA's largest shareholder with a 40 percent stake and heads an ownership consortium made up of Qatar Holding, GIC Special Investments, Alinda Capital Partners and Britannia Airport Partners. BAA has invited banks including Bank of America Merrill Lynch, Deutsche Bank and Morgan Stanley to pitch ideas on how to handle the sale, the infrastructure banker said.
The sale of Stansted, which handled 18 million passengers last year, is part of a drive by Britain's competition regulator to loosen BAA's grip on the UK airports market. Global Infrastructure Partners (GIP), which bought Scotland's Edinburgh airport for $1.3 billion earlier this year, is unlikely to bid for Stansted because it knows any move would be blocked by regulators. It also bought Gatwick - Britain's second busiest airport behind London Heathrow - for 1.5 billion pounds in 2009 when the regulator forced BAA to dispose of that site.
The ongoing regulatory crackdown has been a major headache for Ferrovial. When it bought BAA for 10.3 billion pounds in a highly-leveraged deal in 2006, Ferrovial planned to keep all of its airports and make them more efficient by outsourcing services. Instead, it has been forced to sell assets at a time when valuations are lower than when it bought the business.
BAA currently owns London's Heathrow, Europe's busiest airport, as well as Southampton and Stansted in England along with Glasgow and Aberdeen airports in Scotland. Single runway Stansted, which is predominantly a low-cost leisure and holiday airport, is based 50 kilometres northeast of central London and is the fourth busiest airport in the UK. Plans for extra runways at Stansted and Heathrow were dropped by BAA after the Conservative-Liberal Democrat coalition came to power in 2010 and the future of the airports is unclear.
"Valuing Stansted is difficult because of uncertainty around what will happen with new runways, which makes it difficult to make a precise valuation. Stansted is also dominated by Easyjet and Ryanair which is bad news for an operator as Ryanair is getting more aggressive," the transport banker said.
Ryanair has clashed with several airports over the taxes and fees they charge airlines. It recently cut the number of flights to Madrid and Barcelona from the UK in a row over fees. Some analysts, however, believe Stansted could fetch up to 1.3 billion pounds ($2.04 billion).
RBC Capital analyst Olivia Peters believes Stansted could potentially be sold for 95 percent of its regulated asset base (RAB) - around 1.28 billion pounds or around 14.2 times its annual earnings before interest, taxes, depreciation and amortisation (EBITDA). "It seems that there is still substantial interest in UK airport assets as demonstrated by Qatar's recent purchase of a stake in BAA," said Peters. "The stake went for a 13 percent premium to Heathrow's RAB."
Ferrovial on Friday sold a 10.6 percent stake in FGP Topco, the holding company that owns BAA for 607 million euros to Qatar Holding, a deal giving it an enterprise value (equity plus debt) of 13.7 times EBITDA.
"Stansted's RAB is about 1.3 billion pounds. Gatwick was sold for 90 percent of its RAB but Stansted is likely to be sold for less, but not much less," the infrastructure banker said, adding that the sale process would likely start by October and that a deal could happen by the end of the year.
One alternative option is that Ireland's Ryanair is keen to take a 25 percent stake in Stansted through a consortium. Consortia want the airline as an "anchor tenant" to guarantee future growth at the airport, Ryanair Finance Director Howard Millar said recently, adding that the carrier was considering proposals from several groups.
RYANAIR EXPRESSES INTEREST IN STANSTED
AS BAA PUTS IT UP FOR SALE
BAA has put Stansted airport up for sale in a move that
could see Ryanair taking a stake in its biggest British base
Dan Milmo, Industrial Editor - The Guardian - 20 August 2012
Britain's largest airport group announced on Monday that it is ending a protracted legal battle over the sale of the Essex airport, which had been ordered by the Competition Commission in 2009 but had been hotly contested by its owner ever since. BAA said it would not challenge a recent loss in the Court of Appeal over the commission ruling and will sell the airport. Stansted is valued at just over £1.3bn according to a formula used by the Civil Aviation Authority, the industry regulator, to calculate landing charges at the airport. However, some industry observers view £1bn as a par bid for the asset.
"Having carefully considered the Court of Appeal's recent ruling, BAA has decided not to appeal to the Supreme Court and is now proceeding with the sale of Stansted Airport," said BAA. A spokesman for Ryanair, which operates 41 airplanes from the airport, said the carrier would be interested in a deal. Last month Howard Millar, Ryanair's deputy chief executive, said the airline has been approached by potential buyers with the view to joining a consortium bid. He said: "We have met these consortia and they want us to be an anchor tenant." Last year Stansted posted an operating profit of £39.4m, compared with £526.8m at Heathrow.
A spokesman for Ryanair said on Monday that if the airline did not take a stake it would also be interested in giving long-term assurances to bidders over its commitment to the airport. Ryanair and its biggest Stansted rival, easyJet, have been pulling capacity out of the airport over the past five years, reflecting their displeasure over rising landing fees. The Ryanair spokesman said the airline would be interested in returning the airport to pre-boom levels of use, when it handled 24 million passengers a year compared with 18 million now. "There is huge growth potential there and we would be very interested in discussing the future of Stansted with any groups looking at a potential purpose."
Stansted is now Britain's fourth largest airport, having slipped behind Manchester, which carried 18.8 million passengers last year - 760,000 more than Stansted. The Essex airport will be BAA's third major disposal following the sale of Gatwick in 2009 and the disposal of Edinburgh Airport in 2012. Both times the airports were acquired by Global Infrastructure Partners, a New York-based investment group, but it is believed that GIP is not interested in bidding. As the owner of London's City airport, it is also likely that any offer would face watchdog scrutiny. As well as Ryanair other potential bidders include Manchester Airports Group and South Korea's Incheon.
Last week BAA's biggest shareholder, Spanish conglomerate Ferrovial, announced an agreement to sell 10% of BAA to Qatar's sovereign wealth fund in a transaction that would give Qatar Holding a 20% stake in BAA's parent company.
CHEAPER FLIGHTS COULD BE IN STORE
IF RYANAIR BUYS SHARE IN STANSTED
CHEAPER flights and a walk-in, walk-off airport could be in store, if low budget airline Ryanair buys a 25 per cent share of Stansted Airport
Essex Chronicle - 25 August 2012
The airport has been put up for sale after the BAA failed to overturn a decision made in 2009 by the Competition Commission. The commission ruled that BAA had to sell Stansted because of competition concerns arising from its ownership of the UK's biggest airport, Heathrow.
BAA announced on Monday it would not be taking the ruling to the Supreme Court, after a fourth attempt to overturn the decision was thrown out by the Court of Appeal last month. Irish-based Ryanair has made public its interest in buying a share of the airport, which is reported to be worth £1 billion.
Stephen McNamara, of Ryanair, which operates to 41 destinations from the airport, said: "The sale of Stansted into separate ownership will lead to more competition, lower passenger charges, improved passenger services and the roll-out of additional and much-needed traffic growth at competitive prices in Stansted." The company claims it would revolutionise air travel, with a "walk-in and walk-off" service to speed up journey times.
Mr McNamara added: "Since 2008, the BAA has doubled prices at Stansted and overseen a decline in traffic from 24 million in 2007 to 18 million in 2011, with this decline continuing in 2012. The BAA's seven failed court appeals were a blatant attempt to delay the sale while BAA and its Spanish owners, Ferrovial, fattened up its monopoly profits at the expense of airlines, passengers and British jobs."
AIRLINES TO PROBE APD AS CAMPAIGN TARGET NEARS
Ian Taylor - Travel Weekly - 20 August 2012
Public support for the Fair Tax on Flying campaign is expected to top 100,000 this week as work begins on a study of the full impact of Air Passenger Duty (APD), commissioned by airlines which have lost patience with the government.
The Fair Tax on Flying coalition's call for supporters to write to MPs demanding a Treasury review of APD has proved an unprecedented success since its launch two months ago. The coalition includes Abta, Tui Travel, Thomas Cook, British Airways, Virgin Atlantic, easyJet, and a host of travel industry and business groups.
However, BA parent IAG, Virgin Atlantic, easyJet and Ryanair also have their own Axe the Tax group, fronted by the four chief executives, and have commissioned their own study of the economic impact by auditor and consultancy PwC.
The three UK carriers support the latest campaign - indeed, the backing of Virgin president Richard Branson has been key in taking support near to the 100,000 mark. But privately the airlines believe the Treasury is unlikely to bow to the demand to examine the economic impact of APD, so they are paying for their own study.
An airline source confirmed to Travel Weekly that the study is underway and will be completed this autumn. The carriers intend to use the result to apply pressure on and potentially embarrass the Treasury leading up to the Chancellor's autumn statement. Seventy-five MPs of all parties have signed a petition demanding an 'early day motion' (EDM) in Parliament to discuss an economic review of APD.
OUR COMMENT by Brian Ross, SSE's Economics Adviser:
Air Passenger Duty - 10 Key Points
1. APD was introduced in 1994 by Ken Clarke, the then Chancellor of the Exchequer, not as an environmental tax but because he considered the aviation industry to be lightly taxed compared to other sectors, largely arising from its exemption from fuel duty and VAT.
2. APD was initially set at £5 for short haul economy travel, which accounts for more than three quarters of all air travel. In 1997 Ken Clarke doubled APD to £10 for short haul economy flights.
3. Gordon Brown halved the short haul economy rate of APD in 2001, put it back up again to £10 in 2007 and Alistair Darling upped it to £11 in 2009. George Osborne increased it to £12 in 2010. There was no increase in 2011 but it was raised from £12 to £13 in April 2012. Thus, for the vast majority of air passengers the rate of APD has increased by 30% over the past 15 years.
4. APD raised £2.6bn for public finances in 2011/12 and this is planned to increase to £3.9bn in 2015/16. APD would, however, need to rise to four times its current level to offset the value of the industry?s exemption from fuel duty and VAT. If airlines paid the same level of fuel duty and VAT as road users, the cost to the aviation industry would be around £10.5bn a year.
5. Not only do airlines pay no VAT on fuel, they are exempt from VAT on everything they buy relating to the provision of air transport services. Mostly, VAT is not charged in the first place; aircraft and aviation fuel, for example, are zero rated. However, where VAT is charged, the airlines claim this back and in 2010/11, HMRC paid UK airlines a VAT rebate of £583m (net).
6. In 2010/11 (the latest year for which a detailed HMRC breakdown is currently available), 77% of passengers paid APD at the short haul economy rate (Band A). Note also that APD is payable only on departure from a UK airport and so the basic Band A rate of £13 is for a round trip to an overseas destination. APD is however payable on both legs on a UK domestic round trip.
7. Virtually all of Stansted's passengers are short haul economy travellers and so subject to the lowest (£13) rate of APD. Some Stansted passengers are totally exempt from APD, for example, passengers flying out on business jets with less than 20 seats and those using air taxis (including helicopters), although the Government intends to address these anomalies from next April.
8. Whilst it is true that "passengers can end up paying £184 tax on some flights", this is the very top rate of APD and applies only to first class and business class passengers on long haul flights to countries whose capital city is more than 6,000 miles from London. Less than 0.4% of all air passengers fell into this category in 2010/11.
9. Regarding the alleged negative impacts on the UK economy of the recent hikes in APD, it is worth noting that overseas leisure trips by UK residents reduced from 60.1m in 2008 to 49.2m in 2011 - a fall of 10.9m (22.3%) whilst the number of foreign tourists coming to the UK fell by just 293,000 (1.6%) over the same period, from 23.8m to 23.5m. The effect of this was to reduce the UK's tourism trade deficit from £19.8bn in 2008 to £13.0bn in 2011.
10. Finally, those who are pressing the Government for APD to be reduced should explain how they would propose to make up the revenue shortfall because in the current economic climate there are no free lunches. So, should we sack some more policemen, teachers or nurses? Or should we cut pensions or welfare benefits? Or should we raise VAT and/or extend its scope?
OUR COMMENT: While the Government consults on future Aviation Policy the battles for public support continue. More flights? More runways? More hub airports? Is your flight really necessary? What about the noise? The pollution? Your cheaper holiday?
JUSTINE GREENING 'IN THE WAY' OF U-TURN ON HEATHROW
Transport Secretary's opposition to runway
makes her position in Cabinet 'untenable'
Oliver Wright - The Independent - 25 August 2012
Justine Greening could become the first Cabinet Minister to be removed from her job because she supports Government policy, it was suggested yesterday. Some senior Conservatives, who are in favour of building a third runway at Heathrow to boost economic growth, said that Ms Greening's long-held opposition to the plan meant that she could not remain in her position as Transport Secretary.
They suggested that with Chancellor George Osborne now in favour of a third runway it would be necessary to move Ms Greening in the planned September reshuffle to allow a U-turn to take place. However, others in Government dismissed the idea, pointing out that opposing the runway was Government policy.
They added that the Liberal Democrats had been clear that they would block the move and that David Cameron said last month that Government policy would not be changing. But Richard Wellings, head of transport at the Institute of Economic Affairs think-tank, said Ms Greening's position was "untenable". "It is a problem having her as Transport Secretary with such a local interest in the issue; given her critical views on Heathrow expansion, it would make sense to replace her," Mr Wellings told the Financial Times.
One senior Tory added: "It would be bizarre to keep her in that job when her position over aviation is now the polar opposite of the Prime Minister and the Chancellor."
The Government is expected to publish its long-awaited consultation into airport expansion in the South-east in the next couple of months. While that will not specifically rule out a third runway - and ask for supporters to make a case for it - it will make clear that Government policy is to look for other solutions.
Willie Walsh, chief executive of International Airlines Group, which controls British Airways, said he saw the lack of progress on aviation as a "disgrace". "I don't believe this government has the political will to address the issues," he said. "David Cameron seems a lot happier clapping and cheering for gold medals than dealing with tough, long-term economic challenges."
Ms Greening made her name campaigning as a backbencher in her Putney constituency through her resistance to a third runway at the airport. The Tories entered the 2010 general election opposing the Heathrow scheme, but many MPs now want a public U-turn on the issue to promote economic growth.
Richard Harrington, a Tory backbencher, said he backed "anything that will increase capacity" at Heathrow. "I was very impressed at Justine Greening at the Treasury and I'm sure that if she had a problem with the Heathrow project they can put her in another more senior job where her talents could be properly used by the Government," he said.
But Department of Transport sources pointed to remarks made by Mr Cameron just last month, in which he effectively ruled out a third runway - at least in the short term. "Be in no doubt, by the end of the year we will have both this review underway and the call for evidence about all the future options underway, and I think that's vitally important," Mr Cameron said. He added: "Both the Coalition parties made a pledge not to have a third runway, and that's a pledge that we made and that we will keep."
MINISTERS READY FOR BATTLE OVER GREENBELT GRAB AS THEY PLAN TO SEIZE LAND FOR HOUSING AND NEW AIRPORT
Ministers are planning to seize chunks of the greenbelt to build housing developments and pave the way for a new hub airport, the Mail has learned
Tim Shipman - Daily Mail - 23 August 2012
The Treasury is prepared to 'have a fight' with green campaigners by pushing through rules which would let ministers redesignate areas of greenbelt as available for development. Chancellor George Osborne plans to let ministers rather than local councils decide where to build hundreds of thousands of houses by reclassifying them as projects of national importance. The plans are due to form a centrepiece of the Government's new Bill to boost economic growth next month.
They will enrage groups such as the National Trust and Campaign to Protect Rural England. But Treasury sources say they are determined to press ahead because 'having a fight with the critics will show the public that we are serious about taking difficult decisions to boost growth'.
In the first move towards this ministers will today back a report on the private rental sector by venture capitalist Sir Adrian Montague.
He says councils should waive the requirement for developers to devote 40 per cent of their projects to affordable housing when they are building homes specifically for rent. Those demands are widely thought to be stalling projects that are ready to go because they have shrunk developers' profit margins.
The report also recommends that the Government makes public land available to build rental accommodation and underwrites some of the risk of building developments. The proposals were described by Housing Minister Grant Shapps as a 'blueprint' for boosting the housing market and the economy since it will give renters more choice. At present the limits of protected greenbelt land are set by local authorities but government sources say plans are afoot to carve areas out of the land to build houses while keeping its overall size the same.
One said: "You would take an area from one place and hand a bit back from somewhere else. At the moment you can do it in certain circumstances. We want to make it easier." Plans which affect the greenbelt will be controversial because the Tories pledged to protect it in their last election manifesto. In addition ministers are examining plans to designate housing developments as infrastructure projects, so ministers, rather than town halls, would give final approval.
That would put them on the same footing as power stations, roads and airports, which are all regarded as developments where national need overrules local objections. Senior Tories have also revealed that the party will also go into the next election pledging a huge expansion at either Gatwick, Stansted or Luton airports, making one of them a multiple-runway hub airport.
The Chancellor and David Cameron have ruled out a third runway at Heathrow as politically impossible because of the effect on voters in West London.
They regard Boris Johnson's plans for a hub airport in the Thames estuary as impractical since the proposed airport will clash with air routes into Amsterdam's Schiphol airport.
DARLING DEFIES MILIBAND OVER THIRD HEATHROW RUNWAY
Matt Chorley - The Independent - 26 August 2012
Alistair Darling, the former chancellor, has defied the Labour leader Ed Miliband and called for a third runway at Heathrow to be approved. Britain's ability to attract foreign investment is being undermined by a lack of capacity at its biggest airport, Mr Darling warned.
In an interview with The Independent on Sunday, he said: "You can't just ignore the problem and hope it will go away. Everybody who flies wants a runway, and nobody who lives near one wants one at all. There is a consensus we actually do need more capacity."
The coalition government is split on the issue: George Osborne is keen to reconsider opposition to a third runway. Yesterday, Grant Shapps, the housing minister, told The Daily Telegraph he backed the Chancellor's position "to the hilt". Last October, Labour abandoned its support for expansion, when Mr Miliband backed Maria Eagle, the shadow Transport Secretary, who said "the third runway at Heathrow is now off the agenda because of the local environmental impact".
But Mr Darling rejected the idea of a new airport in the Thames estuary, which he said would attract high landing charges and damage business in west London. Addtional capacity was needed at Heathrow to bolster growth, Mr Darling said, as he took aim at George Osborne's stewardship of the economy. "An impression is beginning to emerge that both the Chancellor and the Bank of England have given up," he said.
Change of heart on airport expansion
December 2003 Alistair Darling backs a third runway "to meet the pressures we know we'll face as a result of a growing economy".
June 2008 David Cameron burnishes green credentials to oppose third runway, declaring: "We are not going to drop the environmental agenda in an economic downturn."
January 2009 Government approves plans.
May 2010 Conservative manifesto pledges to "stop the third runway".
October 2011 Justine Greening, MP for Putney who opposes expansion at Heathrow, appointed Transport Secretary.
March 2012 IoS reveals George Osborne wants a third runway "back on the table".
PILOTS FORCED TO MAKE EMERGENCY LANDINGS
BECAUSE OF FUEL SHORTAGES
Pilots have had to make 28 emergency landings because they were running low on fuel according to figures compiled by the Civil Aviation Authority
David Millward, Transport Editor - Daily Telegraph - 20 August 2012
The incidents led to the aircraft being given landing priority by airports over other flights were often triggered by planes facing difficulties after having been diverted because of bad weather. A number of airlines have been involved including Virgin Atlantic when two jumbo-jets sought priority landing at Stansted in January and last month Ryanair was forced to seek an emergency landing for three of its aircraft in Spain.
Although the total represents of fuel-related emergency landings is a reduction on 2008-10, when there were 41 such incidents, some pilots have warned the airlines are operating on very narrow margins as they seek to cut operating costs.
Legally pilots entering British airspace must not only carry enough fuel to complete their journey, but also a reserve which would allow them to reach an alternative airport with enough in hand to allow for 30 minutes circling before being permitted to land.
On top of that there must be a contingency reserve supply to cope with headwinds which can lead to more fuel being consumed. Once they have less than 30 minutes flying time left, pilots have to seek an emergency landing. There are two classifications of emergency landing. A ?PAN? - standing for Procedure for Air Navigation Service - is a request for priority over other aircraft. More serious is a Mayday, where fire and rescue will have to be put on alert.
In January two Virgin Atlantic flights, which had been diverted to Stansted because of bad weather, sought a PAN priority landing. According to CAA records this was because of a "fuel shortage". A Virgin spokesman said: "Following standard procedures a PAN alert was issued to give priority landing. Our fuel management procedures are approved by the CAA and comply with all industry regulations. We plan our fuel loading on a number of factors, we carry more than regulatory minimums and load extra fuel for anticipated factors such as weather."
On landing both aircraft, whose pilots had believed they were about to start using their reserve supplies, were found to have over the legal minimum fuel requirement in their tanks. The Virgin planes were among 18 diverted to Stansted because of the weather, one other short haul operator also declared a Mayday because of a fuel shortage.
Ryanair, had to declare a fuel emergency in Spain last month, after three flights were left in a holding pattern for up to 70 minutes after being diverted from Madrid to Valencia during heavy storms. One retired pilot told the Exaro website that he and his colleagues were under pressure from airlines because of the industry's need to keep costs down.
"There is pressure on pilots by airlines to carry minimum fuel because it costs money to carry the extra weight, and that is quite significant over a year. The fuel burns of each aircraft are very carefully recorded over a very long time to get accuracy to enable the correct amounts of fuel to be loaded. There will always be the unexpected events, and that is why reserves are carried. The real poser is: what is a reasonable reserve?"
Much of the problem faced in Britain has been caused by shortage of runway space in south east England, according to David Reynolds, the head of safety at the British Airline Pilots Association. "The way in which aircraft are being developed in becoming more fuel efficient, there is less need for fuel. However the problem comes when there are delays. The infrastructure in the South East is creaking and you can get cases where people want to know if you have the right amount of fuel to go anywhere."
"The very bad weather that we had in December caused pandemonium in the south-east of England. Aircraft were arriving and finding that they suddenly had nowhere to land because the airfield had closed or everybody else had gone there. That reflects the pressure commercial pilots are under. Flying with too much fuel is expensive because it of the additional weight," said Rob Gifford, executive director of the Parliamentary Advisory Committee for Transport Safety. "But the law the law is tough enough and needs to be regularly monitored," he added.
LIBERAL DEMOCRATS SAY NO
TO NEW RUNWAYS AT LONDON AIRPORTS
Press Release Liberal Democrat Party - 15 August 2012
The Liberal Democrats are pushing for a new strategy for aviation which balances the benefits the industry brings as a driver of jobs and growth with the harm it causes to the environment.
The strategy, which will be put to members at the party's Autumn Conference in a policy motion, reinforces the Liberal Democrats' opposition to new runways at London's airports. Key proposals include:
* Pushing for better use of existing capacity in the South-East and at regional airports to meet short to medium-term demand
* Firmly rejecting Boris Johnson's Thames Estuary airport
* No new runways at Heathrow, Gatwick or Stansted
* An independent, evidence-based study to find a location for a hub airport or a suitable airport to expand into a hub for the long-term
* No airport capacity expansion which could allow for aircraft movements above the carbon emissions cap set by the independent Committee on Climate Change
The Liberal Democrats want UK aviation policy to be based on five key principles: accessibility from north and south; growth within UK carbon budgets; minimal impact on the local population; minimal impact on the global environment and maximum 'hub airport' potential.
The policy is being led by Co-Chair of the Liberal Democrat Parliamentary Party Committee on Transport, Julian Huppert. Commenting, Julian Huppert said: "Liberal Democrats have always opposed a new runway at Heathrow because it is in an appallingly bad location, with a quarter of all those in Europe affected by aircraft noise living under the Heathrow flight path. In the same vein, mixed-mode and night flights would cause unacceptable noise levels and air pollution for thousands of Londoners. You can't have one of the world's noisiest and busiest airports in the heart of West London's suburbs."
"Aviation policy has focused on London and the South East and it is clear that is where the greatest demand lies; but airports and foreign travel for business or leisure must be easily accessible for citizens living across the UK. And noise and air quality impacts have to be minimised. With Birmingham looking to expand, Stansted only half full and Gatwick expanding into emerging markets, regional airports and other airports within London can meet demand for the short to medium term. Especially if we provide them with the transport links they so desperately need.
"We recognise, however, that a single, hub airport - rather than a constrained Heathrow with multiple satellite airports - would be better for the environment and better for the economy in the long term. Even three runways at Heathrow would only be a medium term solution. Aviation has the potential to become one of the greatest threats to the global environment. Unmitigated expansion of aviation would cause the UK to miss its carbon reduction targets."
"Successive governments have failed to come up with a clear strategy which supports the aviation industry while mitigating its impact on the environment and local residents. Now they're in opposition, the Labour Party policy is a blank sheet of paper. They are neither for nor against a third runway at Heathrow. While most Conservatives, with a few notable exceptions, are wavering in the face of big business."
"Enough is enough. The public deserve an airport policy which balances the benefits from aviation with the harms it can do to the environment globally and locally. That is exactly what we'll deliver."
The full text of the conference motion, A Sustainable Future for Aviation will be debated at Liberal Democrat Autumn Conference in Brighton on Sunday 23 September 2012
RYANAIR PROFITS TUMBLE
BUT FARE INCREASES WILL BE LIMITED
Precise News Service, Aviation and Transport - 31 July 2012
The Guardian (Dan Milmo) reports that budget carrier Ryanair admitted yesterday that fare increases will be 'restrained' this winter due to spending cuts and the eurozone crisis as it posted a bigger than expected 29% fall in first quarter profits to ?99m. The airline said yields would be held back this winter, meaning it would not match last year's 16% fare increase, with deputy chief executive Howard Millar saying that fares would rise by about 3% this year. He said Ryanair would like to double the increase but the airline industry was suffering from the economic problems affecting Europe. Revenues rose 11% to €1.3bn, while passenger numbers increased 6% to 22.5m. Ancillary revenues, such as inflight food purchases and car hire deals, performed strongly, rising 8%. Millar also revealed that Ryanair is interested in joining a consortium to buy 25% of Stansted airport.
The Times (Susan Thompson) notes that he said Ryanair was prepared to make a 'modest commitment' as anchor tenant at Stansted. Millar said Stansted is the only place in London where another runway can be built.
The Daily Telegraph (Nathalie Thomas) says Ryanair chief executive Michael O'Leary is in discussions with Commercial Aircraft Corporation of China about an aircraft with wider doors that would allow passengers to get on and off planes in double quick time. Millar said that a plane manufactured by Boeing or Airbus is a 'one-size-fits-all', and that Ryanair wants two people to walk through the door. The scheme is the latest in a line of money-saving initiatives from O'Leary, including standing-only tickets and removing toilets except for one to increase the number of seats.
The Daily Mail (Peter Campbell) adds that O'Leary said he was disappointed he could not charge more for tickets, but demand 'doesn't allow it'. He blamed the fall in profits on the rising costs of aircraft fuel - Ryanair pays 27% more for its fuel than it did last year.
OUR COMMENT: Since aviation fuel is not taxed - a cost benefit long enjoyed by the aviation industry, the government cannot be blamed!
AUSTRALIAN GROUP EYES STANSTED AIRPORT
Rose Jacobs and Anousha Sakoui - Financial Times - 3 August 2012
An Australian infrastructure group has positioned itself as a bidder for London's third-biggest airport, Stansted, after winning the contest to buy a £1bn stake in Manchester Airports Group. The deal agreed with Industry Funds Management, which fought off competition from Hong Kong billionaire Li Ka-shing, is conditional on MAG winning any future contest for Stansted, which UK competition authorities have ordered its owner BAA to sell.
MAG, which is owned by the 10 councils of Greater Manchester, is keen to add Stansted to its four-airport portfolio and this winter laid out plans for a part-privatisation that would raise money for a deal. The agreement with IFM, worth about £1bn according to people close to the discussions, would give the Australian group 35 per cent of MAG's equity but an equal share of voting rights with Manchester City Council.
The other shortlisted bidders were Cheung Kong Infrastructure, the investment vehicle of Li Ka-shing, and a joint venture by UK private equity group 3i and the Abu Dhabi Investment Authority. People close to the contest said IFM offered more money for MAG and promised to put more into a Stansted bid.
The timing of a sale of Stansted remains uncertain because its owner, BAA, a division of Spanish infrastructure group Ferrovial, is still fighting a 2009 order to sell the facility. It is seeking a Supreme Court hearing after having its case rejected by the UK Court of Appeal last week.
Should a Stansted sale go ahead, analysts expect the airport to fetch about £1bn. It is likely to attract a wide range of potential investors, including trade buyers, infrastructure funds and pension funds, with the latter group interested in the safe, inflation-pegged returns offered by regulated airports.
There are also growth opportunities, with passenger volumes down significantly from five years ago. Ryanair, the airport's dominant carrier, has said it has spoken with potential buyers over taking part in a bid. But one person close to the Manchester deal said he would be surprised if the airport group was in talks with the low-cost carrier.
As well as Manchester airport, MAG owns East Midlands, Bournemouth and Humberside airports - though it announced a deal on Thursday to sell its 82 per cent stake in Humberside.
Under the terms of the IFM deal, Manchester City Council will see its equity stake diluted from 55 per cent to 35 per cent. The 45 per cent equity stake held by nine other local councils will be reduced to 30 per cent and they will give up their voting rights entirely.
A Stansted bid would not be MAG's first attempt to enter the London market. Three years ago, it made an offer for Gatwick airport but lost out to Global Infrastructure Partners, which also owns London City Airport and which this year paid BAA £807m for Edinburgh Airport.
IFM has $34bn in funds under management and holds stakes in 26 infrastructure companies in Australia, Europe and the US.
STANSTED SHOULD BE THE NEW HUB AIRPORT
Steve Norris is annoyed with the Telegraph for misrepresenting
his view on coalition transport policy
Steve Norris - Iaindale Online - 5 August 2012
People generally believe what they read in the media until they read something about themselves. That's why blogging is so attractive. You get to know what I think "without benefit of laundry" - the wonderfully evocative title of the late John Peyton's enormously readable autobiography. This is what I think, not what a Deputy Political Editor in the Sunday Telegraph tells you I think on the subject of Tory transport policy. For the record, and in direct contradiction of what is said, I support HS2 and would be happy to argue the case with anyone seriously interested.
But for now, I want to talk about runways. Under a piece headed "Former Tory transport ministers attack coalition over Heathrow and HS2", Robert Watts asserts that Cecil Parkinson, Chris Chope and I "believe the government's delay over its airport policy is damaging Britiain's economic interest". I can't speak for my colleagues, but that would be a bit rich coming from me.
Twenty years ago, John MacGregor's team at DoT of which I was a member was given the RUCATSE file, the acronym for Runway Capacity in the South East, and if Justine Greening wanted to save some money she could tell her officials to dust it off, change the date and reissue it. No-one would notice because nothing has changed, neither under the last Tory government nor under thirteen years of Labour. The original report even had its own version of Boris Island, not least because a Thames Estuary option at Maplin, Cliffe or somewhere near, has been around since the 70s. The problem then, as now, is very simple. No new runway anywhere in the south east will be unopposed. All the choices are tough, ranging from impossibly tough to just very. Every time the subject has been raised the same evidence has been scrutinised by a new group of ministers and then put carefully back in its box. At a time when economic growth is not just nice to have but a vital necessity it is right to look yet again at the options and this time, make a firm decision.
First, the government should reject the option of a third runway at Heathrow. Supporters argue that a single hub airport is vital to Britian's competitiveness and that the only place for it is Heathrow. I challenge both assumptions. New York, London's rival as a world business centre operates two hubs at Newark and JFK. London is big enough to do the same. Ironically, if those who champion increased aviation are correct, the irrefutable logic is that Heathrow, having built a third runway, inflicted appalling pollution on the local area and destroyed hundreds of homes in the process, would then have to build a longer fourth. In that event the toll of damage is unthinkable. Literally thousands of homes would be razed to the ground. It is a completely unacceptable and ludicrous proposition. The Conservatives were right to take that view in their election manfesto. Boris Johnson has stood firm on exactly that ground and Maria Eagle, Labour's Transport Shadow, moved swiftly to put her party in the same spot. The question is not how to expand Heathrow but where to establish a second hub.
Previous reviews discounted Gatwick not least because of the existence of the so-called West Sussex County Council Agreement which effectively means no application there can be forthcoming until 2019. Two decades ago that was a conveniently long way off. Now it is almost on us and I don't doubt that its new private equity owners harbour ambitions to build a second runway. They will have a very tough job on their hands. Both alignments north and south of the existing runway are littered with listed buildings including the odd Grade 1. It is conceivable that one new runway might, just might, succeed after years of trench warfare, but a third really does look out of the question.
The Estuary Hub is a brilliant CGI and an exciting concept linked as it is to a new Thames barrier, the prospect of harnessing tidal energy and most importantly taking those nasty planes a long way out of London. But its weaknesses are compelling. The private investment needed would be in the order of £50 - 100 billion. Crucially it could only be justified by the closure of Heathrow, which Willie Walsh among many others has rightly dismissed as unthinkable. Flight paths would conflict with existing Schipol holding patterns and the proposal is very light on how the new airport would be accessed beyond a broad statement that there would need to be new rail and road connections. Sure, but where and how? Great CGI but bluntly it ain't going to happen.
Which leaves us Stansted, home to Ryanair and few others, ignored by most seasoned travellers not least because of its poor rail connections and a motorway that is two lanes wide in places. Twenty years ago Stansted looked distinctly unappealling as a second hub - but how times change. London now has Crossrail to look forward to. Long overdue, the new railway opens up new opportunities for jobs and development in the whole Thames Gateway. And it can do more. As experienced rail planner Michael Schabas has pointed out, a new line from east of Stratford, first in a 10K tunnel to Fairlop Water and then tracking alonside the M11 to Sawbridgeworth and straight into Stansted is now practicable, buildable and compared to all other options, affordable.
Adding the widening within highway land of the M11 to 3 lanes would still cost around £5bn in total. Capacity exists to run a train every 7 or 8 minutes direct from the airport to Stratford, then Liverpool Street and then much more significantly, to Farringdon, Tottenham Court Road, Bond Street and if necessary right through to Heathrow without the passenger ever having to change trains. The west end stops would be half an hour from the airport. Added to which, the blunt truth is that Stansted is the only London airport on which four runways could be built without disproportionate damage to the surrounding area. Note I don't say no damage. Such a plan would be fiercely and passsionately opposed. But if there has to be a new runway and perhaps another in a decade's time, then the least worst option is Stansted.
Which leads me to my last point. The government is currently issuing National Policy Statements on strategic issues affecting planning for ports, infrastructure, waste, energy and soon. The idea is that NPSs would have to be approved by Parliament but would set a clear framework for planning inquiries. So for example if the relevant NPS says nuclear power is a priority then at an inquiry into a planning application for a new nuclear power station the issues would be precise location, compensation, local impact and so on, but not the principle. Justine Greening could be - should be - the Secretary of State who finally nails the NPS on runway capacity in the south east by naming Stansted as the preferred location, killing the third Heathrow option in the process. Kicking the can down the road for two decades has been convenient for ministers (yes, including me) for literally decades. We can't dodge the decision any longer.
I'm genuinely sorry for those who will be affected by the Stansted option and the state should ensure they are properly compensated, but tough decisions are what government is about. In the national interest we should grit our teeth and make that right decision now.
OUR COMMENT: A tortured argument for Stansted! Additional railways and road extensions also cost money and destroy houses and communities! Is this enlarged Stansted to be a second hub? A rival to Heathrow? Read SSE's evidence detailing the arguments against Stansted's extra runway, proposed in 2009.
UK RISKS BECOMING EC 'WHIPPING BOY'
Aimee Turner - Air Traffic Management Online - 7 August 2012
UK air traffic agency NATS and its national regulator reacted swiftly to reports that Brussels has rounded on the business for charging the EU's highest fees and posting excessive profits.
Under regulations set by the UK's Civil Aviation Authority, NATS recently posted an 18 per cent net profit margin, while its customers - airlines - say they earned a fraction of that, claiming NATS charges the EU's highest rates for overflight.
Britain 'could and should have contributed more' to cost-cutting, the European Commission said in letter sent last month to the UK Civil Aviation Authority. The letter comes at a time when Brussels has already signalled it plans to crack down on those air traffic control agencies that are not working hard enough to radically improve the efficiency of the region's airspace.
A NATS spokeswoman said regulated profits are calculated differently from those at ordinary companies and NATS's fees are increased by pension obligations that many other countries' agencies don?t bear. "While price is important, it is equally important to relate it to the service and value that we provide to airlines, passengers, business, the environment and the wider economy," she said.
A CAA spokesman said the agency balances operational efficiency and NATS's financing needs, and that NATS's charges are set to fall. "The CAA, in both its European and UK statutory roles, will continue to monitor NATS' performance to ensure best value is provided and consumers benefit from the delivery of effective and efficient air navigation services," it said.
NATS' revenue for the year to 31 March increased by £88 million to £865 million, while pre-tax profits rose by £89 million to £195 million.
At the time NATS posted the figures Richard Deakin, chief executive, said: "We are acutely aware of the high cost to our airline customers of delay and flight inefficiency. This explains our focus on continuing to provide the highest standards of safety, environmental and service performance, cost-effectively. We believe this delivers the greatest economic value. We are looking to find innovative solutions that add even more value in the future. For example, if we deliver on flight efficiency targets, enabling our customers to save 600,000 tonnes of CO2, we will reduce their fuel bill by some £120 million at today's prices."
"And increasingly we are seeking to enhance these outcomes by working collaboratively with other air navigation service providers under the European Commission's Single European Sky programme."
An interesting aspect of the positive business performance was that it seemed to have persuaded the UK Government to pull the sale of its significant, controlling stake in its national air traffic agency. Transport Minister Justine Greening persuaded her colleagues to reject any sale of the government's 49 per cent ownership stake in NATS.
Some media reports suggested that this was motivated by the 'risk of the political and financial consequences of handing control of Britain's skies to Berlin' in reference to the widely known interest expressed by DFS, Germany's ANSP, in buying at least some of those shares. In fact, Greening admitted she was also focused on short-term government revenue considerations, noting that the government currently receives hefty dividends on its NATS shares, as opposed to only a one-time gain from selling them.
The news of the ditched sale disappointed industry observers who believe that consolidation of Europe's fragmented airspace - which would produce huge efficiency gains - will require not merely the creation of cross-border FABs but the actual merger of ANSPs as the precondition for serious consolidation of en-route centres from the current 63 to a much smaller number.
"A partial merger of two of the biggest ANSPs, DFS and NATS, would be a giant step in that direction," said Bob Poole of the Reason Foundation "Instead of just complaining about the high cost of Europe's fragmented air traffic control, they should take a positive step towards solving the problem."
PLANES MAY PAY FOR NOISE OVER HEATHROW
Tory group proposes compensation to break deadlock
over expanding capacity in South-east
Nigel Morris - The Independent - 2 August 2012
Residents under Heathrow's flightpath could be offered thousands of pounds in compensation if a future government gives the go-ahead for a third runway at Europe's busiest airport. The payments are being promoted as a possible way of defusing anger in those communities worst affected by noise following any expansion of Heathrow.
The Coalition agreement has ruled out giving approval to a third runway during this parliament and the Conservatives opposed the move at the last election. But some senior party figures, including the Chancellor, George Osborne, are pressing for a change of policy to boost airport capacity in the south-east. The most likely option is that the issue will be left open in the next Tory manifesto.
The Free Enterprise Group of Conservative MPs, which has close links with Mr Osborne, has called for a noise compensation scheme as a way of bringing around families affected by the extra noise.
BAA, which operates Heathrow and other airports, said it was keeping an open mind on the different options available for expanding capacity, stressing that the decision was one for political leaders. "The big constraint on Heathrow is noise," Colin Matthews, the chief executive of BAA, told the Financial Times. "People will debate the relative merits of providing people with double-glazing versus providing people with financial compensation."
Supporters of the compensation proposal - which would be funded from BAA's increased profits - believe it would blunt local campaigns against airport expansion. A range of compensation schemes are already available to families affected by excessive airport noise, including cash towards relocation costs and free secondary glazing for windows. Payments could be particularly generous under the latest proposal: the the Free Enterprise Group has suggested payments of up to £40,000 for the most affected.
Relieving the pressure on airspace in the south-east is one of the trickiest problems facing political leaders. Justine Greening, the Transport Secretary, is at odds with some of her Cabinet colleagues because of her strong opposition to expanding Heathrow. The Liberal Democrats and several prominent Tory MPs, including Zac Goldsmith, also oppose expansion of Heathrow. There is also resistance to expansion of Gatwick and Stansted airports.
Building a new airport in the Thames estuary - either the "Boris Island" plan backed by the London Mayor, Boris Johnson, or a £50bn proposal for an airport near the Kent coast - would be hugely expensive and take many years to complete.
Problems over the Coalition's policy were underlined in mid-July when Ms Greening scrapped plans to start consultation on future airport capacity in the south-east. Consultation has been delayed until the autumn at the earliest - and the expectation is that the Tories will not even make a firm proposal in their next manifesto.
WHAT'S IN A NAME? THE TREASURY'S GREEN TAXONOMY
Phillip Ward - 26 July 2012
The Treasury has finally settled on its definition of a green tax and it is a narrow one. Why? - because the Coalition agreement included a commitment to double the proportion of total taxes represented by green taxes. The smaller the amount of tax take that is included within the definition, the less the Government will need to do in order to meet its commitment.
A tax will therefore count as green only if it is explicitly linked to the Government's environmental objectives; its primary objective is to encourage environmentally positive behaviour change; and it is structured so that the more polluting the behaviour, the greater the tax levied.
On this basis, the Government has determined that only the:
Climate Change Levy
will count as green taxes. Forecasts provided by the Treasury show the yield from these taxes growing from £2.5bn last year to £6.6bn in 2015. That looks a lot but it is in fact an increase from approximately 0.5% to 1% of the total projected tax take.
EU Emissions Trading System (EU ETS)
Carbon Reduction Commitment Energy Efficiency Scheme; and
Carbon Price Support
Excluded from the list of green taxes are those which, while impacting on environmental behaviour, are deemed to be essentially about revenue raising. These include three taxes which are having a big impact on some of our most polluting behaviours: vehicle excise duty, fuel duty and air passenger duty.
Call of duty
A few things leap out at me from this announcement. First, the Chancellor is not going to put himself on a hook that might require him to raise fuel duties except on his own terms. After the fiasco with the cancellation of the planned August rise and his humiliating U-turn, that is perhaps not surprising and arguably fuel prices are already sufficiently high to keep driving fuel economy for now.
But one down side of the narrow definition he has chosen is that it seems he needs to do nothing else on green taxes in this Parliament in order to achieve the Coalition's commitment, assuming that the OBR's projections of the yields of the different taxes are realistic. The take from Landfill Tax, which is projected to rise significantly while waste volumes are expected to fall, is already being challenged. The Chancellor is not of course barred from exceeding the commitment but this looks like a clear signal that he is not interested in creating additional taxes specifically to change environmental behaviours - although further revenue raising is not ruled out.
I don't even see an upside here in a reduced interest by the Treasury in other environmental policies like the PRN system. They will still regard these as taxes - just not green taxes - and insist on having the final say as they do now.
Shifting the burden
The fact that surprised me most in this announcement is the low proportion of the total tax take represented by green taxes. At a time when for both economic and environmental reasons, there is an arguable case for shifting the burden of taxation from labour to consumption, there seems to be no ambition to explore other options. It means that the letter of the Coalition Agreement will be met but not its spirit.
The Chancellor, of course, has form on green scepticism and no doubt that is partly reflected in these decisions. But there is also a fair measure of political and operational reality involved. With staff resources and morale falling at HM Revenue and Customs and a pressing need to increase the efficiency of the big earner taxes, diverting resources to setting up new green taxes is bound to get a lower priority. Introducing taxes that impact on the rate of consumer inflation can play havoc with index linked benefits and pensions, as we saw with the increase in VAT and the fuel duty escalator, quite apart from their political unpopularity.
So is this the end for green taxes? I think we are certainly entering a quiet period, but there seems still to be scope to argue for revenue raising to be done in a way which encourages better environmental behaviours. In the longer term, those interested in shifting the burden of tax will need to help politicians understand better how this can be done while managing the downsides. I offer as an example the Climate Change Levy, where the potential impact on big energy users was offset by offering a lower tax rate in exchange for sectoral agreements to achieve energy saving targets.
BAA LOSES STANSTED LEGAL CHALLENGE
Airport operator BAA has lost its latest challenge against
a decision forcing it to sell Stansted Airport in Essex
UK Press Association - 25 July 2012
The appeal by the Spanish-owned company was rejected by three Court of Appeal judges in London.
In 2009 the Competition Commission (CC) ruled that BAA must sell Stansted in Essex and two of its other UK airports. BAA has since mounted a series of unsuccessful legal challenges against the decision.
Earlier this year BAA lost an appeal before the Competition Appeal Tribunal. In their ruling Lord Justice Mummery, Lord Justice Rimer and Lord Justice Sullivan dismissed BAA's challenge against the decision of the appeal tribunal.
Since the CC decision, BAA has sold Gatwick Airport in West Sussex and, faced with having to dispose of either Edinburgh Airport or Glasgow Airport, it has opted to sell Edinburgh.
The Competition Commission (CC) said it welcomed the Court of Appeal's decision.
Laura Carstensen, chairman of the BAA Remedies Implementation Group, said: "We are pleased that our decision on Stansted Airport has once again been upheld. It remains the right decision in the interests of passengers and airlines and it is surely now time for BAA to accept the verdict and proceed with the sale."
BAA said in a statement: "We are disappointed that the Court of Appeal has ruled in favour of the Competition Commission. We will now consider its judgment carefully and we intend to submit an appeal to the Supreme Court."
BAA: FORCED SALE OF STANSTED
WILL 'DISCOURAGE' FOREIGN INVESTORS
Heathrow-owner BAA has cautioned that Britain is at risk
of discouraging foreign investment in UK infrastructure
Nathalie Thomas - Daily Telegraph - 25 July 2012
BAA has warned that a forced sale of Stansted airport in the current depressed market will discourage foreign investors from backing UK infrastructure projects. The airports operator cautioned against sending the wrong signal to overseas investors as it awaits the outcome tomorrow of its final appeal to keep hold of Stansted.
A ruling is expected in the latest twist in a three-year legal battle between BAA and the Competition Commission, which in 2009 ruled that Stansted must be sold. If tomorrow's judgment from the Court of Appeal doesn't go BAA's way, the airports operator will be forced to sell the Essex airport according to a timetable laid out by the Commission.
Stansted has been haemorrhaging passengers since 2007. BAA's half-year results on Wednesday showed that passenger numbers at Stansted slumped 4.5pc to 8.2m during the six months to June 30. In stark contrast, Heathrow broke a new record of 33.6m travellers during the first half, up 2.2pc on 2011.
Colin Matthews, chief executive of BAA warned a sale of Stansted during the current climate would have a "damaging impact" for shareholders.
"Those are the same shareholders by the way who are currently investing £100m a year in Heathrow," he said. "You can't think why the country as a whole would wish to discourage inbound flows of equity because we depend on that to fund infrastructure. I think the country should be welcoming foreign capital and a forced sale of Stansted is damaging the interest of shareholders."
Mr Matthews argued that when UK consumer confidence picks up, Stansted "will be growing faster than any other airport". "Stansted is very dependent on UK consumer confidence and that is not high at the moment," he added.
Revenue at BAA, which owns five UK airports, jumped 8.4pc to £1.2bn while pre-tax losses narrowed from £249.2m to £50.9m.
RYANAIR WELCOMES COURT OF APPEAL REJECTION
OF BAA'S 7TH APPEAL AGAINST SALE OF STANSTED
Calls for early sale to prevent further BAA mismanagement
as Stansted traffic falls by 600,000 pax in H1
Ryanair Press Release - 26 July 2012
Ryanair, Europe's only ultra-low cost airline, today (26 July) welcomed the Court of Appeal rejection of the BAA monopoly's 7th appeal against the sale of London Stansted Airport, as recommended by the Competition Commission (in 2008). Ryanair called for the early sale of Stansted, where the BAA has presided over declines of 600,000 passengers in the first half of 2012, while Heathrow and Gatwick grow. This proves the BAA monopoly is damaging Stansted and harming consumers.
Ryanair dismissed the absurd comments of BAA CEO, Colin Matthews, who this week claimed that Stansted was "a barometer of UK consumer spending" and added "when the UK consumer is confident again, we'll see growth quicker there than anywhere else". Ryanair called on Mr Matthews to explain why Heathrow and Gatwick are growing, while BAA Stansted is raising prices and declining.
Ryanair?s Stephen McNamara said: "Ryanair welcomes today's rejection by the Court of Appeal of the BAA's 7th appeal against the sale of Stansted, as first recommended by the UK Competition Commission back in 2008, over four years ago. It is now time for Colin Matthews and Ferrovial, the Spanish owners of the BAA, to stop delaying the sale of Stansted and instead get on with it. Since 2008 the BAA have doubled prices and Stansted and seen traffic decline from 24m in 2007 to 18m in 2011."
"These repeated BAA court appeals are nothing more than a blatant attempt to delay the sale while BAA and its Spanish owners, Ferrovial, fatten up its monopoly profits at the expense of airlines, passengers and British jobs. This scamming by the BAA and Ferrovial must now end before even more traffic is lost at Stansted."
LEGAL EXPERT SAYS BATTLE FOR STANSTED MAY BE OVER
Travelmole Online - 27 July 2012
A legal expert says it will be difficult for airports operator BAA to continue its fight to hold on to Stansted after the Court of Appeal ordered the sale to go ahead.
BAA announced immediately after yesterday's ruling that it would take its battle to the Supreme Court, which is the highest court of appeal for civil cases in the UK. However, Bruce Kilpatrick, head of the City competition law team at Addleshaw Goddard, said it wouldn't be easy for BAA to secure leave to appeal any further.
Three Court of Appeal judges yesterday upheld a 2009 ruling by the Competition Commission that BAA must sell Stansted, Gatwick and either Glasgow or Edinburgh airports. BAA has already sold Gatwick and Edinburgh, but it has waged a three-year battle to be allowed to keep Stansted, arguing that the airport serves a completely different market to Heathrow, which it also owns.
Kilpatrick said Thursday's ruling that BAA must sell the Essex airport was no surprise. "It was always going to be difficult for BAA to overturn the judgement on appeal," he said. "BAA will obviously be disappointed and it will be difficult for them to secure leave to appeal to the Supreme Court.
BAA may be getting close to the end of the line in this case, however, they will want to explore all avenues in order to delay the timetable of the sale."
BAA has 28 days to appeal.
Ryanair, one of Stansted's largest customers, welcomed the appeal court ruling and repeated its call for the early sale of the airport, where traffic is continuing to decline this year. Spokesman Stephen McNamara said: "These repeated BAA court appeals are nothing more than a blatant attempt to delay the sale while BAA and its Spanish owners, Ferrovial, fatten up its monopoly profits at the expense of airlines, passengers and British jobs. This scamming by the BAA and Ferrovial must now end before even more traffic is lost at Stansted."
Ryanair claimed that since 2008, Stansted has doubled its charges yet traffic has fallen from 24m in 2007 to 18m last year.
TRIPLE TOUCHDOWN AT STANSTED AIRPORT
PLANE spotters were seeing triple at Stansted Airport this week
with a first for the Uttlesford hub - three British Airways
Boeing 747-8 freighters on stand at once
Herts & Essex Observer - 23 July 2012
British Airways World Cargo took delivery of the first of three Boeing 747-8 Freighters late last year, but it is the first time all three have been seen at Stansted together. The jets are the biggest aircraft on the UK register and serve destinations across the world including Hong Kong, Shanghai, Chicago, Delhi, Nairobi, Madrid and Johannesburg. Stansted is already London's second busiest cargo airport and third overall in the UK.
A spokesman said: "These planes increase our operational capabilities and provide a boost to businesses in the region looking to expand and exploit new markets and opportunities. We have invested millions in upgrading our infrastructure to accommodate the new generation of super jets, and in 2010 we gained official approval to operate the world's largest aircraft. These fantastic aircraft also bring significant environmental benefits as they are 30 per cent quieter and produce 16 per cent less emissions than the aircraft they replace."
OUR COMMENT: The 747-8 has replaced the 747-400 freighter. When the spokesman said "the 747-8 are 30% quieter" he is being disingenuous. It is playing with logarithms which do not represent what people actually hear. It's merely a system used by acousticians to make the huge range of human audibility manageable in numerical terms. The human ear can detect sound at very low sound pressures and the range to the deafening level of pain is 10 to the power 14. That's an increase of one hundred thousand million times more than the level of onset of audibility.
In fact the difference between the 747-8 and the 747-400 is in the range of 3 to 6 decibels depending on aircraft power settings and attitude. A difference of 3 to 6 decibels sounds good, but is the amount of change in logaritms that is just detectable by the human ear. In fact even the BAA noise expert admitted under SSE cross examination at the G1 Inquiry that a change of 3 to 6 decibels was at the edge of detectability. To give any meaningful reduction requires at least a 10 decibel change.
All aircraft are intrinsically noisy. And there are no technical enhancements in sight that will reduce this. And more aircraft means more noise.
Martin Peachey SSE adviser on aviation noise.
IAG CANCELS BOND BACKED BY HEATHROW SLOTS
Andrew Parker - Financial Times - 20 July 2012
International Airlines Group has pulled plans for an innovative bond that would have used take-off and landing slots at Heathrow airport as collateral. This is believed to have been the first time that a European airline had sought to issue a bond backed by airport slots, although a similar practice is common in the US.
Analysts said the unorthodox nature of IAG's bond probably explained its failure, with some going on to highlight investor concern about the company's ability to fund its aircraft purchase programme.
IAG, parent of British Airways and Iberia, said it had decided not to pursue the bond because "there was a lack of demand for this bond at a price which would compare with other financing alternatives".
The company was seeking to raise at least £250m through the bond, and use some of the proceeds to cover the cost of restructuring BMI British Midland, the airline bought by IAG from Lufthansa in April.
Analysts said some proceeds might also have been used to purchase aircraft, adding that bonds backed by airport slots amounted to a potentially attractive diversification of IAG's funding sources.
Take-off and landing slots at Heathrow are much sought after because it is operating at near full capacity, and the airport is the main route into Europe from the US. Neil Glynn, analyst at Credit Suisse, said: "IAG's decision not to progress with the bond issue may suggest difficulty in valuing Heathrow slots as collateral."
OUR COMMENT: Should airport slots be available to trade in the financial markets?
NO CHANGE OF MIND OVER THIRD RUNWAY, SAYS GREENING
Nicholas Cecil - Standard Online - 16 July 2012
Transport Secretary Justine Greening today insisted she will not back down over a third runway at Heathrow - as Gatwick made a bid to solve London's aviation crisis.
Putney MP Ms Greening was challenged about the airport after David Cameron appeared to soften his stance on expansion. Pressed on BBC Radio 4's Today programme on whether she was personally shifting her stance on Heathrow expansion, she bluntly replied: "I'm not."
This week Gatwick will flesh out plans to increase passenger numbers by 12 million from 34 million a year with its existing runway and two terminals.
Its proposals also outline a scenario for a second runway, and possibly another terminal, to be built after 2019, taking passenger numbers to 70 million a year. Gatwick is building air links to emerging economies as it tries to become a business rival to Heathrow.
Ms Greening stressed the Coalition agreement, opposing more runways at Heathrow, Stansted and Gatwick, stood and she denied the Government was changing its position.
GOVERNMENT SCRAPS NATS SALE PLANS
Transport Secretary Justine Greening said it was best for taxpayers if the
Government retained its shareholding in air traffic control company Nats
UK Press Association - 11 July 2012
The Government has scrapped plans to sell its 49% stake in air traffic control company Nats. Transport Secretary Justine Greening said it was best for taxpayers, travellers and Nats if the Government retained its shareholding.
The decision was welcomed by the Prospect union, which represents more than 3,000 air traffic controllers. But Prospect said "all eyes would now turn" on the Airline Group - a body of seven airlines including British Airways and Virgin Atlantic - which owns 42% of Nats. There has been interest in Nats from Germany's state-controlled air traffic control body, Deutsche Flugsicherung, which could also be keen to buy the Airline Group's stake.
Ms Greening said the response to a call for evidence about the Government's Nats' shareholding had "highlighted the strategic importance of Nats to the UK and the far-reaching implications of a sale at this time". She said these included the continued development of the Single European Sky agenda - an EC initiative by which the design, management and regulation of airspace will be coordinated throughout Europe.
Ms Greening said she had also considered the ongoing work on the Single European Sky Air Traffic Management Research programme. "After considering these factors, I have concluded that it is in the best interests of the British taxpayer, the travelling public and the company itself to retain the Government's shares in Nats at this time."
Prospect national secretary Garry Graham said: "The Government has clearly listened to the representations made by stakeholders for safety and service delivery to remain paramount, and for the UK to continue to have an authoritative voice in Europe, particularly during the development of the Single European Sky initiative."
He went on: "All eyes will now turn to the Airline Group - and their intentions. The need for stability and a commitment to safety and service delivery should be at the heart of any decision that they make. They purchased their stake because they had a vested and visceral interest in safety and service delivery. We are concerned that their position is now focused on short-term commercial gain."
OUR COMMENT: Is it time for the legal position be clarified with regard to travel through national air space?
CUT-PRICE FLIGHTS TO AMERICA ON THE HORIZON AS
GOVERNMENT ANNOUNCES PLANS FOR CARRIERS
TO FLY FROM 'CHEAPER AIRPORTS'
Rivals to Heathrow - Gatwick, Stansted, and Luton -
may be able to cut landing fees to attract airlines
Martin Robinson - Daily Mail - 13 July 2012
The cost of transatlantic flights could be slashed after the Government announced it would allow more international airlines to use Gatwick, Stansted and Luton.
A price war is being predicted that could break Heathrow's stranglehold on routes to America because rival airports will be able to reduce their landing fees. The proposals set out in the Government's draft aviation strategy come after ministers were put under intense pressure to enable UK airlines to cash in on growing markets across the world.
Spreading the routes across other UK airports could make more routes financially viable, experts claim, and it could also increase the number of flights between the two countries. It would also benefit people who pick up flights from America stopping over in Britain on the way to Asian destinations like Japan and China. And the frustrating long immigration queues for those trying to enter America could also be cut for passengers.
Talks between US and British officials have already started to allow the four million Britons who go there every year to be cleared for entry at the UK airport they leave from. Meanwhile the Government is still to set out its plans to solve the lack of runway space in south-east England - where the majority of people fly from.
The controversial plans to add a third runway at Heathrow or Boris Johnson's idea of a huge new airport in the Thames Estuary remain the two main options. Critics say the lack of a decision will damage the British economy, and it is claimed the Coalition is split over the issue.
But Transport Secretary Justine Greening says no decision can be made until the options are sure to be economical and green, which has infuriated industry leaders.
"The Government cannot keep kicking this issue into the long grass while our competitors gain at our expense," Simon Buck, chief exec of the British Air Transport Association told the Telegraph.
Baroness Valentine, chief executive of business pressure group London First added: "Difficult decisions on the location of additional hub airport capacity cannot be avoided."
The aviation strategy also includes stricter fines for noisy aircraft to protect people whose lives are blighted by it. Any breaches of noise limits would lead to a £1,000 fine, doubled from the current £500.
FOUNDATIONS LAID FOR FUTURE GROWTH OF AVIATION
AS GOVERNHMENT UNVEILS LONG-TERM STRATEGY
Department for Transport Press Release - 12 July 2012
More frequent flights to emerging markets, improved access to airports - including £500m towards a new rail link to Heathrow - and a reduction in the impact of airports on local communities is to be put at the heart of UK aviation strategy Transport Secretary Justine Greening has said, as she published the Government's long-term vision for the sector today.
The draft policy framework, which will form the basis of future sustainable aviation growth in the UK, has been developed following discussions with the industry. The framework also includes a package of measures which will quickly deliver operational improvements and boost economic growth within existing airport capacity constraints.
The measures include:
* Further liberalisation of the UK aviation market to encourage foreign airlines to develop routes from airports other than Heathrow;
* Improving reliability and reducing delays at Heathrow. If operational freedoms show clear benefits in terms of resilience, reducing delays and allowing planes to land more effectively, thereby reducing the impact of noise for residents under the flight path, then the Government will consult on making these benefits permanent;
* Addressing the environmental and local impacts of aviation through:
- pushing for international action on aviation emissions while continuing to support EU Emissions Trading Scheme;
- incentivising noise reduction though higher landing fees for noisier aircraft at unsociable hours and higher penalties for breaching noise limits at any time;
* £500m towards a western rail link to Heathrow, which is in addition to £1.4bn already being invested to improve surface access to airports, including £44m towards upgrading Gatwick Airport station and a new fleet of thirty electric trains already improving services on the Stansted Express. In addition the Government is pressing ahead with HS2 which will significantly improve access to airports such as Birmingham and Manchester;
* Improving efficiency at the border, including a review of the UK?s visa regime, bringing forward the recruitment of 70 additional border staff at Heathrow and working with the US authorities to look at the options for speeding up entry into the US.
* Supporting the introduction of new rules by airport operators to maximise their existing capacity, for example through limiting access to smaller aircraft;
* Introducing airport performance charters which will set out the level of service that airlines and their passengers should expect from airport operators;
* Improving the overall passenger experience through the Civil Aviation Bill which is expected to gain Royal Assent in 2013.
A separate call for evidence on how to maintain the UK's international connectivity and hub status will follow later in the year once the industry has had time to consider the measures put forward for consultation today.
Transport Secretary Justine Greening said: "This framework aims to strike a balance between allowing the aviation industry to make the most of our current capacity, while also recognising the need for a tough regime to tackle levels of noise experienced by residents on the ground. London is already one of the best connected cities in the world, but there is still an important but challenging debate to be had on how we accommodate the long-term growth of aviation. This framework provides the building blocks for this debate and I look forward to working with the industry, residents and other interested parties on this once they have had the chance to consider these measures."
Today's draft Aviation Policy Framework document has been published on the Department for Transport's website and is subject to full public consultation, lasting until 31st October.
Notes to editors
1. The Aviation Policy Framework consultation document is available on the Department for Transport website.
2. Today's publication follows an exercise last year to seek industry and other stakeholder views on the future shape of aviation policy through the scoping document: Developing a Sustainable Framework for Aviation.
3. The Western Rail Access to Heathrow project will be included in the Government's forthcoming High Level Output Specification for the railways (HLOS) announcement. The project is subject to a satisfactory business case and the agreement of acceptable terms with the Heathrow aviation industry.
OPPONENTS HIT BACK AT INDUSTRY CAMPAIGN ON APD
Airport Watch - 6 July 2012
AirportWatch (AW), the national umbrella organisation opposing unsustainable airport expansion, has hit back at the aviation industry's A Fair Tax on Flying campaign with its own Fair Tax on Flying campaign - suggesting that the £8 billion plus tax subsidy the aviation industry already enjoys must be reconsidered.
Next week Virgin is expected to spearhead a new assault on Air Passenger Duty. John Stewart, Chair of AirportWatch, said, "Every summer as regular as Wimbledon or Henley, the aviation industry pops up with a campaign calling for an end to taxing people's holidays. Every year the industry glosses over the considerable tax-breaks it enjoys through tax-free fuel and an exemption from VAT. Air Passenger Duty would need to rise four-fold to make up the difference."
Air Passenger Duty was introduced by Kenneth Clarke when he was Chancellor in the early 1990s to begin to compensate the aviation industry's non-payment of fuel duty and VAT.
AirportWatch Communications Director Susan Pearson said: "At a time when we are all tightening our belts, the aviation industry's campaign to end or reduce Air Passenger Duty is distinctly unpalatable. Compared to road users, the aviation industry is saving itself £8 - 9 billion, which could be available to the public purse. We believe the aviation industry should be made to pay its fair share of the national tax burden."
The new AirportWatch website can be found at www.fairtaxonflying.org.uk
Notes to editors
1] Motorists pay 58p a litre in fuel duty + VAT at 20%. Thus petrol tax is at a rate of approx 160%. Tax on aviation fuel is 0%.
2] The Treasury estimated in October 2009 that the loss of revenue as a result of no fuel tax and no VAT on airlines was at least £10 billion a year. With the increase in fuel tax and VAT since then, the figure is now between £10 - 11 billion. See www.fullfact.org.
Airlines paid around £2.6 billion in APD in 2011/2012. This is expected to reach £2.8 billion in 2012/2013. But lost revenue to the Treasury of £10-11 billion per year, and the tax take from APD is the figure by which aviation is effectively subsidised. i.e. £8 - 9 billion per year.
The Treasury has reiterated that APD is not an environmental tax. It was instituted in order to - in a small way - compensate for the aviation industry's non-payment of fuel duty and VAT. This is on Page 10 of Treasury document "Reform of Air Passenger Duty: December 2011- response to consultation".
3] AirportWatch is an umbrella movement uniting the national environmental organisations, airport community groups, and individuals opposed to unsustainable aviation expansion. Its members and supporters include the Aviation Environment Federation, Friends of the Earth, Greenpeace, the Campaign to Protect Rural England, the Campaign for Better Transport [formerly Transport 2000], the Woodland Trust, the World Development Movement, Environmental Protection UK, the National Trust and the Royal Society for the Protection of Birds - and many more.
DON'T FLY - SUPPORT TEAM GB
British Airways Website - July 2012
This Summer, the greatest sports event on Earth comes to London. And our best sportsmen and women have a once in a lifetime opportunity, to compete at the highest level with the whole country behind them. That's why we're asking the nation to join together, to give our athletes the greatest home advantage we can give them. It could be the difference between silver and gold. This Summer, there's nowhere else in the world to be.
Flying during the games?
If you are flying with us during the Games, we are operating a full service as normal and we're giving you every opportunity to get behind Team GB and ParalympicsGB while on your travels.
Click here to take the plane down your street
Flying during the Games?
If you are flying with us during the Games, we are operating a full service as normal and we're giving you every opportunity to get involved while on your travels.
? You can keep up to date by watching all the exciting action on screens in our lounges in all airports.
? You can pick up a Supporters Booklet at the boarding gate, containing information on how you can support Team GB and ParalympicsGB while travelling.
? And once you are on board, you can enjoy our 'Journey to London 2012' programmes and news updates on our in-flight entertainment.
? A delicious Olympic-inspired menu option, created by Michelin-star chef Simon Hulstone, will be served on most of our long haul flights from July until the end of September.
? A great choice of flight times to centrally located airports makes it easy for you to plan your journey around key events of the Games.
? Every day of the Games that one of Team GB win a medal, Executive Club members can earn extra Avios. Find out more. Terms and conditions apply.
OUR COMMENT: Confused? Aviation's new Green Policy?
LET THE MANY DECIDE AIRPORTS, NOT THE FEW
Andrew Neather - Standard Online - 6 July 2012
Another day, another solution to London's supposed airports crisis. This time Lord Sugar is talking up more flights at Stansted. Last month the Mayor called for a second runway there.
Whichever the solution - expansion at Heathrow, Stansted, Gatwick or a new airport - the industry's lobbyists are in overdrive. Apparently we're about to become a backwater sleepier than Budleigh Salterton unless we build a third Heathrow runway immediately.
Perhaps a bigger Stansted's the answer. But the industry's projections are based on essentially unlimited oil supplies: rising oil prices could put a big dent in those passenger numbers. Meanwhile a report last year found that Heathrow had more flights to major business destinations than its two nearest rivals, Paris Charles de Gaulle and Frankfurt, combined. It has far more flights to Asia than either.
Last week Stewart Wingate, Gatwick CEO, dismissed the claims that London was falling behind rivals. For, in fact, expansion at Heathrow or Stansted is designed primarily to benefit the business models of BAA and of BA, the latter shifting vast numbers of transfer passengers through its Heathrow hub.
There's an authoritarian subtext to a lot of the complaints from industry figures, such as BA chief Willie Walsh at this paper's airports debate last week. They rail about politicians needing to show "leadership" and accuse them of "dithering". I suspect what they really mean is politicians failing to do exactly what the industry wants.
And they talk wistfully about the ability of China to construct vast airports with no more ado than summoning a stewardess for a refill. But there's a good reason we can't: it's called democracy.
For as Putney MP Justine Greening wrote in this paper in March 2008 of Heathrow: "Rarely has an issue galvanised my constituents so much." Industry apologists like to portray their opponents as anti-business tree-huggers. In fact, it's mostly Tory-voting rural and suburban dwellers at the barricades.
Thus west London Tory MPs have been among the most vocal opponents of Heathrow expansion, as has Boris Johnson. Popular fury is why the Government cancelled Labour's go-ahead for a third runway. I's also why Stansted's MP Tim Yeo opposed expansion of that airport (though he now supports a bigger Heathrow).
Now the Government is said to be wavering. As Greening wrote, "If? ministers push ahead, they should not be surprised if residents ask just who this Government is there to serve - because it doesn't seem to be Londoners."
Greening is now Transport Secretary. I hope her decision on airport expansion reflects the wishes of London's voters - not those of a small and well-funded industry lobby.
CAMPAIGNERS SAY HEATHROW RUNWAY IS 'FIGHTING HISTORY'
ITV News - 8 July 2012
The Heathrow residents group Hacan has claimed the group of MPs who are proposing a third and fourth runway at Heathrow are 'fighting the tide of history'. Tomorrow a group of Conservative MPs are expected to call for two more runways at Heathrow to stimulate the economy.
Hacan Chair John Stewart said: "These MPs are fighting the tide of history if they believe it is possible to build one, let alone two, new runways at Heathrow. All the political parties have recognised the difficulty of expanding Heathrow and are officially opposed to a third runway."
The Civil Aviation Authority revealed earlier this year that 725,000 people live under the Heathrow flight paths - 28% of all people disturbed by aircraft noise across the whole of Europe.
STANSTED RUNWAY FEARS QUASHED
The Government will stand by its plan to refuse requests for
additional runways at Stansted airport, Cambridge's MP was told
Cambridge News - 3 July 2012
Julian Huppert quizzed Transport Secretary Justine Greening in the Commons following hints the scheme - ruled out by the Government's coalition agreement - could be back on the table.
Ms Greening replied: "The coalition agreement, in its entirety, stands."
Boris Johnson, mayor of London, is reported to have called for a second runway at Stansted. After the debate, Dr Huppert said: "We successfully fought off plans for a second runway at Stansted Airport and I want to see it remain that way."
NEW FUNDING PLAN EYED FOR ESTUARY AIRPORT
Rose Jacobs and Andrew Parker - Financial Times - 8 July 2012
Ambitious plans for a new hub airport in the Thames estuary could be achieved without forcing airlines to fund the project through steep increases in user fees, according to proposals by Lord Foster, the architect behind the project.
Among the many objections to an estuary airport, the £20bn-plus price tag looms large, with industry insiders concerned that airlines would face a trebling of landing charges at the site as its owners tried to recoup their investment. That, in turn, could result in higher air fares and undermine the airport's competitive appeal.
But the designers and consultants working with Lord Foster, who last year unveiled a master plan for a four-runway airport 30 miles east of London, have devised a funding model they claim would avoid any significant increase in the landing charges currently paid by airlines at capacity-constrained Heathrow. Lord Foster's team has identified a means of raising £33bn to pay for the estuary airport - principally money secured through landing charges and the closure and redevelopment of Heathrow.
However, this funding model would hinge on the support of the government and regulators, plus the co-operation of the consortium that owns Heathrow, led by Spain's Ferrovial.
David Cameron, prime minister, last month hinted his previous enthusiasm for an estuary airport was cooling, and that the Conservatives could drop their opposition to a third runway at Heathrow. But Lord Foster said: "A third Heathrow runway is not a long-term solution - [it's] more in the band-aid tradition. A new airport would take the same time to get planning permission, but would give us the capacity we need for decades to come."
Lord Foster's team said the new estuary airport would cost £20bn to build, and a further £3bn would be needed for a rail link connecting the site to the high speed line between the Channel tunnel and St Pancras station, taking the total bill to £23bn. In identifying up to £33bn to pay for the estuary airport, Lord Foster's team is proposing to take £8bn from the landing charges levied on airlines using Heathrow between 2018 and 2028. A further £11bn would be raised through landing charges levied at the new airport during the decade after its opening, which is earmarked for 2028.
Meanwhile, the closure and redevelopment of Heathrow would secure £10bn for the estuary airport. Finally, £4bn would be obtained from the development of land around the new airport for facilities needed to support it.
Mike Forster, a former executive at BAA, Heathrow's operator, who is now working with Foster + Partners, said if the government swung its support behind an estuary airport, landing charges could be frozen at 2018 levels plus inflation because Heathrow would require minimal investment thereafter.
While this funding model would appear to deprive Heathrow's owner of the returns it is due, Lord Foster's team believes the problem could be overcome by giving the Ferrovial-led consortium the opportunity to take a controlling equity stake in the estuary airport.
Mr Forster says a special-purpose vehicle created to build the new airport could raise its own funds - with some of the risk underwritten by government - and be reimbursed principally from the money secured from landing charges and the closure and redevelopment of Heathrow. He stressed the £33bn that has been identified to pay for the airport was based on estimates and assumptions that could be revised, but said the funding model was viable and would avoid big increases in landing charges.
Lord Foster's team has put the funding model for the estuary airport to airlines, BAA, which is owned by the Ferrovial-led consortium, and the Civil Aviation Authority.
The CAA said it welcomed Lord Foster's input, but warned: "Given the many challenges of delivering aviation capacity, it is important to generate broad agreement about long-term objectives before focusing in-depth on specific projects."
The government is due to publish an aviation strategy document this summer, but internal tensions inside the coalition mean ministers may not reach any decisions about the UK's hub airport capacity crunch before the next election. Huw Thomas, a partner at Lord Foster's firm, said potential foreign investors in an estuary airport saw it as a "phenomenal opportunity", but added that they had also told him: "The government's useless; come back and talk to us again when you know that politicians are capable of making a decision."
Ministers should allow planning permission for both a third and fourth runway at Heathrow, according to an influential group of Conservative MPs who suggest this is the only way to preserve London's position as a world business hub, Helen Warrell reports.
The proposal is to be unveiled on Monday in a report by the Free Enterprise Group, a modernising collective of 39 MPs including Sajid Javid, an aide to chancellor George Osborne, and Matthew Hancock, Mr Osborne's former chief of staff. While the coalition agreement expressly rules out a third runway at Heathrow, Downing Street has recently indicated that it may be reconsidering the idea and could pursue it as a 2015 election campaign issue separately from the Liberal Democrats, who are vehemently opposed to expanding the west London airport.
Tory backbenchers Elizabeth Truss and Kwasi Kwarteng, who are among the authors of the Free Enterprise Group paper, argue that there is already private funding, industry support and existing infrastructure for developing Heathrow, but that the government should consider a more ambitious plan.
"Britain needs in the order of at least three new runways to accommodate demand," the report reads. "Concentrating these runways in the same location allows the facility to enjoy the benefits of a hub airport."
Another proposal put forward as part of the group's seven solutions to boosting UK growth is the development of a "Ministry of Infrastructure", responsible for identifying strategic infrastructure projects and arranging finance for them.
AIR TRAFFIC CHIEF'S FEAR OVER 'BORIS ISLAND'
A new four-runway airport in the Thames Estuary could create "insurmountable" problems above London, the head of
Britain's air traffic service has warned
Andrew Cave and Nathalie Thomas - Daily Telegraph - 7 July 2012
In a fresh blow to Britain's aviation policy, Richard Deakin, the chief executive of the National Air Traffic Service, raised serious concerns that a new Estuary hub would be unworkable, warning it could not co-exist with either Heathrow, London City, Northolt or Southend airports.
Mr Deakin, Britain's top-ranking aviation official, also reveals that the Mayor of London has so far failed to consult him over a "Boris Island", which could cost £70bn. A four-runway Estuary airport would only work "in isolation", Mr Deakin believes. It would not only interfere with London's current network of airports but also would also cause problems for Dutch air traffic and Schiphol airport.
"You may find that, in isolation, the airport works well but that actually the challenges of integrating it into the surrounding network of Southend, London City, Northolt and Heathrow are insurmountable," Mr Deakin said. "If you have four runways in the Thames Estuary, the approach and departure pattern would be right over the middle of London, where you have also got London City, Northolt, Heathrow and Dutch airspace traffic coming in from the east."
The aviation expert cautions that a "Boris Island" would have particularly grave consequences for Heathrow. Although he stops short of saying Heathrow would be forced to close, Mr Deakin says capacity at the hub, owned by BAA, would have to be cut dramatically. "That would be a difficult conversation for the airlines based there," he said.
"Hands up, who wants to reduce capacity at Heathrow? There's a huge amount of investment going in there at the moment with new terminals. It's British Airways' hub. So it's a big question for BA chief executive Keith Williams."
Mr Deakin's stark intervention in the aviation debate comes amid fears that the Government will seek to delay stating its position on the airport debate by making a "call for evidence" which does promote any options.
The Government is due to publish the call for evidence alongside its long-awaited Aviation Policy Framework by the end of the summer. Sources say the policy framework is unlikely to tackle sensitive issues around aviation capacity and will instead focus on broader areas such as carbon emissions.
The Government has firmly stated that it opposes a third runway at Heathrow, but BAA will be allowed to make its case for expansion as part of the call for evidence. "You can't prejudge what sort of evidence you receive," said one government insider.
Sources say Transport Secretary Justine Greening is hoping to reach cross-party consensus on aviation capacity to deflect some of the pressure on the Conservatives over Heathrow. Some in the industry fear that the Policy Framework may also be delayed until September.
MANCHESTER AIRPORTS TO BID FOR
STANSTED AIRPORT, TIMES SAYS
Makiko Kitamura - Bloomberg News - 8 July 2012
Manchester Airports Group is preparing to bid for Stansted Airport, the Sunday Times reported, without saying where it obtained the information.
Stansted Airport is expected to be put up for sale by its owner BAA Airports Ltd. later this year, the newspaper said. A successful bid by Manchester is necessary to close a deal with Industry Funds Management Pty., which may buy a stake in Manchester, the Times said.
AMS RALLY AGAINST HEATHROW RUNWAY
AS BUSINESS EXPRESSES CONCERNS
Londonlovesbusiness - 11 July 2012
London Assembly members have railed against a third runway at Heathrow as business groups expressed dismay the aviation consultation looks to have been delayed.
Members of the assembly have called on mayor of London Boris Johnson to join them in lobbying London's members of Parliament to shun a new runway at the airport. The government had been expected to announce a policy framework document on air capacity in the South East in March, but this was delayed until 2012. It now appears that the draft document and a consultation on airport capacity has been put back beyond Parliament's summer recess.
Liberal Democrat Caroline Pidgeon AM said: "In 2010 the Government was right to axe plans for a third Heathrow runway and the same arguments against expansion still hold good today. Having lifted the spectre of yet more noise, congestion and air pollution from the residents of West London it would be a gross betrayal to revive the proposals."
The assembly's motion was also supported by Conservative Gareth Bacon AM, who said: "It is not enough for London's politicians to say no to Heathrow expansion, we also have to work constructively with central government to find a solution to the international transport issues facing the capital.
If London is to remain the vibrant world city it is today it is essential that we have high quality transport links not just to our traditional trading partners but also to the emerging economic powerhouses of the future."
But while assembly members rallied against a new runway at Heathrow, business leaders expressed concerns that no progress in solving the South East's air capacity problems had been made. British Chambers of Commerce director of policy Adam Marshall said businesses were "tired of indecision and equivocation" on aviation policy.
Marshall said: "Ministers can't tell businesses to look for new opportunities in emerging markets like Brazil and China, and then fail to provide the basic infrastructure needed to get there." He continued: "The consequences of inaction are stark. If the government does not act swiftly to increase capacity in the South East, strengthen our regional airports, and support the development of more connections to emerging markets, the UK will lose both investment and jobs."
Marshall said aviation strategy should not be used as a "political football" and added: "New runways, at Heathrow and elsewhere, will be required to safeguard the UK's status as a global aviation hub in both the short and long-term."
ANGRY RESIDENTS PROTEST AGAINST AIRPORT PLANS
Dunstable Today - 7 July 2012
SCORES of angry residents from across Hertfordshire and south Luton packed out a village hall this morning in protest against plans to expand Luton Airport, writes Steve Nolan.
Long suffering residents of Breachwood Green were joined bright and early this morning by homeowners from Redbourne, Stevenage and Flamstead at the meeting organised by action group Herts Against Luton Expansion (HALE).
The hour long meeting, which was ironically interrupted several times by the noise of planes roaring overhead, saw protesters express concerns that a proposed expansion of the nearby airport could see aircraft passing over the Hertfordshire countryside every 90 seconds destroying residents' quality of life.
Andrew Lambourne, co-founder of HALE, said: "Airport noise has become worse and worse every year and it's got to the point where people are now saying they can't actually sit outside and enjoy themselves in the summer, you can't sit out and enjoy a BBQ for example. The planes have definitely got louder and louder over the past years and it's been a creeping increase and I think now they're at the point where people really have had enough.
It's going to get substantially worse if they go and increase passengers by 50 per cent, that is a substantial change."
"The other thing is of course that people who can't sleep very well do get woken up at night and the early morning rush hour is really unbearable and then you come home in the evening and you just want to relax and there they are again, they're all coming in until midnight."
"We've had two consultations, suggestions of around 18 million from the owners and 16 million from the operators, then there was a 'vision document' but we don't yet know exactly what we're talking about here and the key things like number of night flights, what will happen at peak hours, what exactly they're talking about in terms of larger planes, how they're going to cope with the impact on the M1 and on the rail services, we just have no idea."
HALE had invited airport representatives and Luton Borough Councillor Robin Harris, who attended last night's Love Luton Festival to see boyband The Wanted, along to the meeting to address residents, but none of the parties involved could make it."
When asked about the 'no-show' from council and airport representatives, Mr Lambourne added: "I think it's disgraceful because clearly it isn't just a matter of economics, it isn't just a matter of commercial gain, it's a matter of fitting in with the local community and if they say they're going to consult then they need to listen - consulting is a two way process."
GOVERNMENT SCRAPS NATS SALE PLANS
UKPA - 11 July 2012
Transport Secretary Justine Greening said it was best for taxpayers if the Government retained its shareholding in air traffic control company Nats
The Government has scrapped plans to sell its 49% stake in air traffic control company Nats.
Transport Secretary Justine Greening said it was best for taxpayers, travellers and Nats if the Government retained its shareholding. The decision was welcomed by the Prospect union, which represents more than 3,000 air traffic controllers. But Prospect said "all eyes would now turn" on the Airline Group - a body of seven airlines including British Airways and Virgin Atlantic - which owns 42% of Nats.
There has been interest in Nats from Germany's state-controlled air traffic control body, Deutsche Flugsicherung, which could also be keen to buy the Airline Group's stake.
Ms Greening said the response to a call for evidence about the Government's Nats' shareholding had "highlighted the strategic importance of Nats to the UK and the far-reaching implications of a sale at this time". She said these included the continued development of the Single European Sky agenda - an EC initiative by which the design, management and regulation of airspace will be coordinated throughout Europe.
Ms Greening said she had also considered the ongoing work on the Single European Sky Air Traffic Management Research programme. "After considering these factors, I have concluded that it is in the best interests of the British taxpayer, the travelling public and the company itself to retain the Government's shares in Nats at this time."
Prospect national secretary Garry Graham said: "The Government has clearly listened to the representations made by stakeholders for safety and service delivery to remain paramount, and for the UK to continue to have an authoritative voice in Europe, particularly during the development of the Single European Sky initiative."
He went on: "All eyes will now turn to the Airline Group - and their intentions. The need for stability and a commitment to safety and service delivery should be at the heart of any decision that they make. They purchased their stake because they had a vested and visceral interest in safety and service delivery. We are concerned that their position is now focused on short-term commercial gain."
GOVERNMENT U-TURN ON HEATHROW EXPANSION
Jim Pickard and Andrew Parker - Financial Times - 1 July 2012
Four years ago David Cameron, as leader of the opposition, lambasted the Labour government for "pigheadedly pursuing a third runway" at Heathrow.
Now, as prime minister, he has quietly swung his support behind the expansion of the west London airport, convinced by business leaders that it is the most practical way to expand aviation capacity in the south-east.
But do not expect senior ministers to sing about this from the roof tops: an aviation policy paper being finalised by the transport department will suggest that expanding Heathrow - which is approaching full capacity - is far from desirable. Instead it will emphasise other options for solving the UK's hub capacity crunch, such as a new airport in the Thames estuary or the contentious "Heathwick" scheme, connecting Gatwick and Heathrow by high-speed rail.
The apparent confusion stems from two factors. First, the Tories promised in their manifesto that they would not expand Heathrow, a key plank of their commitment to the green agenda. Second, they are still locked in coalition with the Liberal Democrats, who took the same stance in 2010 and still consider it an impassable red line. As a result, the prime minister and chancellor will only be able to execute their Heathrow U-turn after 2015 - and, only then, if the Tories win an outright majority in the general election.
This summer's "call for evidence" on how to maintain Britain's role as a leading aviation hub was originally scheduled for March by the transport department but is already three months late. Crucially, the official response to this - a final policy paper on hub airport capacity which was earmarked for March 2013 - is now set to be delayed for several years, effectively postponing any firm decision until after the general election.
The next three years will therefore feature efforts by the coalition to prove it can improve Britain's hub airport capacity, while making no big-ticket decisions. Instead the focus will be on small-scale attempts to enhance capacity at existing airports. One option would be to encourage more large aircraft to land at Heathrow. Others, such as more night flights, are opposed by the Lib Dems.
Justine Greening, transport secretary, is a vehement opponent of Heathrow expansion, having campaigned against the project for years. Her suburban Thames-side constituency of Putney lies directly under the flight path. Ms Greening would be moved to a different job if the Tories win a second term without the Lib Dems, to avoid forcing her to preside over an excruciating U-turn.
The sense that Ms Greening is not firmly at the wheel of transport policy was exacerbated this week when a freeze in fuel duty was announced just hours after she had argued against it. For now, the transport secretary is determined to publish the initial call for evidence imminently to end speculation about Heathrow's third runway. She is fighting some cabinet colleagues who have argued that this non-committal publication should be dropped altogether.
Yet, behind the scenes, the Tories have executed a U-turn. As recently as last November, Mr Osborne said that the government would look at all options for preserving the UK's status as a leading aviation hub "with the exception of a third runway at Heathrow". But there are serious obstacles to all the alternatives for new south-east hubs, not least their enormous cost.
Previous attempts to get a third runway built at Heathrow ran into enormous opposition from local residents and environmentalists concerned about noise and carbon dioxide emissions.
Last week, leading figures in UK aviation - including Willie Walsh, chief executive of International Airlines Group, parent of British Airways, and Colin Matthews, chief executive of BAA, Heathrow's owner - called on ministers to consider all options for solving the hub capacity crunch, including Heathrow's expansion. Some of these figures may be disappointed if ministers appear to be kicking final decisions on increasing hub airport capacity into the long grass.
Mr Walsh, referring to the transport department's forthcoming policy papers, said last week: "We've had years of government inactivity on aviation policy and this consultation must result in a plan of action and the commitment to see it through - not another fudge."
Other business leaders may welcome the indication that the Tories are now set on expanding Heathrow - although only if they defy the opinion polls and increase their share of the vote in 2015. A spokesman for the transport department said its business plan still included a target of March 2013 to adopt its new aviation framework.
COALITION PUTS HEATHROW DECISION ON ICE
The coalition is planning to delay a decision on whether to build
new runways in the south-east amid deep splits between the Tories
and Liberal Democrats over the expansion of Heathrow
Jim Pickard, George Parker and Andrew Parker - Financial Times - 1 July 2012
The Conservative leadership has decided to make a decisive switch away from the party's outright hostility to a third runway at the west London airport by making no mention of Heathrow in its general election manifesto, according to senior party sources. That would clear the path for a majority Tory government to proceed with the project after 2015.
Meanwhile the transport department is still planning to bring out two aviation papers this summer - one will be a "call for evidence" about how to preserve the UK as a leading aviation hub. This paper will give a strong steer that the government is not committed to a third runway at Heathrow, although it will include it as an option. It will outline other alternatives such as expanding Stansted or Gatwick, building a giant Thames estuary airport or connecting Heathrow and Gatwick with a high-speed rail line.
Under the original plan the paper should have been published three months ago, with the government formally adopting its preferred options in March 2013. But the Treasury and Downing Street are pushing for the paper to include a long "lead time" of several years, supposedly to allow aviation companies enough time to work up properly costed responses.
In reality the delay means ministers may not have to make a firm commitment to any new hub capacity before the election, avoiding a showdown between the Tories and the Lib Dems, who oppose any major expansion of airports in the south-east.
At the same time, a debate is taking place over how to squeeze more capacity out of Heathrow in the short term, with the Lib Dems arguing against Tory plans for more night flights and "mixed-mode" whereby planes land and take off from the same runways. The Lib Dems want to find other ways to increase capacity at Heathrow in the next few years without resorting to either unpopular measure. David Cameron and George Osborne previously showed a keen interest in a new estuary airport but enthusiasm has waned given the scheme's £50bn cost.
A three-year delay on final decisions about UK aviation policy could infuriate some in the industry, who accuse ministers of being slow to resolve the UK's hub airport capacity crunch. BAA argues it is struggling to support new aviation links to emerging markets because the airport is operating at near full capacity. A report commissioned by BAA in September said that the UK risked missing out on trade worth £14bn with developing countries during the next decade because Heathrow cannot expand.
Other business leaders may welcome the indication that the Tories are now set on expanding Heathrow, although only if they defy the current opinion polls to increase their share of the vote in 2015. But environmentalists, who have adamantly opposed the Heathrow expansion, are increasingly alarmed by the Tories' shift towards a pro-third-runway position.
OUR COMMENT: There are U turns and UU turns, it seems! Which will it be?
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