Written evidence submitted by the UK Regional and
Business Airports (RABA) Group (AAS0046)
[1]

 

 

The Group’s overarching aim is to ensure the strategic importance of the UK’s smaller and business airports and the economic value they create at a local, regional and national level is understood and recognised by Government, regulators, local authorities, shareholders, investors and other key stakeholders with a view to positively influencing the commercial, regulatory and reputational environment within which its members operate.

 

The Scope of our Submission

The UK Regional and Business Airports (RABA) Group is going to restrict its comments to the following areas of interest (in red) the Committee has highlighted.   We are not focussing on international travel and border readiness, as we have less exposure to this aspect, and hence our comments would be less authoritative.  There are other gaps in our submission which may also be down to a lack of relevant data or resource to investigate further.

 

Recovery of the UK aviation sector

The traffic light system for international travel

The cost of international travel

Border readiness

Regional and global connectivity

Sustainability

A summary of our Recommendations to the Committee are set out in Appendix 6

 

Recovery of the UK Aviation Sector

The short-term and long-term effects of the coronavirus pandemic on the UK aviation industry

 

Impacts on Different Types of Airports

 

The impact of CoVid 19 on airports and air travel can hardly be overstated.  Even largely before the UK lockdown in late March 2020, numbers had already tumbled as concerned travellers stopped flying.  After lockdown, as evidenced by the June data in the Chart below, they tumbled even further, despite the usual seasonal uptick in numbers (see March vs June 2020), although at much lower volumes.

 

 

The data[2] non-London Airports appeared to have experienced an even more drastic collapse than the London Airports.

 

 

In terms of numbers of domestic and international destinations served by scheduled services the picture is the same.

 

 

Some more current data we have to hand on the range of impacts and responses occurring at some of our regional airports.  We compared the summer three months of June, July and August of 2019; 2020 (when there was partial relaxation and summer 2021 just passed).

Inter-regional Comparisons

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When we look across the country over the last two years, the scale of impact of COVID is material, but can vary widely. For example, at one extreme is Cardiff (CWL) where commercial traffic all but disappeared, whilst at the other is MME (Teesside) which has actually grown relative to 2019 because it has aggressively been pursuing policies to bolster its airport and achieved a link with London Heathrow. If we take some of the individuality out of it and look at things regionally a pattern of a very poor bounce back (3-6%) in 2020 with a stronger bounce-back in 2021 (22-34%)

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In essence we can see that a recovery is occurring, but we are still around 75% lower than 2019.  So, while the recovery touched 60% of 2019 traffic levels at some larger airports, especially where low cost carriers like Wizz, easyJet and Ryanair and outbound leisure travel pre-dominate, elsewhere it was much more subdued at closer to 40%. These figures are lower than in comparable EU countries and far more so than in the US where traffic peaked at 90% of 2019 levels.

Of additional concern is evidence of the withering of regional connectivity as a result of the pandemic with no clear path for a restitution of previous levels.

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Impacts on Airport Businesses

 

If we look in more detail at ‘airport specific’ impacts, a few clear themes can be highlighted.

 

Airline Bases and Headquarters

Airports hosting airlines - based or headquartered – have as expected suffered greater job losses and furloughing than other airports.  The loss of Flybe’s HQ from Exeter was a significant regional blow, as were its bases at Southampton, Birmingham, and Manchester, but Easyjet’s bases in Luton and Gatwick and BA’s at Heathrow and Gatwick – although secure – have experienced a significant downsizing of crew and cabin crew during the pandemic.  In some cases, a combination of the loss of Flybe and COVID have seen airlines withdraw from airports to such an extent that they are left with few if any flights - a major blow financially to the airport and economically to its supporting catchment (e.g. Southend has lost easyJet, Ryanair and Stobart Air; Cardiff  - Flybe; and Belfast City - Flybe and then Stobart Air in the form of Aer Lingus Regional).

 

Ground Handling Companies

These important airports also have ancillary suppliers such as inflight caterers and ground handlers who will have downsizing both their employment and their rental space during the pandemic.

 

Airports - Loss of Tenants

Rental losses and S44 claims are likely to be significant as airports, their tenants and businesses connected with scheduled aviation contract in size, relocate or fail.  This loss of income will badly affect airport finances but also local authority business rates income. The total rates bill for commercial airports in England in 2019 was c£215m; while the AGOSS scheme provided some help with these costs, it was capped for those that were eligible and many weren’t.

 

Airports Loss of Car Parking and Retail Income

 

Airports do not rely solely on aircraft and passenger charges and enjoy significant revenue from airport parking and terminal retail activity.  Both of these income streams will have almost entirely dried up during the depths of the lockdown and are likely to only recover as passengers return. While some larger airports are expecting a full recovery to 2019 traffic levels by 2022 or 2023, smaller airports are concerned it may take them longer (i.e. to 2023 -2025) as some of their 2019 routes will be amongst some of the most marginal pre-COVID and therefore represent markets where the markets will take longest to recover.

 

Airports with Aerospace Clusters

 

Airport catchments with important aerospace clusters have also been sharing the COVID ‘pain’ as a result of the contraction of civilian aircraft orders and MRO activity connected with reduced fleet sizes. These are based in the South West and Wales (Airbus, GEC, Rolls Royce, GKN, Messier Doughty, BAMCE, Skybus), the West of Scotland (Rolls Royce, United Technologies, BAE Systems, Loganair) the East Midlands (DHL, UPS), and the South East (easyJet at Luton, Gulfstream at Farnborough, Eurocopter at Oxford, and Bombardier at Biggin Hill).

 

Airports with Diversified Income Streams

 

Airports that have a more diversified income streams are likely to have been less adversely affected than airports that rely almost solely on civilian passenger aviation, which is where the impact of COVID has been most felt. Dedicated Business Aviation airports have proved to be more resilient to COVID pressures than scheduled aviation and indeed may even enjoy stronger future growth as scheduled aviation remains less attractive to consumers than heretofore.

 

East Midlands Airport, although suffering from a scheduled aviation collapse, has seen its Express air freight operations not only hold up remarkably well, but actually expand during COVID. Indeed, the air cargo sector as a whole (i.e. including Royal Mail/ Parcelforce) have been very robust, with Heathrow being only 20% down on pre-COVID tonnages because of freighters replacing the bellyhold capacity normally available in passenger aircraft. The e-commerce revolution means the freight boom is expected to continue for 5-10 years.

 

Case Study: Caithness & N. Sutherland and Wick Airport Loses Air Services

 

Caithness and Sutherland is the most peripheral part of mainland UK.  It has significant geographical challenges impacting its ability integrate into both Scottish and UK national life.   Since Covid the air services between Wick John O’Groats Airport (WJOG) and Aberdeen and Edinburgh have been suspended with little prospect of adequate frequency being delivered by the open market, or in the foreseeable future. Many local stakeholders have significant concerns about their loss of air service provision.

 

Where, as here, market failure demonstrably exists, EU PSO regulations allow for public sector intervention to address the connectivity shortcomings required to meet growth needs of the airport catchment area. In this case Highland Council has decided to explore the potential for instituting Public Service Obligations on the two routes as this seems to be the only way of re-constituting good travel connections with complementary metropolitan centres (i.e. the Scottish national capital of Edinburgh and its energy capital at Aberdeen), as alternative public transport links by coach or train, even just to Inverness, are infrequent, lengthy (between 4.5-5.5 hours) and unreliable. Moreover, car drivers travelling to Edinburgh have to allow around 6 hours and 5 hours to Aberdeen.  Public transport times to both centres are significantly longer, whereas an air service would make the journey in under an hour.

 

The small local population (and hence constrained market), and the nature of the area’s economic assets mean that key economic sectors and employers are outward facing. That includes major inward investors such as Rolls Royce.  They rely on good transport links and air services in particular - to maximise the benefits of the local economy’s assets, despite its remote location. New economic initiatives such as renewable energy, the North Coast 500 tourism route, and the Sutherland spaceport are all also dependent to a greater or lesser degree on air access.

 

Part of Highland Council’s current task (in addition to initiation the PSO tender process) is to secure pledges toward the costs of operating the two PSOs routes. Transport Scotland have publicly pledged £1m/year towards what may be a +£2m requirement (especially during the Covid Recovery period), but there is a danger that other potential contributors, including Whitehall departments such as DfT and the Office of the Secretary of State for Scotland, could undermine these efforts by failing to offer their own support.

 

Recommendation on WJOG: The Committee’s support for ensuring the requisite funds for providing these two essential links serving what is probably the most remote parts of the UK mainland, during the current tendering process, could play a hugely valuable role in securing these important links.

 

The Effect the End of the Furlough Scheme May Have on the Aviation Sector

RABA Group do not have the data to hand to comment on this in any detail, other than to say that it is likely to result in staff who were on furlough over the last 18 months being made unemployed over this winter, as traffic has not yet recovered sufficiently at RABA airports (i.e. those with less than 3mppa) to enable them to restore a full pre-COVID complement of staff. The numbers of redundancies at each individual UK smaller airport may not appear significant in the context of losses at Heathrow, Gatwick and MAG airports, but:

Cumulatively the numbers are significant – we estimate 40-60% depending on the airport and its type of traffic – equating to 8,700-13,000 direct jobs, 14,700-22,000 if indirect and induced job losses are included and perhaps as much as 30,000-45,000 taking into account catalytic effects.

Even more importantly, the vast majority are in the UK regions and many of them in remote, peripheral or rural economies where the effect will be much more keenly felt than in much larger urban labour markets where the scope for absorbing such job losses will be far greater.

And perhaps crucially, the evidence points to the small recovery that may have taken place over the summer months being largely outbound leisure and low-cost carrier driven, when the critical markets for smaller airports are business, VFR, domestic and regional carrier based. This means we anticipate, without Government support, the recovery taking much longer to bed down at RABA’s member airports, with full recovery unlikely at some of them until 2025.

The other major concern about post-Furlough redundancies is the loss of skilled and well-trained employees on which the sector depends, but currently cannot afford without Government support.  As other sections of the UK economy – from GP’s to HGV drivers and care workers – have found, replacing these lost employees, will not be easy to achieve quickly. The more skilled the employee the greater their transferability to other sectors and with such competition, the more the likelihood that competition for resources will increase wage inflation.

The government’s Aviation Skills Retention Platform (ASRP) was a helpful initiative and may come into its own once the recovery of the aviation sector is firmly underway – which we consider unlikely this winter, with RABA members hopes resting now on Summer 2022. However, ASRP does nothing to help restore or create jobs in the sector, and there has not been enough innovative thinking or Government support for areas like aircraft recycling, are cargo, greening of airports and new technologies, all of which offer major opportunities for significant volumes of high skilled jobs. And crucially, if UK companies can be helped to grab market share in these growing parts of the industry, it will in turn continue to pay back such investment in both direct, indirect and induced impacts on UK supply chains and local economies that are dependent upon it (as discussed later in this document)

The Aviation Sector’s Potential to Contribute to the UK’s Economic Recovery after the Coronavirus Pandemic.

 

The starting point for understanding what RABA airports have the potential to contribute to the UK’s post-COVID economic recovery, is to examine what they contributed before the pandemic began.

 

In a 25-airport sample of its members undertaken in 2015, RABA found that there were over 2,000 FTEs in direct employment and with a further over 5,000 indirect FTE employees, making an estimated GVA contribution to the UK in the order of £735million. Since then our membership has grown from 25 to 42, and our best estimate, making an allowance for smaller airports that are not yet members, is that they are now responsible for over 3,000 direct airport jobs, in excess 8,000 indirect jobs and GVA of £1.2bn. Including induced and catalytic effects could increase these figures overall by a 150% or more.

 

With this in mind, it is worth noting that two thirds of the reporting airports also had associated business parks or commercial development attracting many thousands of employees associated with the supply chain of the airport or its users (i.e. airlines, freight companies, maintenance operations) or from other sectors attracted by the catalytic benefits of its proximity and associated connectivity. Indeed, local economic development plans frequently recognise these airport-associated employment clusters as being of value to the local economy. This value has also been recognised in many academic papers [3][4] and individual airport economic impact studies.

 

As highlighted above, airports serving < 3mppa, which are the core of RABA’s membership, and at a collective 22mppa in 2019 represent an important share of traffic using UK regional airports (18% of regional passengers and significant proportion of UK airports, aircraft traffic (40%) and air transport (23%) movements. As providers of niche passengers air services for many parts of the UK, they are important as gateways to remote and peripheral areas and in connecting secondary and tertiary UK cities to London and near Europe.

 

Airports also host other vital aspects of UK aviation such as flight training, specialist and business aviation, special mission’s aviation (reconnaissance, SAR, defence, surveillance, fire-fighting/disaster response/relief management, aero-medical, social, political, VIP etc.) These airports and adjacent businesses are significant employers in their own right and their GVA contribution to the UK economy is significant; perhaps even more important they also impact significantly on regional development

 

Further potential exists to nurture associated aerospace employment clusters and turbo-charge the secondary and tertiary regions that they frequently serve.

Consequently, Regional Airports (RABA Members) and their close association with many special assisted areas offers a convenient, effective and comprehensive lever to apply across economically challenged UK areas.

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Description automatically generated‘Development Regions’ allow greater scope for public intervention even in aviation. (e.g. PSO, SGEI status, RDF, Sir Discount Scheme; Tax Exemptions)

Levelling Up

 

This review should remain alive to the issue that boosting the transport options connecting the UK sits squarely at the centre of the government’s levelling up agenda. In relation to this we highlight that many of our airports are frequently in close association with the UK Special Assisted Areas (Shaded).  For those concerned about re-balancing the UK economy, many of these airport nodes offer convenient ‘ways into’ these development regions.

 

Aviation and Economic Vitality

Evaluations of airport’s economic impacts typically have tended to be locally/regionally focused and deal with direct, indirect and induced impacts (e.g. jobs, GVA and tourism spend)

Growing proposition that aviation connectivity contributes to the growth not just of local economies in the immediate vicinity of an airport, but also more broadly to regional and national economies through a range of catalytic impacts). Reallocation of resources to more productive uses facilitating increased international trade in goods, services and tourism:

 

-       By increasing capital intensity  

-       By encouraging innovation

-       By shifting more resources into export sectors

 

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Oxera identified that the main benefits of connectivity were transport user benefits, better place competitiveness and wider economic benefits. The latter include agglomeration benefits, labour market effects, and imperfect competition effects.

Oxford Economic Forecasting – consider a good air transport network facilitates economic growth by improving efficiency, boosting investments and leads to more innovation.

InterVISTAS for IATA provides a more wide-ranging international perspective, points to a 10% growth in connectivity boosting labour productivity levels by 0.07%.

Other studies acknowledge that better connectivity leads to higher productivity in a region or country. Higher productivity can lead to higher GDP - the catalytic impact on investment and productivity of the expansion of air services over the past decade has contributed an additional 4% to European GDP.

 

The Causality Conundrum

This is important and can be explained as follows: Economic growth leads to more demand for air transport, but the direction of causal relationships between regional air transport and economic growth can be classified into three types, each of which has important implications for airport/aviation policy:

-       Unidirectional causality running from air traffic to economic development.

-       Unidirectional causality running from economic development to air traffic.

-       Bi-directional causal relationship.

In this a study by Ghent University, less developed peripheral economies responded significantly and speedily to increases in connectivity – note the north of Scotland; north of Sweden; north of Spain and south of Ireland.

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Prof. Dr. Ben Derudder - Globalization and World Cities research network Study

Using employment as a proxy for economic development

Regression Analysis of Direct Employment at UK Regional Airports (2012-13 data) indicates the strong relationship between passenger numbers and airport’s direct employment

 

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Other economic derivative impacts that can be expected revolve around:

 

 

Strategic Importance of Regional Airports

  1. Our group members are typically airports serving the UK’s secondary or tertiary cities or more remote and peripheral regions.  Indeed as brown field sites they often are also host to significant aviation, and even non-aviation, related employment clusters.  Their connectivity (air and surface) is often seen as a USP for inward business investment
  2. More policy recognition is being accorded to the importance of secondary and tertiary cities and their regions in efforts such as the City Deals programme and the Scottish Cities Alliance.   Smaller regional airports invariably are an important aspect of keeping these cities and the regions and sub-regions they support effectively connected to the world economy.
  3. It must also not be forgotten that regional airports play host to a wide range of specialist roles such as fire, pilot and aeronautical training; aircraft maintenance, testing and teardown; dedicated freight (parts, perishables), aid or mail operations: national security and emergency services, ad hoc military use, offshore support, business aviation and more recently UAV’s as well as ‘events’ such as air shows and more routine GA, that cannot be accomplished at more congested airports.

Recommendations for the Levelling-up Agenda

Aviation can contribute significantly to the Levelling-up Agenda and Policy; measures to facilitate this process would include: 

-       Recognise that airports and air routes are essential national infrastructure which must be supported and made more resilient to existential shocks like pandemics, including, where appropriate, by allowing public ownership of assets (although not necessarily of operations).

-       Public ownership/shareholdings in airports/airfields should be supported by the Government, but on the basis of local connectivity and economic considerations (Teesside and Newquay in Cornwall are good examples of this), not solely national ones, and could take the form of loans or equity, with local or regional authorities enabled to take financial stakes to ensure infrastructure of significance to their area is protected. 

-       Non-core military airfields (i.e. excluding designated front-line bases) should be developed for joint military/commercial or GA use in areas where there are significant gaps in civil airfield provision.

-       Greater use of smaller regional airports should be encouraged for a range of purposes: These include: military flying (allowing non-core bases to be released for GA or re-development), Freeport's, employment clusters and renewable energy centres (including power generation and biofuel production), aerospace manufacturing /servicing/testing and hence diversifying income generation, reducing dependency on passenger volumes and contributing to long term sustainability.

-       The issue of the disproportionate cost burden of regulation on small regional airports must be addressed either at source or via an appropriate compensatory mechanism.

The latter proposal is examined in more detail in the section below.

 

The potential merits of Government (a) financial, (b) regulatory and (c) other support to the aviation sector;

 

Disproportionate Regulatory Regime

There are a range of aspects of high fixed costs connected with airports with smaller passenger throughput, that disproportionately disadvantage them and constrain their ability to grow and serve their local catchments economically and in terms of connectivity.

 

  1. Reviewing cost/risk balance within certain operational safety measures should be reviewed (e.g. RFFS and air traffic control): Risk-based approaches adopted for smaller airports that will allow costs to be managed downwards from current one size fits all standards.
  2. CAA Terms of Reference: These could quite easily be extended to promote enhanced regional air connectivity and assist in making smaller airports more commercially sustainable.
  3. Support for the cost of nationally imposed obligations: Compensating Airports for the system-wide and network benefits associated with common security, immigration and customs regulations they pay for, particularly smaller airports where they impose a disproportionate cost on the smaller number of passengers which pass through those airports.

 

More Flexible and Supportive Policy Framework

  1. Introduce a presumption in favour of airports being allowed to develop their estate and roll out a package of incentives to encourage the creation of employment clusters and diversify their income streams so they can become less exposed to the vagaries of the aviation cycle on income.  The Newquay Aerohub Enterprise Zone is held up as an example that could be replicated and encouraged across the country. 
  2. The prospective Aviation Framework needs to address issues related to small airports in a positive manner…… because airports are on the outskirts of towns or cities, planners often regard them as unsustainable locations and seek to tightly define the aviation related uses that can locate at them reducing their ability to generate a critical mass of clustered business activity.  The NPS should encourage the potential of smaller regional airports as generators of economic activity, which will complement their role in providing regional connectivity and will also improve the viability of public transport, which itself will enhance sustainability.

A comprehensive approach would include the following:

Land use planning and airspace approval processes for new airport or airport related developments and airspace changes to be simplified and speeded up - more DCOs for large developments, roll out of Local Area Airport Plans to speed up small applications - conformity equals approval in principle subject to conditioned details.

Regional authorities to draw up aviation strategies based on national policy, local authorities to reflect both of these in Airport Local Area Plans (to include local ATM change proposals based on the national ATM modernisation strategy); Airport masterplans to be in conformity with the foregoing.

Airports should be recognised as part of the national transport infrastructure and should be treated as such by Highways England, Network Rail, Devolved Administrations and Local Authorities when considering investment in network maintenance and improvements. 

Airports should pay for surface access improvement schemes within their land holdings but should only contribute to strategic schemes that benefit them to the extent they benefit.

A national scheme equivalent to the Housing Infrastructure Fund should be established to offer central contributions towards surface access serving key transport gateways (i.e. airports, ports, High Speed and City centre railway stations).

More specifically proposed support measures for smaller regional airports:

 

 

 

 

 

 

Coronavirus: NI Domestic Aviation Kickstart Scheme

As an example of the kind of pro-active initiative that can delivers real benefits as the regional aviation sector recovers, the RABA Group would like to draw the Committee’s attention to the Northern Ireland Domestic Aviation Air Discount Scheme which was launched in the early summer to protect and enhance air services to the rest of the UK.

24 June 2021

News article

Financial support scheme for airlines as they rebuild from COVID-19 and to maintain and enhance Northern Ireland's air connectivity with Great Britain

The Department for the Economy (DfE) has developed the NI Domestic Aviation Kickstart Scheme (NIDAKS) to support airlines as they rebuild from COVID-19. The scheme will also help kickstart NI’s economic recovery by maintaining and enhancing NI’s domestic air connectivity with Great Britain (GB).

Aims of the scheme

The key objectives of the scheme are to support inbound tourism and business travel (both from and to GB) and to encourage inward investment into the Northern Ireland economy.

The scheme has the following complementary aims:

Support basic route frequency to be maintained throughout the scheme period.

To incentivise enhancements of frequency above the basic route frequency.

To support initiatives to develop new routes.

 

To be able to apply to the scheme a passenger airline operator must have a licence to operate UK domestic air routes.

The scheme is administered by Invest NI on behalf of DfE.

https://www.nibusinessinfo.co.uk/content/coronavirus-ni-domestic-aviation-kickstart-scheme

The Committee might like to familiarise themselves with the efforts that the NI Government has been making to protect NI’s current and future connectivity and consider whether there is a need for a similar targeted intervention to benefit UK regions’ domestic and international connectivity.

Business and Special Missions Aviation

 

There’s almost certainly an ‘understanding deficit’: Business Aviation (BA) is rarely discussed within Parliament. The perceptions that it is all wealthy leisure travellers has to be debunked – the value to business needs to be emphasised and we need examples of ‘ordinary, middle managers’ who use the services and so on.

 

The bigger airlines and airports already have well-established links with policy-makers and there is far better understanding of commercial aviation. This is what we have to compete with.

 

BA was cited briefly in the Aviation Policy Framework, in a positive context “maintaining access to such a national network is vital to the continuing success of the sector.” However, BA is not necessarily being recognised as a critical component of improved connectivity (‘thick connectivity’ is well recognised but thin connectivity - carrying a low volume of passengers between a much larger number of destinations – less so), which is itself listed in the APF: ‘One of our main objectives is to ensure that the UK ‘s air links continue to make it one of the best connected countries in the world. This includes increasing our links to emerging markets so that the UK can compete successfully for economic growth opportunities’.  This is an opportunity as well as a threat.

 

As the scheduled airline traffic recovers after the economic downturn, business and commercial jets will need to work harder to complement each other.  Further information is provided in Appendix 5 and RABA Group is preparing a separate report on this sector for the Aviation 2050 Framework work being undertaken this side of Christmas.

Recommendation: The Committee should include a review and mention of Business and Special Missions Aviation in any of their outputs and recommendations.  RABA Group would happily facilitate more detailed investigations or site visits if required.

Regional and global connectivity

We hope that the Committee will recognise that domestic flying makes up a large part of the passenger traffic at smaller regional airports; these are the nodes in the UK’s strategic airport ecosystem that are financially the most vulnerable and serve the remotest/most peripheral areas with the least adequate alternative surface modes. As we discuss further below, domestic aviation is a priority issue for many of RABA’s members.

 

Re-establishing global connectivity to support the Government’s Global Britain agenda

 

That being said a substantial number of them also have:

 

Links to overseas hubs – particularly Dublin, Amsterdam, Paris and in some cases Frankfurt offering onward global connections to either complement those available from UK international Gateways like Heathrow, Manchester and Stansted, or in some cases act as a substitute because of slot shortages at Heathrow.

 

Scheduled or charter flights to sun destinations – although these are seasonal and offer only a limited range of destinations. It is known this is potentially a bouyant part of the aviation market now traffic restrictions are being lessened.

 

Business Aviation services offering a bespoke product that can use small airfields close to the ultimate destination than might be available by commercial air transport services.

 

RABA is keen to ensure these markets are restored as the industry recovers, and especially that slots are ring-fenced at the UK’s own hubs so that UK regions are not dependent upon EU airports for global access. But none of this will disguise the critical need to restore domestic services within the Common Travel Area (i.e. the UK, Ireland and Crown Dependencies).

 

Domestic Aviation within the CTA

 

For many small and medium sized regional airports, especially those:

 

       located ‘across water’ from the mainland (e.g. Northern Ireland, the Scottish Islands, the Iles of Scilly, and the Crown Dependencies);

       serving remote, peripheral and rural areas (e.g. Devon & Cornwall, the Highlands of Scotland, Cumbria, North and West Wales and East Anglia – Norwich, the Suffolk Coast, Lincolnshire, Carlisle and Anglesey are all for example 4 hrs or more drive time from Heathrow);

       where there are no rail services offering ‘cross-country’ connections between the UK’s core and key cities (e.g. Aberdeen, Inverness, Cardiff, Exeter, Plymouth, Newcastle, Teesside, Leeds-Bradford, Doncaster/Sheffield, Southampton/Bournemouth, Liverpool, Humberside, East Kent);

 

air services provide – or have the potential to provide - essential business, educational, social, cultural and family connectivity that rail/car simply cannot match in terms of travel times, cost or convenience.

 

Two-thirds of the UK’s domestic routes are of this nature and most of the remainder link London to the UK’s large regional cities (Edinburgh, Glasgow, Manchester, Birmingham, Bristol) providing essential competition to radial inter-city rail services (e.g. on the East and West Coast Main lines) where fares are recognised as having increased materially in recent years, but most especially where competing air services have been lost.

 

Close scrutiny will demonstrate, that outside the London & the South East and the larger Core Cities, typically 75-80% of the exports of UK regions are to other domestic markets or the RoI. This makes facilitating convenient access to customers and indeed domestic suppliers essential for regional business; equally they also need flights from their local airports to connect with Heathrow or other UK (Manchester, Edinburgh, Birmingham) international hubs/gateways for onward European and global connections. European hubs such as Dublin, Amsterdam, Paris and Frankfurt are useful in providing choice, but strategically should not be relied upon as an alternative to UK hubs, as only at the latter are slots and capacity a matter over which the UK Government has a measure of control or influence.

 

We are hoping, therefore, that the UCR will make a powerful statement about the value of domestic aviation to the UK, not least to counter the criticism which the Chancellor’s cut to Domestic APD has engendered.  RABA is entirely supportive of this structural initiative which corrected an anomaly created by the EU single market.

 

The above notwithstanding, we do think there are measures the Government could take to further support regional connectivity;

Recommendations

Establish the principle that no part of the UK should be more than 4 hours travel from the UK capital, or 3 hrs from a national hub airport to ensure there is equality of access to markets right across the UK.

Connectivity to national hubs and on long distance (3 hour plus) cross country inter-city routes should be facilitated, if necessarily with PSOs.  On thick routes it is important to maintain air/rail competition, otherwise prices escalate and should be regulated (as in France/Germany)

UK should not need to rely on other nations hubs for access to all global continents and the world's top 250 global cities. 

Each region of the UK (i.e. London and the South East, Midlands, North of England, South West & Wales, Scotland and Northern Ireland) should have both a belly hold freight hub and a dedicated freighter airport for air cargo.

Smaller airports that cater significantly for business aviation, aerospace/OEM manufacturing, MRO and associated aviation servicing, should be recognised as important infrastructure that should be protected and encouraged

The ATM system in the UK must be updated to deliver future operational and growth requirements; in doing so the CAA should be able to demonstrate in its decision-making on airspace changes that a balanced approach provide equal weight to industry and community concerns

Slots at national hub airports could be prioritised for regional connectivity for an initial transitional period.

 

Recognition that LHR (the UKs’ global hub) is important in this regard.

UK should move away from relying on other nation’s hubs for access to all global continents and the world's top 250 global cities. 

Sustainability

Aviation’s progress on reducing emissions to support the Government aim to achieve net zero greenhouse gas emissions by 2050

 

We note the Committees interest in rail and road projects and would like to make a few points in relation to our members and the connectivity they offer.

 

We contend that National Connectivity can be in large measure be achieved more cheaply and with less environmental impact by air – particularly between those far flung and less densely populated parts of the UK.

 

In particular, the RABA Group also wishes to draw the Committee’s attention to a range of insights that do run counter to some of the conventional wisdom and heat surrounding the topic of domestic aviation emissions.

 

Different Types of Aviation have Very Different Current and Prospective Carbon Footprints

 

In 2018, aviation comprised 7% of UK GHG emissions; this is a far smaller amount than is often referred to, which is usually what aviation is projected to be responsible for in 2050 (i.e. 25%) making no allowance for the introduction of new technologies and operational strategies that could decarbonise it materially over the next 30 years.  Indeed, recent DfT figures suggest that UK Aviation emissions have increased 18% since 2000 but have been more than offset by CO2 efficiency improvements averaging 2.2% per year.  And all the leading international aviation bodies (i.e. ICAO in the UN, IATA and ACI) have committed themselves to a 2050 Net Zero carbon target by 2050.

 

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DFT  Aviation Decarbonisation Briefing - March 2021

 

Our overriding point is that the industry’s prospective carbon footprint is therefore very often misrepresented in discussions about Climate Change policy.

 

So, for example, UK domestic aviation emissions grew only 0.3% between 1990 and 2018, and given 2.2% pa annual reductions in emissions over this period, the carbon footprint of domestic flying has dramatically reduced over the 30 year period leading up to COVID, and it has reduced even more dramatically during the pandemic.  Domestic aviation across the UK as a whole totalled only 1.5Mt (3.9% of the total) against UK international aviation emissions which were 96.1% of the total (or 36.7Mt).  In other words, the vast majority of UK aviation CO2 emissions are associated with international not domestic flights. This is particularly important in the context of Scotland, NI, Cornwall and the Crown dependencies, because, the percentage of air journeys that are domestic rather than international is much higher than in other parts of the UK.

 

Peripheral UK’s aviation- based carbon footprint is, therefore, far smaller than other regions of the UK and should not be swept up in generalisations about CO2 targets and policy for aviation at a UK level, especially when distance and travel time makes it a more important mode of transport to maintain these regions’ competitive connectivity.

 

Chart, waterfall chart

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This message is strongly reinforced by the graphic above from a recent Eurocontrol Report (below) which shows that the domestic and short haul international flights that dominate RABA Group’s air market, are responsible for only a very small percentage of overall European aviation emissions, whilst making up between 24-70% of departures, depending on the sector length chosen. This picture is confirmed by a further study by Deloittes[5] published earlier in 2021 leading to the clear conclusion that domestic aviation (which makes up much of the traffic from the UK’s regional airports) is both currently and prospectively a relatively low emitter of CO2.

 

This distinction, which many environmental NGOs overlook reflects the fact various categories of aviation play very different roles in relation to carbon emissions, and that geographical differences across the UK are very substantial.  In fact, the real culprit, facing the biggest challenge, is long haul aviation.  Whilst RABA Group fully recognises that aviation faces a series of environmental challenges, the largest of which is its carbon footprint, if it is to retain a ‘social license’ to grow, in our view that challenge is heavily weighted towards long haul airlines and therefore the larger airports, which they predominantly serve.