The Future of Aviation - The South East

The TUC response

1: Introduction: sustainable expansion is the best outcome

The TUC is committed to ensuring long-term full employment. Aviation is set to be a growth industry, providing jobs both directly in airports and airlines and through the other industries that it supports. The government has calculated that facilitating growth in the aviation industry should create 260,000 new jobs.

We are also conscious that ordinary working people are flying in ever increasing numbers. This democratisation of the skies is a welcome development that should be encouraged. It is not so long ago since the 'jet-set' was an exclusive club for the rich. The trade union movement is an international one, and the TUC will defend working people against any attempt to exclude them from affordable air travel.

However, we do not back the creation of jobs and the right to travel at any price. We are strongly committed to ensuring that growth is environmentally sustainable. However, our considered view is that it is possible to achieve strong sustainable growth in the aviation industry, and that this should be the goal of government policy.

2: The TUC's response

The TUC is the national trade union centre. Our 69 affiliated unions represent nearly 7 million working people. The TUC has consulted its affiliates before drawing up this response, and many of those unions have reported that they have consulted their members before replying.

The TUC would like to see the Government conclude the plan for the future of aviation as soon as possible. We were therefore disappointed that the court decision on Gatwick has delayed the process and led to a re-run of the south east consultation exercise, but we were heartened that the Government has committed to concluding the consultation process as quickly as possible.

In November 2002 the TUC submitted a national response to The Future Development of Air Transport in the UK. The government ran this consultation exercise as a series of regional studies. However, as national strategy will be needed, the TUC produced a single response to the regional consultation papers. Our earlier response should be read in consultation with the current paper as it sets our views on the southeast into a national context.

In looking again at the south east consultation (SERAS), we have given serious consideration to new evidence. However, although the original study excluded the possibility of expanding Gatwick, the TUC's national response considered the possibility that Gatwick might be included when the current agreement expires.

Our view about the development of airport development in other regions has therefore not been affected by the decisions to consider Gatwick for expansion. However, the TUC would like to take this opportunity register the following additional points on the national consultation:

• The government should bring the social partners together, and should itself take a strong view on the issue of employment conditions in airport security. Long hours, low pay and poor facilities are working against the achievement of high quality security protection.

• The TUC welcomes the recent planning decision to give the go-ahead for the proposed development of Finningley (Doncaster) to provide a new airport in the South Yorkshire area.

• Further detailed examination of the heavy use of the rail links at Birmingham International Airport has strengthened our view that this airport should be retained and expanded.

• Further examination of the pattern of demand in Scotland leads us to the view that new runways will probably be needed at both Glasgow and Edinburgh airports during the life of the 30-year plan. Our earlier view was that only one extra runway would be likely to be needed in this area.

3: Three new runways for the south east

In summary, our view is that the demand for air travel will grow strongly over the next thirty years. The result will be that London and the south east will need three new runways by 2030. Taking into account all the evidence, the TUC believes that Heathrow, Stansted and Gatwick will each need one new runway. It is clear that expansion at Heathrow should come first. At this stage, it is less easy to be certain which of the other two airports should come second and which should come third.

London is the leading destination in Europe for air travel. Our goal must be to ensure that this statement will still be true in 2030. There will be no benefit to the global environment or to the UK economy if strong growth in air traffic goes to Germany, France or Holland.

The debate about new runways has stimulated a wealth of new analysis, albeit of varying quality. The TUC has taken account of this new material, but there can be no doubt that that the government's overall assessment that London and the south east will need three new major runways is still robust.

It is clear that the UK must retain and develop a 'hub' airport in the south east that is a European leader. Failure to do this is likely to result in a severe loss of business to the French and German hubs.

In addition, sustainable development to meet demand for air travel in the south east is expected to generate 80,000 new jobs in the region. Some opponents of expansion have argued that the south east does not need any more jobs. The TUC finds this attitude both cavalier and repellent. There are still quite a few pockets of high unemployment in London and the south east. These people should not be abandoned just because the statistics for the region as a whole serve to hide their misery.

The TUC believes that the UK needs to preserve Heathrow as its hub. The first priority will therefore be to ensure that Heathrow gets an extra, relatively short, runway.

The government should consider whether it would be feasible to move the proposed runway 200 metres to the east, as suggested by BA. This realignment would result in greater overall land take, but would have the benefit of saving the historic centre of Harmondsworth.

We recognise that there are considerable constraints that need to be overcome in order to build a new runway at Heathrow, including considerable local opposition to expansion, but we believe that achieving this goal is a matter of national importance. All possible steps must be taken to minimize the impact of expansion on Heathrow's neighbours. In particular, increased capacity must comply with the current commitments on night flying limits.

Although the south east needs to retain and develop its existing hub airport there are obvious limits to development at Heathrow. The TUC does not believe that it is either feasible or desirable for Heathrow to handle all the predicted growth in traffic. One important consideration is to avoid flight paths into Heathrow becoming over crowded to an unsustainable degree. Another strong consideration is that airport growth strongly stimulates the local economy. New airport capacity must be distributed in a way that helps to balance the London economy.

We believe that certainty in planning is needed as soon as possible. Next year the government will need to say where the runways will go, and when they will be built. However, once such certainty has been established, an incremental approach to delivery is most desirable, with the additional runway at Heathrow being followed later by the second and third runways.

The TUC intends to explore the relative merits of expanding Gatwick or Stansted next after Heathrow when we respond to the forthcoming white paper. We are convinced that both will need an extra runway as part of the 30 year plan, but the best order for expansion is not yet clear to us.

In brief, there are business, operational and environmental considerations that point to Stansted after Heathrow. Proper management of expansion will also lead to valuable regeneration gains for north east London. However, there is also a very strong business and operational case for expanding Gatwick after Heathrow, using the 'wide-spaced runway' option.

In each of the three airports significant improvements will be needed to surface access, including improved rail links. These improvements should be put in place before the new runways open.

More broadly, significant improvements to the national rail network are vital to the development of an integrated transport system, and they are particularly important for London and the south east. They are not a substitute for developing aviation capacity but they are a vital complement, and should play a very significant part in delivering the government's integrated transport policy.

There are some valid arguments for building a completely new London airport at Cliffe. For instance, it would affect fewer local residents than any of the other options. However, we believe that the benefits of building at Cliffe are easily outweighed by other considerations, including the relative cost of such an initiative, the environmental cost of building on this Greenfield site, and the detrimental effect that this choice would have on the viability of the existing London airports. We conclude that the government should say now that Cliffe will not be included as an option in the forthcoming white paper.

If we succeed in maintaining Heathrow as a world-class hub then it will need to have good spokes. It is unlikely that Heathrow could meet all of the demand for UK regional services, as the government expects faster growth in the regions than in the south east. Stansted and Gatwick should develop as 'secondary hubs', and allow strong growth in regional air services.

Of course, many people will prefer to fly abroad from an airport near their home and in any case it is not desirable that all UK air passengers should have to pass through London. There should also be a greater role for our principal regional airports to connect directly to the European and other hub destinations.

However, it is clearly necessary to expand the main airports in the south east in order to allow growing demand from the regions to be met. It follows, of course, that the regional airports must each have some guaranteed access to the main airports in the south east.

Unsurprisingly, most of the public debate has been about new runways at the major London airports. We should not forget that there are actually fourteen airports of various sizes in the south east.

The biggest of these is Luton, which currently handles about one third as many air craft movements as Stansted. It is very likely that some improvements to the runway at Luton Airport will be needed even if three new runways are built elsewhere in London.

The most significant of the other airports in the south east are London City, Southampton, and Norwich. These airports currently handle about three million passenger movements between them, but this should rise to 8.5 million by 2030. All of these airports will need to upgrade their infrastructure to meet this increased demand.

There are also a number of smaller airports; namely, Biggin Hill, Cambridge, Farnborough, Lydd, Manston, Shoreham and Southend. Some of these airports are quite small, and many of them suffer from sharp limitations on their ability to expand. Nevertheless, it is expected that between them they might handle more than six million passengers by 2030, with Manston and Southend accounting for about 80% of this traffic

Some of the smaller airports are owned and operated by local authorities, which have recognised the social and economic value that an airport brings to the surrounding area. These airports provide a valuable alternative model to simple commercial development, and have strong input from representatives elected by local people. The government's aviation policy must ensure that these airports are nurtured and continue to thrive.

4: The cost of doing nothing

There are both costs and benefits from a significant expansion of aviation capacity, and the TUC has made it clear that it believes that the benefits considerably outweigh the costs.

It has rarely been considered in the public debate so far that there are significant costs to blocking expansion. These are clearly identified in the government's consultation document:

• A rise of £100 in the average fare from London airports by 2030 (at today's prices)

• A loss of 73 million passenger journeys. Many of these would be less well-off travellers.

• Increased congestion on the roads and trains as some passengers from the south east switch to regional airports

• Reduced air timetables within the UK and to EU destinations

• Significant costs to the UK economy, including increased business costs, loss of competitive position in relation to our EU partners, less foreign investment, and less inward tourism.

It is possible to use the same arguments that are made against the expansion of aviation capacity in order to argue against any kind of economic development. One strong parallel is that there has been the widespread local opposition to the establishment of new rail freight depots and rail-side access points. Almost everybody wants more freight to travel by rail, but nobody seems to want it to happen in their neighbourhood.

Development must always be environmentally sustainable and must balance economic, social and environmental concerns. If development were always prohibited then the UK economy would quickly collapse and we would soon have more than three million unemployed again.

5: Making development environmentally sustainable

The TUC believes that it is possible to make the development of the UK's aviation capacity environmentally sustainable. We set out eight headings for work in this area in our November 2002 submission. We developed these arguments further in response to the Treasury's May 2003 consultation Aviation and the Environment: Using Economic Instruments.

The first principle of sustainable development is that industries should pay in full for their environmental impact (the 'polluter pays' principle). Until recently, the environmental impact of the aviation industry has been calculated at about £1 billion per year, which is roughly the same amount as the industry pays through the air passenger duty environmental tax. More recent government estimates have put the environmental impact about 40% higher than previously thought, although these figures are currently subject to review. Current estimates are based on economic modelling alone, and are likely to be revised if they were to be triangulated against the measurement of actual pollution levels. It is obviously strongly desirable that the figures are confirmed before any change in taxation policy is introduced.

The main areas of environmental concern are the production of greenhouse gases and the noise of aircraft movements.

The TUC's proposal for dealing with emissions is the introduction of an 'Open International Trading Permit (emissions trading) System' for greenhouse gases.

Under this system, businesses would be issued with emissions permits, which, in sum would meet national and international emissions targets. Airlines would then be able to trade their emissions quotas with other industries and with each other. Such a system would focus investment on reducing emissions in a more efficient way than would taxation. Allocating an economic value to emissions in this way would encourage long-term progress in reducing greenhouse gas emissions whilst allowing the benefits of air travel.

In the USA, such a system reduced sulphur dioxide emissions by half. This result was achieved at half the cost of an across-the-board restriction [1] . The establishment of such an international system would facilitate the achievement of the Kyoto Protocols.

Obviously, the more countries that adopt such systems, the greater the gains that could be made. Our goal should the establishment of a global emissions trading system. However, in the short-term we favour making the first priority action by the European Union to cover EU airspace. The likelihood of a European 'open skies' agreement makes it imperative that there is an agreement on emissions at European level.

The emissions permit system should be reinforced by changes to the planning laws and the CAA regulations to ensure that environmental gains are made at airports and in aviation technology, particularly in the case of new build and new fleet purchases.

We favour the introduction of an emissions trading system because such a system directly focuses on reducing emissions to set limits. There are a number of other options open to the government, including regulation, promoting best practice and voluntary agreements as well as economic instruments. Given our preference for an emissions trading system we regard conventional taxation as a second best solution because of the inherent possibility of unintended outcomes, some of which are identified in the recent Treasury/ DfT consultation paper. A key danger is that such taxes become transposed in practice, so that they are actually levied on energy rather than emissions.

We believe that noise should be treated somewhat differently from gas emissions, not least because it is a rather difficult thing to tax. Our view is that noise can best be dealt with by a combination of regulations that set standards for planes and limits for airport use. For instance, expansion at Gatwick and Stansted must be matched with the introduction of a robust noise contour cap.

The record of the industry is on reducing air traffic noise is actually very good, and it should be remembered that the next generation of aircraft would be in use by 2006, before any new runway is built in the south east. These new 'Chapter 4' aircraft have to be 14 decibels quieter than the current standard.

Much more can still be done, but it will never be possible to eliminate all the noise from airports. The TUC also believes that the government and the industry should get together to ensure that those who are badly affected should be helped. Mitigation and compensation methods should include the provisions of high quality noise insulation, assistance with relocation and straightforward monetary compensation.

One result of airport growth is that local house prices always rise. Yet despite the increased mobility that such price rises bring, many homeowners will not see such rises as proper compensation for the disruption of their lifestyle. The TUC's view is therefore that the political goal of delivering major infrastructure projects in a speedy way also needs to be considered when compensation levels are set.

One strong consideration is how surface access may be improved. Air quality problems around Heathrow owe at least as much to the number of cars arriving at the airport as they do to the number of aircraft that use it. Expansion of the three main London airports must be matched by improved surface rail access, plus improved London Underground access to Heathrow. These improvements should only be the first steps in a bold and comprehensive plan to bring about a modal shift away from the private car in access to airports.

A second important consideration concerns National Air Traffic Services. NATS play an absolutely vital role in ensuring that air traffic movements are safe. They also play a very important role in ensuring that air traffic movements are efficient. For instance, they strive to eliminate the need for aircraft to queue before landing. Their work cuts down both noise and emissions. It is vital that the government ensures that NATS has sufficient resources to deal with the forecast rise in air traffic, and that the growth of NATS' capacity runs ahead of the growth in air traffic.

6: Conclusions

The future prosperity of the UK as a whole and the south east in particular depends in no small part on the provision of sufficient airport capacity. Heathrow, Stansted and Gatwick must be the lynchpins in developing aviation in the south east, although we should not forget the supporting role played by the other airports in the region.

If we do not rise to the challenge of meeting increasing demand for air travel then we will lose many desirable things, including:

• the creation of 80,000 new jobs;

• the right for ordinary working people to travel abroad;

• UK business competitiveness;

• Foreign investment;

• Inbound tourism.

These are not benefits that we should throw away lightly. In the early 1980s and 1990s the UK twice suffered the waste and horror of mass unemployment. The TUC is absolutely determined that those dark days shall not come again.

Nor do we subscribe to the class-war view that ordinary working people must always take their holidays here in the UK whilst the better off continue to take their holidays abroad. We believe that a catering assistant has just as much right to travel abroad as does a Countess.

In sum, there is a very strong case for building three new runways in the south east during the next thirty years. Having considered all the evidence, the TUC believes that new runways should be built at Heathrow, Stansted and Gatwick.

Heathrow's extra runway must be built first.

Whether the second runway is at Stansted and the third at Gatwick or vice versa must be decided fairly quickly. The TUC will submit detailed evidence on this issue in response to the forthcoming white paper.

On the evidence available we have rejected the construction of an entirely new airport at Cliffe.

In addition, a number of lesser improvements will be needed at these airports, and at several of the smaller airports in the south east, including Luton, London City, Southampton and Norwich.

The main risk of expansion is that it might cause environmental damage. This is a very serious consideration, but the TUC believes that development can be made sustainable.

The industry must pay in full for its environmental impact, and greenhouse gas emissions and noise must be strictly regulated.

There are a number of fruitful avenues that can be pursued in order to make airports better neighbours, including improving the quality of surface access. Everything that can be done must be done.

The clear task for the government is to ensure that we get the benefits of expansion whilst protecting the environment. The TUC will do all that it can to assist the government in this task. We look forward to the publication of the aviation white paper as soon as possible.

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[1] Source: Trading in Pollution, OECD Observer, August 2002; Implementing Domestic Tradable Permits: Recent developments and Future challenges, OECD (2002)