HC Deb 23 March 1961 vol 637 cc809-20

Motion made, and Question proposed, That this House do now adjourn.—[Mr. F. Pearson.]

2.35 a.m.

Sir Arthur Vere Harvey (Macclesfield)

I am grateful to you, Mr. Deputy-Speaker, for allowing me to raise the question of airport charges on the Adjournment even at 2.35 a.m., and I make no apology for doing so, because I should have raised it a month or so ago but, by arrangement with my hon. Friend the Parliamentary Secretary, it was agreed that I should raise it on another occasion.

The Minister for Civil Aviation intends to increase the landing fees at airports in Britain by 33⅓ per cent. next month. With great respect, I think that he is quite wrong in contemplating this step. The International Air Transport Association has protested to him, and I understand that the director of the association, Sir William Hildred, had an interview with him. I am told that there are 40 airlines using United Kingdom airports, 20 of which are equipped with turbo-fan aircraft.

It is well known that the airlines of the world, with scarcely an exception, are making very small profits; indeed, many are making losses. When I questioned my right hon. Friend about this decision about a month ago, he implied that he would not subsidise the airlines. Nobody is asking him to do that, but we are dealing with a comparatively new industry—which is expanding, perhaps, too rapidly—and I contend that in this respect Britain must not lag behind.

In my submission, the airports of this country, and certainly London Airport, could be more efficiently managed. London Airport was conceived after the war by the Labour Party—and I am sorry that no hon. Members opposite are present to listen to me. They went into the design and construction of London Airport showing little or no imagination and not taking into account what other countries might do or even what they had done. As a consequence, we have a cumbrous organisation at London Airport and passenger traffic is subject to many irritating delays.

The layout of London Airport, Central—as it is known—as well as the lengthening flight check in timings necessitates the employment of additional staff to ensure proper handling of passengers than would otherwise be the case. It is one of the few airports in the world where frequently on taking off or arrival one has to undertake a journey by bus to get to and from the aeroplane. On arrival it may require two buses. One must perhaps wait for a passenger who is suffering from arthritis and who comes down the steps very slowly. One is tired and wants to get home, but one must undertake a bus journey to reach the airport. That is because the airport was badly designed. It ought to be circular, with piers leading to the aircraft, as in many international airports of the world.

I now want to deal with the question of landing charges for aircraft. These were increased by 50 per cent. in 1957 and 28 per cent. in April, 1959, and now we are told they are to be increased in Great Britain by 33⅓ per cent. in April. These increases have taken place at comparatively short notice. I want to give one or two illustrations. When the new landing charges come into force next month the charge for landing a jet Boeing or a DC 8 will be £243. At New York, taking into account fuel tax, ancillary fees and all the extraneous charges, the landing charge is about £138, which is nearly £110 cheaper than in London. In Paris it is £115 at night; in Brussels £117; in Rome £102; in Copenhagen it is £74; in Frankfurt, £71; in Zurich, £58; in Amsterdam, £50 and in Hong Kong, £139. Britain is well in the lead, and this is very unfortunate.

The costs of running our airports are considerably higher than they are for running those of other countries. The operating costs of a commercial landing, excluding technical services in London in 1959–60, was about £57. At a similar airport in the United States it was £10 5s., and in Copenhagen it was £17. It has been contended that the rents paid by airlines for the buildings at London are included in the landing fee. On the contrary, airlines pay separately for their counter space, offices and any buildings they occupy. In London it is £7 per foot run, and in Idlewild it varies from £2 16s. to £4 4s. per foot run.

My right hon. Friend the Minister has said that when we take into account the fuel tax and other things are added up, it makes a very big figure. That is not really so. The New York authority has imposed a fuel levy on oil companies. Fuel facilities at Idlewild have been constructed at the authority's expense. Oil companies are charged small amounts to amortise buildings. This is a contractual arrangement and has nothing to do with landing fees. I am told that London is the most expensive airport in the world, with the possible exception of Khartoum.

I now go back to other matters affecting London Airport. A modern airport today must have a cargo depot to handle freight, which is increasing, probably at the rate of 20 per cent. a year. London Airport was planned to have three sheds of 90,000 sq. ft. each. We shall be fortunate if we have 60,000 sq. ft. by September of this year, and the project might not be completed until 1966. I contend that there is a strong case for an independent authority to operate these airports. I am not criticising my right hon. Friend or the Parliamentary Secretary. They have been in office only for a very short time, and I know that they are doing their best to tidy up the situation. Minor improvements have taken place in recent months as a result of their efforts. But if an independent authority operated the airports they would be comparatively free from Parliamentary pressures and would be better able to deal with labour problems. They would develop revenue earning sidelines and have closer relationship with the airlines and would be free from the cumbersome procedures of the Civil Service.

I wonder what my right hon. Friend pays the manager of London Airport. I imagine his salary is related to that of a certain grade in the Civil Service. My estimate is that it is not much more than £3,000 a year, with possibly a small entertainment allowance to look after V.I.Ps. when they come and go. But I am told that the manager of the Idlewild Airport gets nearer £20,000 a year. It is a vast industry. London Airport is not a small, fiddling airport, but an industry on its own. It needs a tremendous amount of managment. I am not saying that the existing manager does not do his job. He probably does it extremely well. Whoever it is, he should have a far greater salary than he receives at present. Probably he earns far less than many airline captains. The Port of New York authority insists that the airport must endeavour to pay its way, but that is certainly not the case at London Airport.

The additional cost of the airlines, as the result of the increase in charges will amount to £1½ million a year, but if the other airports follow suit, as they probably will, it will cost the industry £10 million a year, which will cause inflation among the airlines. I wish to refer to the road congestion and the car parking facilities. If one arrives at London Airport and there is a car waiting it is necessary to carry luggage over railway sleepers, and in the dark this can be really dangerous. I wish to know what will happen when the Central Buildings open later on; as I see it, the traffic congestion will be even worse. Yet I understand the Standing Joint Committee was assured as far back as 1953 or 1954 that the development plan made ample provision for parking and garage accommodation. The work on those garages has not yet commenced.

My right hon. Friend has got round the problem to some extent by an enormous increase in the parking charges and recommending passengers to travel by bus. But we should not tell passengers how they are to travel to and from the airport. If they want to use a private car and park it at the airport, they should be allowed to do so. I suggest that something needs to be done urgently.

In 1959 the airline movements in London were nearly 119,000 with passenger traffic of just over 4 million. At Idlewild there were 209,000 movements with nearly 7 million passenger traffic. At Los Angeles there were 234,000 movements with nearly 6 million passenger traffic. The reason is that those airports go out to attract traffic. Chicago is the busiest airport in the world with 354,000 airline movements and 9,500,000 passenger traffic.

I am told that 25 per cent. of the movements at Chicago are private or executive aircraft. It is extremely difficult for private aircraft to get to London Airport even with all the radio aids. We must approach this problem in a business-like manner and bring some sense into the whole situation. London Airport is a bad advertisement for Britain. I hesitate when I go to meet friends or business colleagues from overseas who arrive at London Airport. There are Customs delays, though that is not the fault of the officials, who do their best. The airport is already out of date and unsuitable for the job. I suggest that my hon. Friend asks his right hon. Friend, even at this late date, not to go ahead with these increased charges but to bring some efficiency into the industry by making more money with the facilities available rather than start a spiral by increasing the charges.

2.50 a.m.

The Parliamentary Secretary to the Ministry of Aviation (Mr. Geoffrey Rippon)

I am very sorry that my hon. Friend the Member for Macclesfield (Sir A. V. Harvey) had to raise this very interesting matter at such a late hour, particularly as it was for my convenience that he postponed the earlier discussion. Before offering what I hope he will regard as a complete defence to all his specific criticism, I should like to make a few general observations about the broader issues of airport management to which he referred. My right hon. Friend is by no means persuaded that the present arrangements for managing airports are the best or necessarily the only ones. He is at present engaged on a review of policy in this field.

One of the main questions being considered is whether any or all of the civil aerodromes at present owned and operated by the Ministry of Aviation should be handed over to some form of independent public authority. As my hon. Friend knows, the aerodromes were taken over after the war for operation by the Ministry of Civil Aviation, as it then was, when it was argued that the cost was so great and the problems so interwoven with other problems of government that there was no practical alternative to the course which was followed. From time to time the possibility of setting up a public authority to assume the management of these aerodromes has been considered, but even when some of the special difficulties which followed the end of the war had been overcome, there remained the impediment that the aerodromes were still casting a lot of money which had to be supplied for the Exchequer and were far removed from the time when they could pay their way.

In those circumstances, the aerodromes, even if transferred to a separate authority, would require subsidy and continue to be subject to the normal departmental and Parliamentary control of expenditure. As time passed and the commercial prospects of the aerodromes improved, the case for continuing the present arrangements becomes weaker and the disadvantages of departmental management become relatively more significant. The question we are trying to answer is, has the time now arrived when the disadvantages of Government management of the airports have outweighed the advantages? We feel that perhaps the growth of traffic, coupled with the new increase in landing charges, will both tend to place the airports on an economic basis and so widen the opportunities which my hon. Friend wishes to see for examining new methods of management.

My right hon. Friend and his predecessors in recent years have arranged for some of the provincial aerodromes to be taken over by local authorities, and there is a case for continuing this process further: but clearly this would not be a suitable way of providing for the future management of the main international aerodromes like Heathrow or Gatwick. The setting up of a statutory corporation to operate these and possibly some others as well has many arguments to commend it. I am sure my hon. Friend will understand that I can only say at present that these matters are very much in the mind of my right hon. Friend and that he will no doubt give the arguments put forward by my hon. Friend careful and sympathetic consideration. What form the corporation might take, whether it should correspond to the Port of London Authority or some other body, is, of course, another question. If it should be decided that a statutory corporation offers the best means of managing the main airfields in future, its structure will have to be thought out very carefully, and I am sure that my hon. Friend appreciates that all these considerations will have to be reviewed in some detail.

Now I turn to some of the more specific charges my hon. Friend made on the subject of airport fees, particularly landing fees. The argument has frequently been advanced that our charges are too big compared with those of other countries. I suggest that all attempts at international comparisons in this field are extremely difficult even if not impossible. There is far too much difference in the system of charges to make a really straightforward comparison. I think this is demonstrated by the I.C.A.O. manual on arport tariffs, a copy of which is in the Library. It runs to over 260 pages, and it is studded with qualifications.

Perhaps my hon. Friend has seen the admirable article in the 16th March issue of Flight, which I think disposes of two fallacies. The first is that the fees in London are the highest in the world. This is not so. The second is that all the operator has to pay is the appropriate landing fee. In many cases nothing could be further from the truth. There is, for example the case of Honolulu, to which the article refers. It states that Honolulu has the lowest landing fee for a Boeing 707/320 of any airport in the world—a mere 14s. 3d., but there is a State tax of 3½ cents per U.S. gallon and a local tax of 3½ per cent. on the basic cost of the fuel, neither of which is refundable. This means that the total cost bill presented for a Boeing which has uplifted 14,000 gallons of fuel is in the region of £246, which makes the 14s. 3d. landing fee slightly irrelevant. Many other States levy charges which are at present not levied separately in this country, for example for lighting, cargo service and fuel—not that it is always easy to determine what proportion of the charge on fuel goes into the airport accounts, having in mind the triangle of relationships between the airline, oil companies and the airport—

Sir A. V. Harvey

Will my hon. Friend accept the figure I quoted of £138, which is the average inclusive fee covering all the charges? If not, I will give him the proof from airlines to show him what they are paying.

Mr. Rippon

It is a very good illustration of my point. This comparison with Idlewild is frequently made. As my hon. Friend points out, New York has a relatively low landing fee but has seven separate terminal charges. In the case quoted by my hon. Friend of the Boeing 707/420, it comes to something over £110 basically. Of course, it does not include the charge for space rented by airlines for this fuel storage, and it does not include the charge paid by the airlines to the port authorities of about half a cent per gallon and intplane fuelling charge of 1½ cents per gallon. We do not know what proportion finds its way into the airport accounts—

Sir A. V. Harvey

The difference in the final fuel charge is ½d. per gallon cheaper in London than in New York.

Mr. Rippon

It is not the fuel charge which is relevant but the portion of it that finds its way into the airport accounts.

There is another factor at Idlewild. The charges for passenger ramps and the apron charges can vary widely according to the type of ramp used and the time for which it is used; it can vary from 5 dollars for each 30 minutes after the first free 45 minutes for some ramps to 100 dollars for each 15 minutes after the first hour at the ramp adjacent to the International Arrival building.

In any case, in any attempt at comparisons it is necessary to make many assumptions about the type of aircraft; when the operations occur; the passenger loads, and perhaps, the cargo taken, the length of stay on the airport, the passenger destination, and so on. Differences in these assumptions can produce far greater variations in apparent charges than differences in the scale themselves. For instance, the type of aircraft selected makes a very great difference. My hon. Friend selected a Boeing, but for a Viscount 806 of maximum weight 64,500 lbs. and an assumed average load of 42 passengers, the total charges after the April increase for an international flight, will amount to just under £39 in the United Kingdom as compared with just over £47 at Idlewild, which also has this fuel levy in addition—

Sir A. V. Harvey

But the British do not fly Viscounts across the Atlantic, so that does not really apply.

Mr. Rippon

But they land there from the West Indies and elsewhere.

All this shows that one has to have regard to the type of aircraft, and also, as my hon. Friend pointed out, to the type of service which is being offered, and the conditions under which the airlines pay for their accommodation; whether they rent it or whether, as in many United States airports, the whole of the building and the management of it has to be provided at the airline's own expense. It is not my purpose, though, to attack anyone else's charges. All I say is that this comparison is very difficult. I.C.A.O. itself tried it, and admitted that it was impossible. It went into the matter in 1956, convening a special conference for the purpose, and came to the conclusion that the standardisation of the actual levels of charges by setting maxima or minima or by any other means is impracticable owing to the widely different situations at different airports.

In any event, I do not think that that is necessarily the best test of whether our policy is right. Charges cannot be considered in isolation but must be regarded as part of policy. If a country decides, as a matter of policy, that it is prepared to subsidise indefinitely its airports, then it can keep charges artificially low. Our policy has been to move towards a situation in which the State aerodromes and the ground services going with them should eventually become self-supporting. I say "eventually" because, of course, hitherto, and still, the taxpayer has been giving very considerable assistance by bearing the difference between aerodrome costs and revenue.

Of course, as the House will know, last year the Public Accounts Committee in its Report, having observed that land- ing fees were last increased in 1959, endorsed the view that what the traffic can bear by way of landing fees and passenger service charges is a difficult conception which must be tested constantly. It has never been our policy to make one single revolutionary increase in charges. We have gone forward step by step. Experience has been that, as the charges have gone up, the traffic has continued to expand, and we believe that the same situation will apply here.

It is not reasonable to relate this question of charges to efficiency, as some people do. My hon. Friend has not sought to do so. But I do not accept the rather severe criticism which he has made of the services at London Airport. Clearly, there is much which may be done to improve it, and we are paying constant attention to the improvement of passenger handling and the improvement of other facilities. We are carrying out the extension of No. 5 runway and the modifications to the short haul building. The new long haul building will start to come into operation this year. There has been serious congestion in car parking, but it did not show itself until very recently, and the increased charges apply only in the peak summer months when there has been a growing habit for people to leave their cars for long periods of time. Here again, the position will be eased when the multi-storey garage is provided, and we hope to go out for tender very soon.

I do not think the position will be eased by a tremendous increase in private aircraft as, for instance, at Chicago and Idlewild. We should have to have a tremendous increase to make very much difference in revenue.

Sir A. V. Harvey

Executive aircraft.

Mr. Rippon

Private or executive aircraft. Heathrow handles more international traffic than does any other airport in the world, handling about 1 million more passengers a year than Idlewild. We handle them very well, I think. My hon. Friend referred to delays at Customs The average time taken to go through Customs is only about seven minutes.

We are doing what we can to increase revenue in a reasonable way. By any tests which can reasonably be applied, efficiency has been rising steadily at London Airport and at other airports. For example, per head of staff, between 1955 and 1959 passengers handled increased by 29 per cent. and transport aircraft tonnage increased by 41 per cent. I am confident that we are moving and must continue to move towards the point where our aerodromes should stand on their own feet financially. In the long run, this is, I am sure, the only basis for sound airport management and the long-term prosperity of air transport.

Sir A. V. Harvey

I am sure that my hon. Friend would not wish to go on record as saying that it takes just seven minutes to pass through Customs. That may be so, but it probably takes 20 or 25 minutes to get to the Customs, and then at peak hours there is a much bigger delay afterwards. Therefore, up to 40 or 45 minutes is taken.

Mr. Rippon

I do not think anyone disputes that at peak hours there is congestion. We certainly hope that it will be eased when the new long-haul building is built and when modifications are carried out in the short-haul building. I was merely answering the point about the delay at Customs, to which my hon. Friend specifically referred.

Question put and agreed to.

Adjourned at five minutes past Three o'clock a.m.