HL Deb 01 March 1973 vol 339 cc751-3
BARONESS BURTON OF COVENTRY

My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government whether they will make a Statement on the discussions held between the United Kingdom Civil Aviation Authority and the United States Civil Aeronautics Board concerning fares on the North Atlantic routes; what fares have been agreed and when these are to come into operation.

THE MINISTER WITHOUT PORTFOLIO (LORD DRUMALBYN)

My Lords, no agreement was reached between the two Governments concerned on the fares to apply on North Atlantic routes from April 1. The United States authorities have proved unwilling to accept advance booking fares on scheduled services from the United Kingdom at the competitive levels which British airlines are seeking and which the Government and the Civil Aviation Authority fully support. In face of this position and the urgent need for a decision on summer fares, European Governments met in Paris yesterday and agreed that, rather than accept the levels of fare proposed by the U.S. carriers, which were generally higher than those proposed by the United Kingdom carriers, existing fares should continue in force on North Atlantic routes, with limited adjustments to take account of changes in exchange rates. The European Civil Aviation Conference is urging airlines to implement this through IATA. Failing an IATA agreement by March 10, European Governments propose themselves to introduce fares on this basis. This is a disappointing outcome for this summer, and Her Majesty's Government and the Civil Aviation Authority intend, with other European Governments, to seek a more satisfactory arrangement for next year.

BARONESS BURTON OF COVENTRY

My Lords, while thanking the Minister for that detailed reply, may I ask him why, if the British Government and their agency, the Civil Aviation Authority, support the suggested fares put up by our own scheduled airlines in this particular case, they should not be able to enforce those fares on flights originating from this country? Is the noble Lord aware that I have just read in the Daily Telegraph, before coming into the Chamber, that the British airlines believe that the best way to fill empty seats is to reduce fares and that half the seats on the Atlantic routes are empty? Is there anything the Government can do to get this affair settled before next year?

LORD DRUMALBYN

My Lords, the answer to the first part of that supplementary question is the Bermuda Agreement, under which fares have to be agreed between the two countries concerned. It is a matter of bilateral agreement. Where that agreement cannot be obtained there is a complete breakdown of air services. We hope it will never come to that. It is possible that agreement will have to be reached on some such basis as the noble Baroness suggests, and that each country will operate on its own terms for traffic originating from that country.

BARONESS BURTON OF COVENTRY

My Lords, arising out of that answer, may I ask the Minister this further question? As we might gather from his reply that it seems possible to act irrespective of the Bermula Agreement, why can we not do it now?

LORD DRUMALBYN

No, my Lords; it is not possible to act irrespective of the Bermuda Agreement. To do what I was suggesting would need an agreement between the two sides that it should be done.

THE EARL OF ONSLOW

My Lords, arising from the fact that the noble Lord is saying that air fares could be dictated in the case of aircraft leaving a country, may I ask him whether they could not also be dictated in the case of aircraft arriving in a country as well, at this lower level?

LORD DRUMALBYN

No, my Lords; it is not a question of air fares being dictated. Air fares have to be agreed between the two parties to the agreement; that is, from where the flight starts and where it ends. They have to be agreed at both ends.

BARONESS BURTON OF COVENTRY

But really, my Lords, is there any reason why, if the American airlines cannot fill their planes, we should not be allowed to fill ours?

LORD DRUMALBYN

My Lords, the reason, I am afraid, is the Bermuda Agreement.

LORD O'NEILL OF THE MAINE

My Lords, might it not be possible to come to some arrangement with Canada, whereby we could fly cheap flights to Toronto and Montreal, both of which are comparatively close to New York, Washington and Philadelphia, and thereby force the hands of the Americans?

LORD DRUMALBYN

My Lords, we have already reached an agreement with Canada.

LORD REIGATE

My Lords, have we given notice to cancel the Bermuda Agreement, which seems to impede us?

LORD DRUMALBYN

No, my Lords; because that would leave an exceedingly open situation.

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