HL Deb 26 November 1981 vol 425 cc849-50
The Earl of Kinnoull

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

The Question was as follows:

To ask Her Majesty's Government whether they will confirm reports that the Dutch Government are providing a 35 per cent. discount for air travellers flying from Schiphol Airport to the Far East with the national airline KLM and whether the Government would consider similar action for British airlines.

The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Lord Trefgarne)

My Lords, fares between the Netherlands and other countries are a matter for the Governments concerned and we have no role in their approval. They are, of course, of interest to United Kingdom airlines who operate in parallel markets. I am advised that there have been changes in fares from Amsterdam to Far East destinations and in some cases significant reductions. We have been assured by the Dutch Government that these changes have come about as a result of the commercial judgment of the KLM management related to the competitive market position. The Dutch Government have also assured us that no subsidy to KLM is in any way involved.

The Earl of Kinnoull

My Lords, may I thank my noble friend for that assurance and information. Would my noble friend comment on how serious Her Majesty's Government take the obvious competitive threat that Schiphol Airport offers to future interlining traffic of the London airports?

Lord Trefgarne

My Lords, this is a matter for the managements of the airports concerned. The general position of Her Majesty's Government in these matters is that we seek to achieve a competitive environment in these things and the arrangements at Schiphol are clearly part of that.

Baroness Burton of Coventry

My Lords, is the noble Lord the Minister aware that the Dutch Government are now supporting a wide range of low-cost fares? Is he further aware that many of these discounted fares which formerly were available only in the "bucket shops" are now available at all travel agents in Holland? Can he, finally, tell the House whether the Dutch Government have legislation similar to ours saying that such action is illegal, or whether they have not?

Lord Trefgarne

My Lords, as I have explained I think on numerous occasions to the noble Baroness, this is not a question of national legislation but a question of agreement between the Governments concerned. I am not in a position to comment upon the agreements between the Government of Holland and the other Governments with which they do business.

Baroness Burton of Coventry

My Lords, I am sorry; that is not the question I asked the noble Lord. I asked him whether the Dutch Government had legislation similar to ours which made such action illegal or whether they did not.

Lord Trefgarne

My Lords, I am quite certain that there is no provision in Dutch law to allow things which are contrary to international agreements.

Baroness Trumpington

My Lords, may I ask the Minister whether the 35 per cent. discount means that it is cheaper for British travellers to fly to Schiphol and then take KLM aircraft to the Far East?

Lord Trefgarne

My Lords, I do not think I can do that arithmetic in my head, but certainly the economy fares offered by British Caledonian and British Airways between London and Hong Kong, for example, are between 30 per cent. and 9 per cent, lower than the economy fares from Schiphol.

Lord Beswick

My Lords, while I appreciate what the noble Lord said about the position of the Government in these matters, he has defined their role, he said, to ensure a competitive position. But is it not necessary to ensure that the competition is fair? Is there not a case now—again I appreciate the difficulties—for saying that we could have regulation of fares or we could have a situation where there is no regulation of fares? Surely, it is quite absurd to have the present nonsense. Can the Government not do something more to get sense into this matter?

Lord Trefgarne

My Lords, I agree with the noble Lord. Unfair competition is certainly not part of our policy and is not something we seek to achieve. That is why we were at pains to ascertain from the Dutch Government that there was no question of any subsidy so far as KLM were concerned.

Lord Davies of Leek

My Lords, is the noble Lord aware that some of us should be wary of over-competitiveness in the use of aviation machines, and that many of us would prefer the security of flying with cool-headed British aviators and aeroplanes to running all round the world looking for cheap fares?

Lord Trefgarne

My Lords, as a former pilot, I welcome what the noble Lord says.

Back to