Civil Aviation Policy

HL Deb 27 June 1984 vol 453 cc932-67

4.8 p.m.

Debate resumed.

Lord Underhill

My Lords, the House will be grateful to the noble Lord, Lord Peyton of Yeovil, with his ministerial experience, for initiating this debate on the important subject of civil aviation. I think it will be agreed that we have had a frank and challenging speech from the noble Lord. I was very pleased to see that his Motion covers aviation policy and airport policy, because both are complementary.

The noble Lord referred to the different inquiries and consultations which are taking place: the CAA consultation. the examination by the other place's Select Committee into airports, and the Stansted inquiry. Would it not be better to await the results of all those inquiries before the Government come to any firm decisions? Moreover, would it not be desirable before the Government implement any policies, that there should be debates on all three issues, before going ahead with any policy implementation?

The Government are proceeding with their plans for—I have to use this word—privatisation of BA. The Government seem to see privatisation and competition as a panacea for all our various problems. The Secretary of State in the aviation debate last Friday in the other place said (in column 597 of Hansard): Competition comes first in the Government's policies, but it must be fair competition, But it is understood that there is little opportunity for two British scheduled airlines to compete with each other on the same routes. World aviation is not run on the basis of laissez-faire competition, yet the Secretary of State complained in the same debate (at column 596 of Hansard): The evidence of the benefits of competition are overwhelming. Where, my Lords, is there such evidence in the United Kingdom context?

Of course, we all wish to see lower fares wherever possible and must work towards that end, including action within the EEC. These can be achieved only by agreements. Any fares policies must be consistent with a licensing system which ensures the best use of capacity, the maintenance of a network of services, achieves the highest possible standard of safety, but also takes into consideration the question of employment and proper conditions of service for employees.

The experience of the United States on deregulation is quoted frequently by the Secretary of State to justify similar proposals for deregulation here. But I was pleased to see the cautionary statement by Mr. David Mitchell. the Under-Secretary of State for Transport, in winding-up the debate in the other place, who said at col. 654: We do not seek total deregulation … Total deregulation would mean that some would grow and that the weakest would go to the wall". How true!

The CAA have produced two very useful documents—on a comparison between European and USA fares, which they published in May 1983, and on the deregulation experience in the United States which was published in May 1984, just last month. These stress that making genuine comparisons is very complex. The United States is not Europe, with its some 30 sovereign states, and certainly is not akin to conditions in the United Kingdom. One of the reports cautions that failure to compare like with like will inevitably end in misleading conclusions.

In the same debate, the Secretary of State said, at col. 598: To realise the full potential for market responsiveness and innovation, it is essential to transfer British Airways into the private sector". Where is the evidence for that claim? At present British Airways is being showered with congratulations for pulling things round, but it is pulling things round in the public sector. Why change, except for doctrinaire reasons? No positive evidence is advanced. In its submission to the Civil Aviation Authority, British Airways claims that it is now a greater force to be reckoned with because it has achieved, largely by its own efforts under public sector ownership, a degree of efficiency in terms of cost and performance that puts it very high indeed in the international league.

We know that both BA and BCal are not their sole masters. They are restrained by inter-airline and intergovernmental agreements, mostly of a bilateral nature. We face the fact that in Europe most national states will undoubtedly wish to maintain their own national airline and in Britain to change the procedure of the award of licences by the Civil Aviation Authority by the alternative of deregulation and a free market is not possible. Indeed, it is just not available and it could be against our national interests.

I was pleased to see that the Civil Aviation Authority in their interim assessment stressed that their consultation is about strengthening the ability of British airlines to compete with foreign airlines and about what is best in the national interest. That we must keep in mind—what is best in the national interest; not what is best in any particular airline's interest.

I would remind the House of the last major review of civil aviation in the Edwards Report of 1969, which confirmed state airlines as major operators of British scheduled services; encouragement was given to the private sector to create a "second force" airline licensed to operate a viable network; encouragement was given to the development of inclusive tours and other passenger and freight charter operations. We Know that since 1971 14 airlines have failed and we praise BCal as being the sole survivor to those British airlines who sought to operate long-haul scheduled services.

Let us look at the position of British Airways. In its response to the CAA, British Airways stated in paragraph 1.8: Whether structural changes in the industry are desirable is an issue almost wholly unrelated to the ownership of British Airways". It said much the same in paragraph 2.10: The fact is that ownership is substantially irrelevant to the ability of British Airways to deploy such market power as it possesses and to operate effectively". It put the position very clearly in paragraph 6.7: The relevant point is that both British Airways and British Caledonian face competition from foreign airlines on all international routes. The ownership of British Airways has no bearing on this fact of life". Whether in the private sector or in the public sector, I must ask: should British Airways be reduced as Britain's national carrier? In whose interest would that be? Certainly, fragmentation of British Airways would be disastrous. Should British Airways' dominant role be undermined? We have to bear in mind that on most international routes British Airways itself competes with foreign airlines. Does the strength of BA give it market power in making the necessary bilateral agreements and in facing intense competition with other airlines?

The Civil Aviation Authority stated at paragraph 2.2.10 of their interim document that—and I paraphrase—a major consideration is whether BA's dominant position is a strength or a weakness in terms of transport policy objectives. It is interesting to note that much of the criticism from the independent airlines is that monopolies in public ownership are likely to attack the market share of competitors more vigorously than are state concerns, and that the position in that respect could worsen with the privatisation of British Airways.

We know that only a few international routes can sustain multiple designation from countries at either end of the particular route. It is one thing to consider transfer of routes as a matter of considered airport policy, but exclusion of British Airways from some routes and substitution by another carrier cannot be justified on principles of competition. In that case, competition would be in the allocation of routes and not in the actual standard of service operation. Again, I find that the CAA document states at paragraph 2.1.6: Of the 76 countries to which British airlines fly scheduled passenger services, only 13 are served by more than one British carrier—only 13 destinations overseas are served by more than one British operator". Noble Lords will have seen a letter in the Financial Times of 20th June from Mr. Roy Watts, the former chairman and chief executive of British Airways, who wrote: International civil aviation is government business operating under government bilateral agreements. Licensing many UK carriers against a typical foreign carrier weakens rather than strengthens the British position". The issue seems to be: how to develop BCal as a second force airline while, at the same time, not weakening BA in any way as a national carrier and in its efforts to make agreements with other airlines.

I said at the outset that it is important that we are considering aviation policy and airports policy together. Both are interdependent. Airports must satisfy not only the needs of British airlines, particularly those of our international schedule services, but also the needs of other countries' airlines. I understand that at the moment some 174 of the world's airlines are handled by the British Airports Authority. Who will deny that that authority is a successful organisation? In fact, it has been a success since its establishment in 1965, yet the Government's policy is to sell off. I must ask again: why dispose of a successful public sector organisation which has proved itself? What will be gained?

A number of noble Lords were present, as I was, at the topping out of the fourth terminal. It has not been sufficiently stressed that the cost of the fourth terminal has been met not from Government funds, but from the internal resources of the British Airports Authority—a great achievement. However, if it is to be in the private sector, it will be in the best interests of British aviation, and of the nation generally, if all airports at present under the BAA are kept together in one organisation. We welcome the statement by the Government that they recognise the necessity to keep together the three South-East airports of Heathrow, Gatwick, and Stansted. That is essential. However, it could have an effect on Scottish routes and Scottish airports. My noble friend Lord Carmichael of Kelvingrove will deal with this aspect when he sums up at the end of the debate.

As the noble Lord, Lord Peyton of Yeovil, stressed, Heathrow is nearing the maximum of its air transport movements each year. There is little possibility of further expansion. In my view, there will be considerable opposition to any suggestion that there should be a fifth terminal. I note that the Secretary of State is to issue a consultation paper on the maximum of 275,000 air transport movements. There seemed to be a suggestion that as a result of the control of noise order which we passed recently, there might be a relaxation of the maximum. May I ask whether there is any extra runway capacity at Heathrow to cater for any future growth of traffic? If there were to be any increase in the number of passengers beyond the present projected limit of 38 million, even if it could be handled with the existing four terminals and the present runways, would any increase beyond that figure bring problems of road congestion? Incidentally, London Transport—which now that the London Regional Transport Bill has received Royal Assent, will be separate from the GLC—ought to be congratulated on the speedy action it took in extending the Piccadilly line right into the fourth terminal. I understand that it will be in use by the time the fourth terminal at Heathrow comes into operation.

Gatwick is also an important airport. I understand that a statement has been issued during the last few days which shows that Gatwick has now achieved the position of being the world's fourth biggest airport. Previously it was the fifth biggest. Transport movements at Gatwick are limited by runway capacity to 160,000. It seems, however, that there is spare capacity which would allow for some build-up. We understand that with the opening of the second terminal in three years' time, the number of passengers which can be handled at Gatwick will be doubled to 25 million. However, as the noble Lord, Lord Peyton of Yeovil. stressed. by the mid- 1 990s the expectation is that there will be a need for additional capacity in order to handle the expected increase in the number of passengers. With the existing constraints at Heathrow and Gatwick, how will that be done, and where will it be done? I echo the question asked by the noble Lord, Lord Peyton of Yeovil.

The report of the Stansted inquiry is urgently awaited. At the end of the day we must consider not only the needs of British Airways and BCal, but also the needs and wishes of the airlines of other countries. It seems that at present most of the airline passengers of foreign countries—not necessarily the airlines, but the passengers—wish to use Heathrow. I understand that no foreign competitor has yet been persuaded to leave Heathrow. What would induce a foreign airline to move from Heathrow to Gatwick? Perhaps the Minister can tell us. What we do know is that we must avoid foreign airlines looking favourably towards continental airports, such as Frankfurt, Schiphol, and Paris.

We also need to consider very carefully the role of the regional airports. Clearly there must be feeder services from regional airports, but we must not overlook the fact that the domestic market is only a very small part of the total scheduled services of British airlines. How far can Heathrow handle further domestic flights? In the light of the present maximum of 275,000 air transport movements, any extension of domestic flights could chase away foreign carriers. Therefore, whatever the Secretary of State may say about deregulation, there must be regulation of at least domestic services. Deregulation would not be feasible. It would be absolutely impracticable. We are faced with the situation that many domestic services in Britain cannot support economically more than one operator.

In conclusion, I am concerned also with the position of the five regional airports owned by the metropolitan county councils which, as noble Lords know, are to be abolished if the Government get their way on the abolition Bill. The Government never thought out what was going to happen to the airports, any more than they thought out anything else, other than their political decision to abolish the metropolitan county councils. The Secretary of State hopes to get the district councils to agree to take them over. If the regional airports are to be disposed of, surely it would be in the best interests of everyone concerned if the airports were placed in the hands of the passenger transport authorities in those areas. They, albeit, will be joint boards under abolition. They will be considering all transport matters—road matters and other traffic matters, which are very important.

In the light of all the reviews and consultations. the results of which we await, I can understand the Government's difficulty in replying to many of these points, but it is essential that airport policy and aviation policy should be considered together. It is in the interests of all users. The national interest, environmental considerations, road congestion and other traffic problems must be taken account of in all these policies.

4.27 p.m.

Baroness Burton of Coventry

My Lords, every one of us speaking today will, I am sure, be very grateful to the noble Lord, Lord Peyton of Yeovil, for giving us the opportunity to debate this important matter. It seems to me that it would have been most unfortunate, when the other place had had an opportunity to debate this issue, if we had not had a debate. I believe that there is a wealth of experience in this House. I hope very much that what we say today will contribute to a solution of the problems.

I was very interested to hear the noble Lord, Lord Peyton of Yeovil, refer to the expense of these long-ranging inquiries. I could not agree more. I have always felt very strongly about Stansted. This is the third long-ranging inquiry that there has been into Stansted, a matter which I have already raised in this House. It is most unfortunate for the residents of Stansted that, after the matter had apparently been settled, it should have been raised again. The expense is enormous. Having said that, I should like to pay a tribute to the inspector who is conducting the Stansted inquiry. In common with many other noble Lords, I have read a good number of the submissions and have admiration for the way in which the inspector has handled them.

Turning to the Motion which the noble Lord, Lord Peyton of Yeovil, has put down on the Order Paper today, I think we would all agree that the current problems are many and varied. Most of us who are to speak today would probably compile a similar list. Equally, most, if not all, of us have been the recipients of a great deal of paper, which I, for one, have found useful. But without wishing to receive no paper at all in the future, may I say that we have had a lot, and leave it at that?

Having read the submissions—I have read all that have come to me—I have decided to await the report of the Civil Aviation Authority before coming down on one side or the other of the many difficult decisions which have to be taken. It seems to me that it is for the Civil Aviation Authority in its forthcoming report to advise the Government on this opportunity to create a prosperous and well-balanced—I underline "well-balanced"—civil aviation industry. Obviously, any final decision must rest with the Government.

I want to deal in more detail with the future of airports, but before doing so I should like to comment on what to me, anyway, must be one of the most important problems—indeed, I believe it to be basic: the question of routes allocation. The Government are committed to the privatisation of British Airways in, I believe, the spring of next year. In the magazine Flight of 23rd June last, I read that the Department of Transport is unlikely to reach a decision on any implementation of the CAA recommendations before December. I am sure the House would agree that that is not an undue amount of time to take in looking at some very important matters. But can we be told whether it is the Government's intention that both Houses of Parliament should have an opportunity of debating the civil aviation report before any Government decision is announced—or are we to be presented with a fait accompli? In my view, should the report advise restructuring, then the actual privatisation would probably have to be delayed because, I would submit to the House, any restructuring must precede privatisation. In so vital a matter, surely the Government will welcome advice from Parliament too.

I must just say something about European air fares. It is high time that some were reduced; many are far too high. I would be asking for undue time today, however, if I were to attempt to speak on this subject in detail. But I do want to congratulate the Secretary of State (Mr. Ridley) and the Government for what they are trying to do in this respect. I should like to congratulate also the airlines involved —British Airways, British Caledonian, and Air UK—and the Netherlands, whose Government have agreed to participate. But I have a "but". The "but" is the price that Britain has paid. I note that this agreement is described as being a milestone towards cheaper fares in Europe. I hope that this is so. We need all the allies we can get in our endeavours to breach a wall constructed mainly by nationally-owned state airlines.

Is it true—and I am asking the Minister this question—that the state airline KLM can now fly to any airport in the United Kingdom that it does not already serve and can take passengers via Amsterdam to destinations on its worldwide network in direct competition with United Kingdom operators? If it is—and I would ask this also of the noble Lord, Lord Trefgarne—do we not face considerable loss of traffic from United Kingdom airlines? I shall be grateful, as I am sure the House would be, if the Minister will comment on this matter when he comes to reply. In other words, have we given away sixth freedom rights to secure these cheap fares?

There are many speakers to come, and so I will leave my own list of problems—including debatable topics such as over-capacity, discounted tickets and air charters—and move on the airports and to Gatwick. I hope that the Minister will provide the House with a considered reply—in writing if not at the end of this debate. Perhaps I may stress that I do not mean a favourable or an unfavourable reply but one that is really considered. I will begin with a categorical statement: Gatwick Airport will not be developed to its full extent or to its full potential without a second runway. Apart from repetition to the effect that the Government have no intention of laying down a second runway, which we all know by heart, will the Minister state whether he accepts the truth of what I have said; namely, that Gatwick cannot be developed to its full potential or its full strength without a second runway?

Going on from there, I suggest that we have to consider four aspects. First, there is the position of the Government. I have no wish to embarrass the noble Lord, Lord Trefgarne—at least, not too much—but I have been concerned with this matter for some time, and on 8th March the Minister was honest enough to admit to me that on 24th January 1979, being on a different side of the Dispatch Box, this subject had produced from him a different answer. Leaving 1979 aside and coming up to date, to 23rd May 1984, I asked the Government whether they considered themselves bound by the agreement entered into in 1978 between the British Airports Authority and West Sussex County Council to the effect that no second runway would be built at Gatwick Airport. The noble Lord, Lord Trefgarne, replied (and I quote from col. 221 of Hansard): The present Government were not consulted about the agreement and are not parties to it. That being the case, the Government cannot be bound by its terms". Moving on to the second aspect—namely, the environmental reactions of residents of the area surrounding Gatwick—I have received a letter from the chairman of the Gatwick area conservation campaign. This is dated 2nd April and conveys regret at what I am trying to bring about. It is a courteous letter and I hope that I replied in kind. I endeavoured to explain I did indeed understand that nobody could be expected to welcome a development that might bring additional air traffic overhead; the difficulty was that I did not believe that 25 million passengers per annum could properly be serviced by a single runway. That must apply to residents anywhere who are close to any airport or to any projected airport. This raises the question of Stansted with, additionally, the problem of losing some of the best agricultural land in the country today. Hence, those of us fortunate enough not to live under a flight path or close to an airport can only say, with what must seem a selfish attitude, "If there has to be expansion, this expansion must come somewhere".

The third aspect is that of air traffic movements, to which a reference has already been made. They are generally known, in this world of initial letters, as ATMs. They are proving a headache in the light of a further limitation to a maximum of 275,000 ATMs per annum at Gatwick when Terminal 4 becomes operational next year. With Gatwick having only one runway, where are the surplus traffic movements to go?

On 5th April (at col. 791 of Hansard) the noble Lord, Lord Trefgarne, told the House: The Government are presently considering how the allocation of movements will be awarded, but we hope very much that so far as is possible it will derive from agreement among the operators". The phrase "so far as is possible" envisages a certain amount of disagreement. How do the Government propose to deal with this matter? Equally important, when do they propose to deal with it? Can we be told what progress has been made and how far in advance of Terminal 4 being operational next year will these decisions be finalised and announced? After all, any airline has to plan its movements well ahead.

I understand—and I am sure that the Minister will tell us this when he replies—that we are soon to have a consultation paper from the Government on this matter—but perhaps he will give a date. As the Government were not consulted about the 1978 agreement, were not partners to it, and do not consider themselves to be bound by it, then surely they must give some thought to the weight of opinion against the maintenance of a single runway.

I come now to the fourth aspect; that concerning finance. Even the Government, and through them the British Airports Authority, must consider whether the cost of a second runway at Gatwick, bringing the airport to its full potential and resultant additional finance, should not be weighed against the cost of another major airport—and one in South East, as regional interests will certainly stress.

In conclusion, I have tried to set out my case and I await a considered reply. When considering what that reply is to be, may I ask the noble Lord, Lord Trefgarne, to bear in mind three points? First, on 8th March the noble Lord, Lord Beswick, told the House that when Gatwick was originally planned it was always intended that there should be two runways. Further to that, he maintained that the two runways had absolutely nothing to do with wide-bodied aircraft development but with the protests of residents around Gatwick. I will only say that there will be protests against any development anywhere—and the Government cannot shuffle out of them by saying that there will be protests at Gatwick.

Secondly, will the Minister in his reply please not resuscitate the arguments supporting the upgrading of the taxiway at Gatwick? Those arguments were discredited in this House on 23rd May and 5th June. I am informed that the British Airports Authority has awarded a contract to Costain Civil Engineering for the upgrading of the taxiway in the sum of £5,100,000.

I am not for one moment casting aspersions on the ability of Costain Civil Engineering, but I think this is an absolute waste or taxpayers' money. The Government are refusing to admit they have been wrong. I cannot see the point of spending £5,100,000 on an upgraded taxiway which cannot serve as an alternative runway, being unsuitable for fully laden transport planes to take off or to land. I ask the noble Lord the Minister even at this late stage to consider the financial implications.

Gatwick Airport has enormous potential. I read today in the newspapers and in what has been sent to me how very greatly Gatwick could extend. If we consider the possible range of European destinations, the level of service frequencies and the ease of interlining, they all speak for themselves. Taken together, they would develop Gatwick into a well-balanced hub of air traffic. In order to accomplish this, two runways must be provided.

Do the Government intend to deny Gatwick its full potential? If so, the ultimate responsibility will be theirs because the decisions rest with them, as admitted by the noble Lord. We all want a prosperous and well-balanced civil aviation industry, and I hope that our debate today will help to bring this about.

4.41 p.m.

Lord Balfour of Inchrye

My Lords, for the few moments that I intend to speak I wish to deal with one subject only. and it was mentioned by the noble Lord, Lord Underhill. twice in his remarks—the question of safety in the air. Many years ago—more years than I care to remember—when I started my flying career I was reminded of two things: firstly, that what goes up must come down; and, secondly, if God had meant us to fly he would have given us wings. I have always remembered those two truths. They particularly apply to flying today, just as they applied to flying in the past. There is today always a risk present when any of your Lordships defy the laws of gravity.

There is only one question: is it an acceptable risk? We all take risks in our lives. We take a risk when we cross the street, but it is an acceptable risk. Is flying today an acceptable risk? The answer is, yes, when you think that British Airways carried some 14 million persons last year in safety, all the time challenging the laws of gravity. I think we can say that it is safe. There is also the other side of the picture. In 1983 approximately 2,000 people were involved in serious crashes. Over 1,000 people were killed, and crews as well. That is an awful lot of lives to lose.

We are now entering into a new, highly competitive area in our passenger flying. Economy at the expense of safety must never appear in our flying studies. Risk must be accepted, but right down the line where costs have to be cut, from the board down to the man who is cleaning the aeroplane, there must never be a risk of cutting down your maintenance on grounds of economy. I am quite sure that the board of British Airways is firm, and, indeed, the boards of other companies are firm, in that determination. But we are all human, and perhaps down the line there may be a temptation here and there to cut corners. That temptation must be vigorously resisted.

We have seen a revolution in safety thanks to the pioneering work of British Airways in blind landing. There used to be a saying in the old days of flying when the weather was bad, "Visibility is nil: even the birds are walking". Today, if visibility is nil the birds may still be walking but Tridents and other British Airways aircraft continue to operate. That is an example of the distance we have gone in developing safety.

I should here like to pay tribute to those ground control operators who do such a responsible job, particularly when the weather is difficult. They deserve our praise and recognition thoroughly as invaluable technicians. There is only one field where I think there is room for our safety standards to improve. There is, if you fly in a helicopter, five times the risk compared with normal flying. That has come from the Civil Aviation Authority's own document. Helicopters are still developing. I think they have a great future, particularly in Scotland. As the helicopter becomes cheaper I hope we shall be able to operate without miles and miles of concrete and the removal from agriculture of valuable land.

I particularly want to say a word about the North Sea and the Isles of Scilly/Lands End regular helicopter services. We have a long way to go in helicopter safety development regarding flotation gear and being able to escape into boats. We very often read about a helicopter disaster, and we hear that people were unable to get into the rafts for various reasons which I will not develop. Over water emergency landing is a very dangerous proceeding, and new regulations and orders are needed to match the development which is possible today.

British Airways maintain in their North Sea services an absolutely admirable standard so far as knowledge goes today—and it will go further in the future. But that standard is not mandatory at the moment; there are other operators who feel that the equipment required, which will undoubtedly mitigate against the profitability of services, is just a frill, a surplus which is not required. Until the Civil Aviation Authority lays down—and I hope they will do it very soon—firm regulations regarding helicopter safety, we run risks which we should not accept.

I want to say one more word about Civil Aviation airports. Some European airports—I am not talking about British Airports—are worse than others. They are what I call "grey" airports which operate only in the daytime, only in controlled hours, and only in terms of laid down minima. They are the airports where there are needed the kind of restrictions with which our airlines comply. When I hear passengers grousing at British aircraft landing later than some rival airline that has come from the same place, I rejoice at their cursing because it is a sign that we have standards, to which we are keeping, which other people, I regret to say, do not have.

Some countries have wonderful and fine radio systems for guiding aircraft into their airports; others do not. We have read recently that in Europe—I shall not mention the airlines in question—there is no satisfactory radar at a particular airport. It is to be installed next year; but the promise of radar next year is a menace in operating today. There is a risk to safety which would not exist if it had full radar today.

One more point on radar concerns the lack of standardisation. Your Lordships will be surprised to hear of this example of two airports in different countries in Europe. I shall call them airport A and airport B. The governments of the countries in which these airports are situated have spent enormous sums of money putting in the latest air-to-ground safety measures. Unfortunately, each airport has a different system and they can communicate with each other only by telephone. That is the measure of the failure to obtain standardisation of equipment.

I hope that I have not dwelt too long on this question of safety, but as regards situations such as airport A being unable to talk to airport B except by telephone, as Euclid said, this is "absurd" and must be put right. Let us remember that ground control is an integral part of air safety. I finish as I started: in air travel safety is all.

4.52 p.m.

Lord Boyd-Carpenter

My Lords, the civil aviation industry, as well as your Lordships' House, is very much indebted to my noble friend Lord Peyton of Yeovil for both introducing the subject of this Motion and, if he will allow me to remark, the most admirable speech with which he did so. One of your Lordships—I am not sure whether it was not my noble friend—observed that the timing was odd. I think that the timing is just right. It is one of the strong merits of your Lordships' House that, on any subject one can think of. it is able to stage a debate in which there take part Members of the House who have very great practical experience of the subject under discussion. It is particularly useful, therefore, that your Lordships should debate subjects, including this one, not so much at a time when Government policy has been formed and formulated, but at a time when it is in course of formation.

I think it is a fact—and I have some reason for believing this—that, more than is often admitted or known, debates in your Lordship's House influence the development of policy through Ministers themselves and their advisers, and through the media, in the direction your Lordships like. Surely this is just the time when the wisdom of your Lordship's House, its knowledge and expertise on this subject, can most usefully be mobilised; the time, frankly, when the Government are considering the whole issue and have not yet come to any decision. This was exemplified by the extremely interesting speech to which we have just listened from my noble friend Lord Balfour of Inchrye. As your Lordships know, my noble friend is one of the pioneers of aviation. Not only is he a former Minister of Aviation; he also has the distinction, of which your Lordships may not be aware, that when he was Under-Secretary of State for Air he was the only member of the Air Council, including the air marshalls, who could actually fly an aeroplane. That kind of distinction and practical knowledge came out in his speech.

As regards civil aviation policy, we are at a time when policies are being reassessed. We are, as my noble friend Lord Trefgarne will recall, back in 1969 and the Edwards Report and those discussions. There are two reasons for this. One is the forthcoming denationalisation of British Airways. Like my noble friend Lord Peyton of Yeovil, I prefer the word "denationalisation" to the hideous word "privatisation". Whatever view one takes of that, obviously it affects the situation. The other new factor is the breakthrough at long last being achieved as a result of the efforts of many people, including many Members of your Lordships' House, on the subject of international air fares, particularly in Europe. We are, therefore, at a very relevant moment, when it is right that the Government, with such assistance as your Lordships can give them, should formulate policy as to what should be done for the next 10 or 15 years, or so.

Let us take the first of the new factors: the forthcoming denationalisation. There are people who say—and most of your Lordships will have received documents arguing this—that if one simply denationalises British Airways and otherwise leaves things as they are, all that one will do is substitute a private monopoly for a public one. Therefore, those persons argue, one should transfer some routes from British Airways to the present private sector. I see very great difficulties in that kind of approach. British Airways has made itself enormously more efficient than it was a year or two ago. This is due to two reasons: the dynamic leadership which they now have from my noble friend Lord King of Wartnaby, and the stimulus of forthcoming denationalisation. It has shed the over-manning which undoubtedly was the subject of the reproach which many people directed at it in years past. It is highly efficient. It is doing extremely well. Its staff have responded to the very fine leadership which they now have. It would be a very grave step indeed to oblige it to undertake further redundancies by enforced transfer of some of its routes to other airlines.

That does not conclude the issue. It would be foolish to pretend that it did. I am inclined to think that a solution is to be found in respect of future routes through the licensing procedures of the Civil Aviation Authority. Some of your Lordships may recall that in 1972 the then newly created authority was given the guidance—a technical word which always sounds to me (there is no right reverend Prelate here) somewhat theological in its formulation—that it should, in any appropriate case, give preference to the development of British Caledonian. It may be, when we come to the final decisions, that that 1972 precedent, in one form or another, may well seem worth repeating. I emphatically share the view expressed by the noble Baroness, Lady Burton of Coventry, that one would be foolish to express any final view on this issue until we have the report and the advice of the Civil Aviation Authority. I say that with due respect to my noble friend and his department. After all, there is there the greatest knowledge of the needs and problems of British civil aviation. My own view is that it would be foolish to try to lay down any very definite rule or idea until we had the advantage of their report.

They are extremely well led at present. In their chairman. Mr. Dent, we have a very wise and skilful man, and they have the advantage of the head of their economic and licensing department of Mr. Ray Colegate who, I think my noble friend will agree, knows more about the problems of route licensing than any living man in the world today. I have been very much inclined to await their views before coming to any final view myself. I would counsel your Lordships that there may be something in that.

However, there are one or two further thoughts that I should like to leave with your Lordships', for the Government's consideration and perhaps for the authority's consideration. The problem—and it is a real one—of one very large. privately-owned airline confronting a number of smaller ones is accentuated by the advantage which British Airways undoubtedly enjoys from being, so far as British airlines are concerned, virtually the monopoly operator out of Heathrow. Heathrow has more international aircraft movements than any other airport in the world. Therefore it is an enormous advantage to operate into it because you attract what is technically called the interlining traffic. It undoubtedly gives to British Airways a very great advantage. If other British operators are to be given a chance also to operate out of Heathrow without handicapping British Airways in their operations two things need to happen. First of all I think that the 275,000 movements a year rule has to go. It was formulated years ago when aircraft noise was quite different from that emitted by modern aircraft. An arbitrary figure applied to our principal airport must involve us in some loss—not least in diversion of traffic—not to Gatwick or Stansted but to Schiphol or to de Gaulle. Therefore I hope that the problem will be eased by doing away with the 275,000 rule.

I am as conscious as anybody of the problems of aircraft noise. I was deluged for five years with protests about it. However, the fact is that Heathrow Airport has been there for longer than most of the houses that surround it. It is equally true that a very large number of those who live near the airport live there for the very good reason that they earn a very good living at the airport.

Another proposal I suggest to the Government to help other British Airlines to have room to get into Heathrow, would be to carry out the decision taken by another Government quite a number of years ago to transfer all services to the Iberian Peninsular—both British and foreign—to Gatwick. That was a decision of the Government of the day some eight years ago. It was never carried out, largely because Iberia and TAP, the Spanish and Portuguese Airlines respectively, protested loudly and the Government of the day, in my view very weakly, gave way to them. I suggest this project be revived. However, I should point out that if any civil aviation in the world is not particularly entitled to any particular consideration from us it is that of Spain, which still to this day interferes with access to our own airport at Gibraltar, and whose own traffic control arrangements are—and I use the language of moderation—subject to some criticism. So may I make that suggestion.

As regards Gatwick, I hope it will continue to develop. I must declare an interest because some 30 years ago I was the Minister of Transport and Civil Aviation who took the decision to go ahead with the Gatwick development. I share fully the views of the noble Baroness, Lady Burton of Coventry, that Gatwick requires a second runway, which was included in the original plans and was very weakly abandoned by the then board of the British Airports Authority some years ago.

The other day, I asked my noble friend Lord Trefgarne, a question: given that as a matter of Government policy Gatwick is to be developed to take up to 25 million passengers a year, was there any airport in the world today which had that number of passengers with fewer than two runways? My noble friend said that there was none. It is really quite clear that the Government must face one or two things. Either—which I would regret enormously—abandoning the decision to go on with the further development of Gatwick, or grasp the nettle and go ahead with the building of a second runway there. I fully agree with the noble Baroness that the development of the taxi-way, though it may be a palliative, is no answer. As she said, it cannot take fully laden aircraft either on landing or take off; it cannot he operated while the other runway is in use because it is too near to it. I hope—the sooner the better—that a decision will be taken to build the second runway. I say to my noble friend that the longer this decision—which will have to be taken one day—is delayed. the more expensive it will be at the end of the day.

May I say one final word, which is addressed as much to British Airways—particularly in their new guise—as to my noble friend. I hope that British Airways are going to make more use of Concorde. This marvellous aircraft has proved itself in service. It has been a very great success over the North Atlantic, and I am very glad indeed that its schedule is being extended to include Miami. Some years ago it operated through Bahrain to Singapore, jointly on the last leg with Singapore Airlines. I used the service on a number of occasions. Although I was told at the time that it was unprofitable, I found the aircraft full whenever I used it. I have a personal interest in that, as chairman of the Civil Aviation Authority, I negotiated a further leg for Concorde through from Singapore to Melbourne where the Australians—particularly those who have to come regularly to London—enormously welcomed the idea.

I think this all went wrong because of the rise in oil prices. However, now that oil prices have in a way been caught up with by general changes in prices, I hope that the board of British Airways, under their very enterprising and effective leadership, will have another look at this matter and see whether the immense saving of time for busy and responsible people which Concorde can give on the route, not only to Singapore but through to Australia, can be revived.

Looking further ahead—and this is perhaps a matter for the Government because of the expenditures involved—is the time not approaching when there should be planning of new and larger supersonic aircraft? It cannot be a law of nature that civil air transport stops at 600 miles per hour whereas military transport, as your Lordships know, sometimes goes up to 3,000 or more miles an hour. The technical problems are enormous. The Americans have had very great difficulty with it. However, a joint effort between Boeing, Aerospatiale and British Aerospace might well take us over the next step to a larger Concorde with at least the same speed but with a greater range and carrying capacity. May I leave that thought with your Lordships?

Finally, may I say that I am very happy that this debate is being wound up by my noble friend Lord Trefgarne. As some of your Lordships know, his experience in this matter goes back years before he went into government. When I first met him he was in a highly responsible position in an airline at Gatwick. He knows this subject perhaps better than any of your Lordships. Although I appreciate that he is constrained by his departmental responsibilities, I know that he takes a lively interest in the subject; and he has one very great advantage which has been briefly referred to this evening. It is that civil aviation is back departmentally where it was 30 years ago and where it always ought to have been—in the Department of Transport—and is no longer overlaid by the manifold and sometimes conflicting responsibilities of the Department of Trade.

With a Minister who knows his stuff on the subject and with a department which is the appropriate one, at a time when we are all agreed that policies must be reviewed, I suggest that this is the moment for bold and progressive action in due course by the Government. If your Lordships in this debate are able to help them in that respect, my noble friend Lord Peyton of Yeovil will have been particularly justified.

5.11 p.m.

Lord Energlyn

My Lords, the pioneers of air transport are now seeing their visions come true. They had the vision to see that, as Britain was once the ruler of the waves, she has now become one of the major rulers in the skies; and this island has now become the focal point of air transport for the world. That, it seems to me, is the signpost to the future.

In the immediate post-war era I had the singular pleasure and privilege of meeting up with Frank Whittle, Andre Houberechts and Lord Hives. These were great visionaries and they were really the pioneers visualising the approach of the jet era. We are therefore extremely grateful to the noble Lord, Lord Peyton of Yeovil, for giving us the opportunity of expressing our several points of view regarding the future of this very important aspect of our industrial life.

I am not competent to judge one way or another which commercial option is the best for our industry as a whole. On the other hand, I have always taken a deep interest in the location of airports and their relationship to commercial patterns. Therefore I am very concerned about the Government's attitude to the future of the British Airports Authority. Here we have a success story without parallel among our nationalised enterprises. This is due, I suggest, in no small measure to the dedication, foresight and skill of its pioneer chairman, Mr. Norman Payne—a man who has probably been responsible for the construction of more airports than any other single person in the world. It gives me great pleasure, although I do not know him personally, to render this token of praise for his chairmanship of this remarkable authority.

If I may quote him from the Airport News No. 152, he states: I am aware that the possible privatisation of the BAA continues to be of real concern to our staff". That indicates that the man is deeply concerned with the future of the personnel of the BAA. He then goes on to say: the Board's position on privatisation is unchanged. We regard the policy as a matter for Government but remain committed to the principle of retaining the authority as a single unit". Norman Payne and his board have for me demonstrated in their publications that fragmentation would make a less attractive proposition for potential investors. It would saddle the Government and the taxpayer with smaller, and usually loss-making, airports. It would erode the Government's ability to balance traffic distribution among airports through international agreements. It would lead to higher landing charges; and, with little doubt, fragmentation would lead to a deterioration in the high standards of safety which the noble Lord, Lord Balfour, stressed are so important in aviation. These standards in no small measure have been created by the BAA. It would, I think, be wise for the Government to heed the considered opinions of the BAA, guided by such a famous pioneer as its chairman.

There is little doubt that commercial aviation is already playing a significant role in our industrial recovery. This is evidenced by the steady increase in air freight. The value added products of countries can be moved more efficiently and often less expensively by air. It is now possible, for example, to consider the movement of 2,000 tonnes of processed cobalt out of Zambia. This is a payload of metal which is now fetching between £20,000 and £30,000 a tonne. This is a very interesting payload, which is vital to Zambia's economy. With air freight it can be taken out of the country unembarrassed by what is happening in the unstable countries surrounding it.

There are other cargoes which are equally glamorous, but it is important to realise that there is an enormous growth in the transport of chemicals, biochemicals and mundane things like fruit, and so on, which emphasises the growing importance of cargo freight in the aircraft industry. Therefore, certain arrangements will inevitably have to be made in the construction of airports to accommodate the growth in the future of cargo transport. Authorities like the BAA are to me the only ones which could cope with such a form of development which is so vital for the future of our aviation industry.

These are just the few remarks that I should like to make, because I feel rather strongly that it is quite senseless to destroy something that has been unquestionably successful. Therefore, I plead with the Government to retain the BAA in its present condition.

5.17 p.m.

Baroness Gardner of Parkes

My Lords, I, too, should like to thank the noble Lord, Lord Peyton of Yeovil, for bringing this subject for debate today. I listened to the contributions of the other noble Lords and the noble Baroness, Lady Burton, with great interest. My comments will be on the airports and on the need for greater co-operation and liaison among the various bodies directly involved for the benefit of what I consider is the essential ingredient in all this—the passenger.

Heathrow has the highest passenger movement in the world and at the moment is handling just under 27 million passengers a year. The capacity is 30 million a year, and when the fourth terminal is opened in October 1985 it will rise to 38 million a year. We are all now wondering whether there will be a fifth terminal—and I know that those on the flight path very much oppose that; whether it will be at Stansted—and I agree with the point that, if you have had two inquiries, it seems rather hard to be up to the third: or whether we shall have that other runway at Gatwick. Gatwick of course is handling just under 12 million passengers a year.

I can really speak personally only on Heathrow and Gatwick. as those are the two airports that I use a great deal—and I do a lot of travelling. But being Australian, I am also constantly welcoming friends and family from that country down under. Therefore. I get a lot of indirect comments on the airports, as well as my own direct experience.

There are a number of problems. Luggage handling is a major problem both in the time that it takes to get one's luggage and in the damage that is done to luggage at Heathrow. I am sorry to say that it has a very bad reputation for damage to baggage. I remember recently having my own suitcase quite smashed to pieces, and while I was there claiming from the airline the woman next to me was in great distress because she had bought a beautiful marble piece. She had put it on the plane at the Germany end and had been told that they would carry it personally on to the plane for her. Of course, no one told her that when it got to the London end it would just be put on the conveyer belt. As it crashed off it in the middle, it smashed into two pieces. I would say that it was almost irreplaceable.

They were very helpful about my suitcase. They said, "You can either take everything out and leave your suitcase now and be paid instantly for it"—I do not know what they imagined one would do with the contents of a huge suitcase—"or you can bring it into the airline office any day next week and have the compensation". I chose that. When I went there I said to the girl, "What suitcase would you advise me to get so that I wouldn't have this trouble again?" She said, "It makes no difference. Every suitcase, every make, comes into this office for a claim. I have seen them all." There is a case for Heathrow, in particular. to look into some better method of handling the baggage so that we do not develop a bad name in that respect.

When one speaks to the British Airports Authority, they say to one. "The airlines handle the baggage: it is not the airport authority". I accept that. It was interesting that in the report of the British Airports Authority—because I was asking about complaints—there was a little statement which said: Although non-British Airports Authority complaints which can be identified are excluded"— there is a graph about what the complaints are— the performance of airlines, customs and immigration authorities and others, over which BAA has no direct control, contributes to the overall impression of an airport and is reflected in the level of complaints". I think this is absolutely so.

Having dealt with the luggage, I should like to go on to the immigration situation. I am quite sure that Members of your Lordships' House have little problem, because they all fly through with their UK passports. But if one is queued up on another passport, there can be very long delays. In terminal 3 on a Saturday morning it can take two hours to get through the other passport section. That is not a very good introduction for people coming from the United States on a jumbo jet.

Airports are run by transport authorities. If there is a tidal flow on roads and all the traffic is going one way, more lanes are converted over. In the same way, why cannot more of these immigration authorities be converted over to wherever the flow of the public is coming through? One man could remain on the United Kingdom job and the rest could move over to wherever the pile of people are arriving.

When, eventually, I got to the man, I said to him, "This seems terrible; is it often like this?" He said, "Oh, no. it's only at the week-ends". I said, "Really? Can't you do anything about it?" He said, "Oh, yes; these people shouldn't be coming here". I found that an amazing answer. Surely we are welcoming travellers who are meant to be coming armed with loads of cash to spend on goodies here in Britain, and on no account is the solution to discourage them from arriving. That is bad for the airlines, the airport, and our whole economy. There should be more liaison with the Home Office, who apparently are the people responsible for those immigration officers.

When the British Airports Authority say that the airlines handle one's luggage they do not realise (or did not remark on the fact) that the passengers also handle their luggage. Perhaps they handle it even more than do the airlines. It is a quite major effort to collect it, put it on a trolley and eventually wheel if off to wherever one is going. I always wondered how I got the one trolley with the defective wheel, but as this has happened to me so often I have decided that maybe they all have a defective wheel. Recently I was rather pleased to note that I got a new trolley with marvellous wheels. It worked just as well as any on the continent, and I can only think and hope that this means we are gradually having a replacement of those rather antiquated and not very effective trolleys.

Then one wheels one's trolley, and if one chooses to go by the airbus, fine; all is well. I have the greatest admiration for the airbus service and I think it has been a great success. Of course, it is difficult if one wants to use it to go to the airport at a time when there is very heavy traffic; one can be delayed. This is where, on the days of heavy traffic, the Tube is the answer. But the Tube at Heathrow is cleverly designed to prevent one from ever being able to get off it anywhere with luggage.

As a member of the Greater London Council, I drove the Tube to Heathrow in that first opening week. We got out there, we were shown all over, and we asked lots of questions about it. They had a marvellous indicator that one pressed and it told one just what station to go to. I said, "Does it tell you which stations you can get off at easily, where there is a lift?" They said, "Oh, no, it doesn't tell you that, but, on the other hand, this isn't designed for people with baggage". I said. "Why isn't it?" They said, "Oh, well, people shouldn't have baggage". Again, I was amazed by this. I said, "Really, if you are travelling the whole world you must have baggage". They said, "Oh, well, those people shouldn't be using the Tube".

This is unrealistic. It is important that this great capital should have a very good service and a way whereby one can conveniently collect one's baggage and take oneself to the Underground. I must say again that I was pleased to have a meeting a couple of weeks ago with London Transport. They told me that this point is now realised, although I cannot think how many years it is since that first meeting. This point is now realised and they are giving thought to introducing just a small number of stations, round the centre of London, where passengers would be able to get off, and then taxis could be available there. All of this integration of transport is very important to get one's patients—I mean passengers; I say "patients" as a dentist: it becomes a habit—comfortably in and out of London.

There is also a need—I would emphasise this—for the continuance of the porter service. There are still an amazing number of people willing and able to pay for a porter. At Gatwick in particular, the porter has access to a lift and can take one's baggage right down to the platform. He usually meets one at the platform, with one's bag, and there is no problem. When one arrives at Gatwick an announcement is made at the station saying that this service exists and it comes to one's plane. Again, that is very good.

I must voice a little complaint about the duty-free shops. The noble Baroness, Lady Burton, described KLM as being a challenge. So is Schiphol. That is the best duty-free shopping in the world. I know many people who go to the trouble of routing their flights via Schiphol, simply to be able to go to the duty-free shopping there; whereas every woman in London could tell one that the perfume at Heathrow can be bought cheaper locally, at some sort of discount place. That really is not good enough. People do not like to be taken for a ride and charged as much at the airport, in a duty-free shop, as they would be anywhere else. I know that those duty-free shops are let out on tender. I do not know exactly how that works, but it is in the interests of the airports to allow people to make a fair profit but not to make the prices totally unrealistic. The spirits and other things are not such a problem.

Having told your Lordships the grim side of the story, I should like to tell you that complaints at Heathrow are down by 24 per cent. in the last year. That is good news, and surely must indicate that things are getting better. I would say also, particularly after mentioning the transport difficulties, that the one marvellous way to be transported is in a wheelchair. The airports look after marvellously anyone who is in a wheelchair. Someone said to me the other day, "If only you could get yourself a wheelchair on some sort of false grounds, you could carry all your baggage on your lap, and all your problems are solved". But I am not suggesting that solution. They look after disabled passengers in a marvellous way.

I should like to place on record that at Gatwick there have been awards from the British Tourist Association and the building for the disabled national award scheme for the construction and improvements that have been made for disabled people. I know how much Members of your Lordships' House appreciate that, as do the disabled people who are using these facilities.

Our airports have many things that could be improved by co-ordination of these various systems, but there is a lot of good there and a lot of improvements have taken place in the recent past. I look forward to greater improvements in the future.

5.30 p.m.

Lord Auckland

My Lords, I should like to join in the tributes paid to my noble friend Lord Peyton of Yeovil for enabling us to discuss a most important subject. Airports are always a matter of top interest. One of the worries at present is the verbal or written battle taking place between the chairmen of two of our major airlines which has to some extent clouded the issue as to what really matters about our airports.

I do not fly from Heathrow as nearly as much as some of your Lordships. But one only has to go to Heathrow to wonder how on earth it sometimes operates at all. Yet generally speaking my own experience of Heathrow has been impressive. I should like to say a few words about Terminal 4 which is at present under construction, because a few months ago I was invited to visit the construction site. I should like to pay a very sincere tribute to all those responsible for the construction of the terminal and particularly for the baggage handling arrangements. My noble friend Lady Gardner of Parkes has given hair-raising examples of what can happen to luggage. I believe that the existence of Terminal 4 may well obviate some of those difficulties—one certainly hopes so. I believe, too, that the Customs arrangements at Terminal 4 will be an improvement.

My noble friend also mentioned immigration. I do not have as great a Commonwealth background as my noble friend Lady Gardner of Parkes, but I meet quite a number of New Zealanders and I find that there is some criticism of the way in which the immigration procedure is carried out. However, I am bound to say that in America it is even worse. I remember, two years ago, flying on business to San Francisco. On the aircraft one fills in the normal immigration form, plus a visa form. Yet when one goes through immigration one can be subjected to the most extraordinary questions. I realise that America, like most countries, wants to deal as thoroughly as it possibly can with illegal or undesirable immigrants. But our immigration procedures are probably more humane and above all more tactful than those of our American counterparts. I was informed by the American Embassy a few years ago that they would like to see the visa system altered considerably because it does lead to a great deal of ill-feeling and misunderstanding.

I should like to say a word about air fares in Europe. I travel from time to time to Scandinavia. The economy flight from London to Helsinki is, I believe, £481 return. I accept that one can fly Apex at just under £200, but as I understand it that involves a stay of at least 14 days. If one is going on business to Scandinavia—as beautiful a country as it is—one cannot always afford either the time or even the money to spend 14 days there. With our increasing trade and links with Scandinavia I believe that everything possible should be done to improve the situation. Mention has been made of the Government's partial success. at any rate, in getting something done about these air fares, particularly with the co-operation of the Dutch authorities. I am not blaming the Scandinavian authorities, because I was told the other day by a very long-standing Finnish friend of mine: "Ah, yes; it may cost you a lot of money to fly from London to Helsinki, but it costs me even more to fly from Helsinki to London". I am not a sufficient expert on finance or aircraft matters to see the logic of that. But it is certainly something which, within the ambit of this debate, needs looking into.

Having mentioned Terminal 4 and the magnificent work which is being done there, we must remember that there is of course the great problem of whether there should be a fifth terminal at Heathrow, development at Stansted, or a new runway at Gatwick. I would not presume to give any kind of practical, technical answer. I would only say that, not living very far from Gatwick, and Crawley New Town having recently been built, I believe that a second runway at Gatwick would cause appalling problems both as regards noise and land disturbance.

Stansted has been the subject of two inquiries, one of which took place under the very skilful chairmanship of the noble and learned Lord, Lord Roskill. Weather conditions at Stansted—and I have relatives living nearby—are often very difficult not only because of frost, but also fog. As for Heathrow, I submit that we must first construct Terminal 4. It is hoped to be completed by October next year and I understand that the timetable is well up to the mark. Of those options, there will probably be a new terminal at Heathrow despite the problems of the link roads into Heathrow. One only has to travel—as I sometimes do—from Leatherhead to Heathrow to know that can happen if the access tunnel becomes blocked or something like that. If we add more terminals then the approach roads into Heathrow must cause added problems.

Finally, I should like to pay a very sincere tribute to all those who operate Heathrow. We may criticise it—I sometimes criticise it and I am sure we all do—but as I understand it Heathrow was originally intended to be a temporary airport. Now it is one of the world's leading airports, and on the whole the standards that exist there magnify its status.

5.39 p.m.

The Earl of Lindsey and Abingdon

My Lords, having listened to all the speeches this afternoon I feel that I am following noble Lords with far more experience on the subject before us now. I am grateful to my noble friend Lord Peyton of Yeovil for initiating this debate and would echo his remark that this is only a forerunner to future debates on civil aviation policy in view of the forthcoming privatisation of British Airways.

Together with a small delegation from your Lordships' House, led by my noble friend Lord Kimberley, I visited Heathrow at the invitation of the board of British Airways at the beginning of April this year. In view of the hospitality and information that was given to us on that occasion, I felt that it was only right that a member of that delegation should take part in the debate today.

It is my intention to restrict my remarks to those points which were raised in the course of our visit and in subsequent correspondence. I would just add that I am a reasonably frequent traveller on the London to Glasgow route, and I should like to say how much I appreciate the transformation of the service between those two major United Kingdom destinations. Working, as I do, in a service industry, I am only too aware of the fact that competition leads to better efficiency and service, and that a single monopoly is not the answer. I, for one, welcome the friendly independents.

The present strategy of the board of British Airways was designed to make the airline more competitive and responsive to the market. This has begun to show results and is reflected in the latest set of accounts. I think that the noble Lord, Lord King, and his highly qualified board of directors should be congratulated on this achievement.

I now turn to the points that were put to me on the visit which I and my noble friends made to Heathrow in April. The first point worth stressing concerns the write-off of debts. It was emphasised that there is absolutely no question of write-offs. British Airways' borrowings are from commercial sources and will be repaid, together with the interest, on the due dates. Secondly, the real competition comes from the foreign carriers. British Airways has to compete with 200 international overseas airlines and at any time of the day, week or month of all the passengers travelling throughout the globe, the number sitting in British Airways seats accounts for only 2.3 per cent. of the total. This emphasises the point that charges of monopoly are quite ridiculous.

Thirdly, back in 1979—and again the noble Lord, Lord Peyton. mentioned this—the then right honourable John Nott, moving the Civil Aviation Bill in another place (which was enacted the following year), set out the Government's policy view when he said that the Government had no intention of changing or breaking up British Airways. It would be denationalised, or privatised, as it stood, in full, since the airline was in an increasingly competitive situation. I should like to ask my noble friend on the Front Bench, when he winds up this debate, to reiterate that statement.

The fourth point, which is often overlooked, is that aviation is a very fully regulated industry and there is, of course, absolutely no suggestion of the Civil Aviation Authority being abolished. Therefore, the chances that a privately-owned British Airways could behave in a predatory or immoral manner totally ignores the fact of continuing governmental regulation through the CAA.

The last major point is that significant removals from British Airways would destroy any privatisation prospects. Statements have been made in the press and on the media that the independent airlines will try to take this opportunity of the privatisation of British Airways to move in on its profitable routes. I, for one, believe in open competition, but by that I mean competition and not a form of private monopoly where one airline tries to move in and remove the routes of another.

I do not wish to become involved in the airports debate this afternoon. I have listened with great interest to noble Lords who have spoken on the question of airports. I, for one, have never been a supporter of a concentration of international airports in the South-East of England. At the time of the Roskill Inquiry into Stansted Airport I did make a speech in your Lordships' House stressing this point of view. I await with great interest the third report, which will shortly be to hand. I have always advocated the expanson of international provincial airports, such as Manchester and Birmingham. in view of the increased efficiency and better road and rail services connecting London with those centres.

5.45 p.m.

Lord Carmichael of Kelvingrove

My Lords, I think that everyone will agree that this has been a most worthwhile debate. As everyone has said, we should all be grateful to the noble Lord, Lord Peyton, for introducing the debate and most of all for the extremely open way in which he put the very important questions, and even after this debate we shall all be wondering where the answers lie. In his speech and in subsequent statements the Secretary of State has made it clear that a great deal of information is required before he and the Government can finally decide on a policy with which we shall have to live for a very long time and which will be extremely expensive. Whatever decision is made, it will be one of mammoth expense and is not one that can suddenly be changed. Therefore very grave decisions will be taken.

I feel rather inadequate speaking in such a debate, because we have listened to a great deal of expertise. My main claim to knowing something, if anything, about this is that for the past 20 years I have been making a return journey to Glasgow once a week. One would need to be extremely dull not to have picked up some of the airport information from the people one meets and from one's own experiences. I began travelling in the glorious days of the Vanguard aircraft, when service was service, and perhaps it is an indication of just how greatly the whole industry has expanded that that service is now impracticable. However, in saying that, I must say that British Caledonian (and later British Midland Airways) have done a very good job. I agree with a certain amount of interface competition. I do not think that we should ever bow to the idea that the most important thing is to be served breakfast on an aeroplane, important as it frequently is.

Throughout the time that I have flown the biggest innovation has been the introduction of the shuttle. I have waited many weary hours at Heathrow or Glasgow airports because there has been a technical fault on a plane or something else has gone wrong. In such cases one would not necessarily get a seat on the next plane available because that may have been fully hooked by people who legitimately expected to travel on it. So one could wait for three planes before getting a seat. With the shuttle one is assured of a seat.

The noble Lord, Lord Peyton, made another very important point. We all realise that when we arrive at Heathrow, Glasgow or any other airport, we are not in the town itself. You are only there when the rest of the communication system is built to match the good service that we get from the airways. To be at Heathrow airport with a bad connection to London, or no connection, is no help. Therefore, it was relevant of the noble Lord to speak in terms of the importance of helicopters, inter-airport connections, and rail and road connections. They are all part of the one travel pattern. I am sure that the Minister and the Government will he aware of this and will look at it when they are planning airports.

There is the question of helicopters. It was the most experienced of all of us. the noble Lord, Lord Balfour of Inchrye, who stressed something that perhaps we have all taken too much for granted over the years, and that is the safety factor. It is important that someone of his vast experience calls us back occasionally to show that a lot of work goes into keeping a plane in the air and making sure that safety is of paramount importance.

There were many knowledgeable and informative speeches, and speeches made from experience, in the debate today. The Minister is awaiting all these reports—and I do not blame him for that—and if he has not the time to go through all the debate I am sure that his staff will provide him with a summary of the important points so that he will be able to see how your Lordships' House is treating this subject, and be able to gather from this debate, and the debate last Friday in another place, the general mood and feeling of people towards the whole question of the airways and airports.

My noble friend Lord Underhill stressed that following the Edwards Report the right honourable Peter Shore. who I think was Minister of Trade at the time, said in the other place that we wished to have at least two carriers with the British flag in the airlines of the world. We should pay a considerable tribute to Sir Adam Thomson for the undoubted balance as well as verve that he has brought to his particular airline. One feels that one is dealing with a responsible airline when on British Caledonian. It has been built up brick upon brick with a great deal of feeling of responsibility.

Perhaps noble Lords will forgive me if I bring us back to the fact that we are discussing—and I hope I shall not be too parochial about it—airports in the United Kingdom, and make some reference to something that I thought would have been more in evidence in the debate today, which is the question of airports and the position in Scotland. We have a position in Scotland which is perhaps analogous to that of the South-East in that we have two regional airports in the central belt of Scotland as well as having the recognised—one hopes, recognised—international airport at Prestwick. Had we had the benefit of hindsight no doubt we would have thought seriously of building a central Scottish airport, just as it might have been possible to build down on the Thames the big terminal that was talked about some years ago—that would perhaps have solved all the problems of the South-East, if we had been willing to spend vast sums of money on the inter-connections and intrastructure required.

In the Scottish situation it would be better had we a central Scottish airport, which unfortunately we do not have. It is important to look at the position of the airports that we have. If it is possible, I should like the Minister to give us an indication of how he sees the position of Prestwick airport, particularly following the difficulties of British Midland which wished to fly a transatlantic service from Glasgow airport and the Civil Aviation Authority, supported by the Minister, decided that it had to fly from Prestwick.

I think this is relevant to the general discussion today because it could greatly affect the attitude towards Heathrow, Stansted, and Gatwick. Prestwick was an old airport. historically pre-war. It was built up during the war. It was an emergency airport and had an emergency runway which was almost always fog free and had a good record, and many transatlantic flights were sent there. It appears with the new avionics that we have that it may not be quite as necessary to have this standby airport, but it would be helpful if the Minister could say something about this.

A great deal is involved for Scottish aviation. A large number of high-grade jobs are at Prestwick airport. The Canadian and American charter flights still use it, and we hope to build that up. I believe that British Caledonian have one of their major overhaul places there. It is also a trading airport. Therefore, we hope that Prestwick airport will be an airport that the Government will see as important.

As one may imagine we are worried in Scotland at the idea of privatisation if it were to be done on any other basis than a major acceptance of the fact that British Airways is the best major flag carrier for Britain. not the only one, but that it maintains a high profile as the British flag carrier. We worry about total denationalisation or privatisation, because the Highlands of Scotland, which have benefited enormously from the advent of aircraft and the benefits that flow from them, have the feeling that despite the great successes of the Highlands Division of British Airways it may be a candidate for being reduced, or even cut, by any group of people purely concerned about the profitability of the business.

Although it is paying now and the Highlands Division are confident of the future, nevertheless communities like the Highlands of Scotland are worried because the airline is vital not just as a natural means of communication but in giving the feeling of ability to move quickly if it is required. It takes away the feeling of isolation that some communities have. If there is ever to be a real future for some of these areas the airways must be maintained. There is an understandable worry that there could be an effect on the Highlands Division of British Airways as a result of privatisation.

I agree with the Secretary of State when he says that when an airline, or any organisation, is subsidised there should be clarity of where the subsidy is coming from. I do not think that we in Scotland are in doubt at all that we want to know if we are subsidised and how far we are subsidised. But it is easier if it is part of a total network, part of a total concept of a world airline, if part of it is being subsidised because it perhaps indirectly helps the major services of the airline itself as a result of the interconnection that is possible.

I hope that the Minister will be able to give us a little understanding about whether he fully accepts, following the debate we have had today, the statement by the Secretary of State that there should be three airports in the South. Whatever happens to the whole of the airport network, I hope that these three airports will stay as a unit.

A great deal has been said about the second runway at Gatwick. I am not fully competent to discuss that, but looking at the large number of figures we have been given I do not think there is any way of avoiding the fact that at some point Stansted has to be considered as another airport to take a major role in civil aviation in Britain for the next 10 or 15 years.

I get worried when I think of Heathrow with the 275,000 airport traffic movements per year. I suppose that. if there is a great improvement in avionics, it will possibly be able to take some more. I was glad that the Secretary of State said that at least for the present he was convinced that the 275,000 movements was the correct figure and, because he was holding to that figure, he was willing to alter it only after having an investigation made of all its aspects. When one divides up 275,000 flights a year it seems an incredible figure for people such as the air traffic controllers and others to handle.

I look forward to the four reports we shall be receiving. I shall read the debate in greater detail than I was able to absorb from the speeches today. I hope that having had this debate, for which we are grateful to the noble Lord, Lord Peyton of Yeovil, and after we have received these reports, and long before any final decisions are taken, this House and another place—where a great deal of expertise has been shown by honourable and noble Members—will be given plenty of opportunity for discussion before legislation is contemplated.

As to the article that was in the Financial Times on Wednesday, 2nd May, which I am sure the Minister has read, the final sentence is still pertinent after all we have heard and after all the reading we have done. The article says: The really hard questions in the arena of airline competition await a solution". That is still the case and because of the momentous solutions that are required I hope that as much time as possible will be given to them. This is not a method of trying to delay privatisation; it is merely that because of the importance of decisions for the future of the British airline industry, and because of the nature of the distribution of the airports, a decision has to be taken with a great deal of understanding and input from the whole community. I and many others ask that this House and another place be given plenty of time to discuss the issue before we reach a final decision.

6.4 p.m.

Lord Trefgarne

My Lords, I must begin by echoing those noble Lords who have thanked my noble friend Lord Peyton of Yeovil for introducing this debate this afternoon. As a number of noble Lords have pointed out, the United Kingdom civil aviation industry is a key part of our national economy. Our major airlines produce annual operating revenues in excess of £3,000 million. They employ over 60,000 employees, in addition to all the indirect employment at airports, and so on; and there is the revenue earned from all these associated activities. There is also the important contribution made by the smaller air taxi firms and all the other general aviation operators.

In turning to the various points which have been made this afternoon, I will start with the privatisation of British Airways, which is a thread which runs through many of the other considerations of policy about which we have heard today. Six months after my noble friend Lord Lucas repeated a Statement to your Lordships about the privatisation (or denationalisation, if my noble friend prefers) of British Airways, I can report that on 1st April this year British Airways ceased to trade as a statutory corporation and began trading as a public limited company, with share capital of about £180 million wholly owned by the Government. The preparations for privatisation (with apologies to my noble friend) are continuing with the appointment of brokers and other advisers to assist the Government.

Let me recite again the benefits of privatisation. In British Airways' case they are, firstly, to inject private sector equity capital into the airline and expose it to the disciplines of the market place; secondly, to let the management run the business free from Government involvement in its daily affairs—in the decision about what aircraft to purchase or the amounts it may borrow or repay—and, thirdly, to reap a substantial sum for the taxpayer. We intend to achieve these aims and to privatise the country's largest airline in a way which is consistent with the sound development of the United Kingdom's aviation industry.

British Airways has shown determination and flexibility in recovering from a difficult period for civil aviation throughout the world in the first two years of this decade. BA is now building itself a reputation both for profitability and for service. My noble friend Lord King of Wartnaby and his staff have good reason to be proud of their achievement in reviving the fortunes of British Airways. Incidentally, my noble friend Lord King has asked me to say that he would have very much liked to have made his maiden speech today, but he felt that, on reflection, he would not have been able to do so uncontroversially, and therefore feels that he should choose another occasion on which to address your Lordships for the first time. I should personally like to congratulate my noble friend on the airlines' results for 1983-84 and for exceeding, by a wide margin, the Government's financial target for 1982-83 and 1983-84, producing an average real rate of return of 10.4 per cent. compared with a target of 5.75 per cent. Provided that BA keeps up these successes—and I am confident that it can—the company should be ready for flotation by early 1985.

However, the prospect of a privatised British Airways has aroused some fears about the competition which it will present to other parts of the industry after that event, and several noble Lords have echoed those fears during this debate.

Some airlines have suggested that unless the structure of the industry is substantially changed, British Airways will enjoy such a dominant position that they may be forced out of business. We recognise that these fears are genuinely held. It was for this reason that last December my right honourable friend the Secretary of State for Transport asked the Civil Aviation Authority to review the implications of privatising British Airways for competition and the sound development of the industry. Since then the CAA has received over 100 submissions about the need for change. and in April it published an interim assessment putting forward some interesting ideas for further comment. The authority is on course to provide a report of its conclusions by the middle of next month.

I cannot today comment on the interim assessment or speculate on what conclusions the CAA may reach. To do so might conceivably prejudice the eventual outcome of the review. But I can assure your Lordships that any policy changes arising out of the review will be decided well in advance of British Airways' privatisation. This review, although a major element, is not the only part of the evolutionary change taking place in the framework which governs British civil aviation. Since 1979 this Government have sought to liberalise the regime within which airlines must operate.

As long ago as 1980 my right honourable friend Sir John Nott ended British Airways' monopoly of the service between London and Hong Kong. This was a decision which I announced to your Lordships at the time. I recall that, although my noble friend Lord Boyd-Carpenter expressed reservation, the decision was generally welcomed. I believe that the experience of British Airways, British Caledonian, and Cathay Pacific on the route, and the increase in total traffic generated. fully justified my right honourable friend's courageous decision.

Since then there has been a number of important licensing decisions designed to foster competition and your Lordships will need no reminding, for example, of the effect on British Airways' performance of licensing a second carrier on some of the domestic trunk routes out of Heathrow. The civil air transport industry exists to meet the needs of its customers, but without an adequate level of competition it cannot expect to flourish or. in the long term, to maintain in employment the many thousands who depend upon British air transport for their living. The dead hand of over-regulation is the one sure way of guaranteeing a moribund industry that fails to give the customers what they want.

Turning to Europe, we have all benefited from the freedom of trade within the Community. Manufacturers have benefited from the wider markets in which they can sell their goods without import restrictions and tariffs. Consumers have benefited from a wider choice of competitively priced domestic goods. Competition has increased efficiently and kept down prices during a period of inflation: but it is very disappointing that, 25 years after the Treaty of Rome came into effect, so little progress has been made in establishing the freedom of services envisaged under its auspices. It is particularly disappointing that virtually no progress has been made in civil aviation and that scheduled air services remain subject to virtually the same restrictive bilateral regimes as 20 years ago.

The travelling public is suffering from lack of competition which creates unnecessarily high prices and airlines are denied the opportunity of increasing their markets through imaginative, innovative and competitive fares. The travelling public has benefited enormously wherever restrictions on civil aviation have been relaxed and fare competition encouraged. We believe that similar results would flow from a relaxation of restrictions on scheduled services within Europe. At present, some bilateral agreements prevent more than one airline from each country serving a route and require them to mount approximately equal capacity. This was in the mind of the noble Lord, Lord Underhill, when he spoke.

There is no incentive to compete under such a regime and it is small wonder that the airlines concerned negotiate revenue-sharing pool agreements. We should like to see governments free to authorise as many of their own airlines as they thought fit to serve routes to other European countries. We should like to see those airlines free to decide what planes to use and what frequencies to mount on the routes: and we should like to see them free to fix fares on commercial grounds without any need to consult other airlines involved and to charge those fares. subject only to the approval of the government of the country of origin of the traffic. In order to ensure that there was fair competition between European airlines, we should like the Commission to enforce the rules in the treaty about state aid. Action on these lines would, I believe, create the competitive environment which is needed if scheduled air services are to be able to meet the demands of the travelling public and, indeed, to create new demands from people who do not at present travel by air. I am confident that competition would make all European airlines more efficient and that British airlines would give a good account of themselves in such conditions.

Her Majesty's Government welcome the Commission's recent proposals for progress in this field, even though they do not go nearly as far as we should like. We are glad that the Council agreed to set up a high-level working group to consider liberalisation of air transport and to report to Ministers by the end of the year. I hope that this will lead to the speedy adoption of a liberal regime in Europe. My noble friend Lord Gainford asked me about this matter at Question Time yesterday. In the meantime. my right honourable friend the Secretary of State has already announced that, in accordance with what we believe to be the requirements of the Treaty of Rome. he will no longer require airlines to consult their competitors before filing tariffs for the British Government's approval.

Last week my right honourable friend reached an agreement with his colleagues in the Netherlands which will very significantly liberalise our bilateral civil aviation relations. Not only will the Dutch follow us in not requiring airlines to consult before filing tariffs, but any airline designated by either Government will be free to fly on any route between this country and the Netherlands at whatever frequency and capacity they wish and, subject only to the approval of the country of the origin of traffic, will be free to charge the fares which the airline considers appropriate. It is true, as the noble Baroness, Lady Burton, has said, that KLM will be free to match the tariffs quoted by British Airways between London and any overseas point; but, by the same token, British Airways and British Caledonian will be able to match KLM's tariffs on the routes from Amsterdam and British airlines will benefit from this arrangement because of the large network of international routes which they operate from London.

Baroness Burton of Coventry

My Lords, if Imay say so, I never mentioned the word "tariffs". I merely asked whether it was true that KLM would have the right to fly to any airport in the United Kingdom that they did not already serve and would be able to take passengers from there through Amsterdam to their other routes. I never mentioned the word "tariffs".

Lord Trefgarne

My Lords, the answer to the noble Baroness is, yes, they will: but then British carriers will have reciprocal rights through the Netherlands. I think the advantage will be at least as much in the British favour as it may be—

Lord Peyton of Yeovil

My Lords, I wonder whether my noble friend has taken the opinion of the airlines as to whether or not British airlines, as a result, will enjoy an advantage comparable with that gained by KLM. I believe very much the contrary.

Lord Trefgarne

My Lords, of course, I attach the greatest weight to the views of my noble friend but, as my other noble friend Lord Boyd-Carpenter was kind enough to say during his remarks, I did at one time have some responsibility for matters of this kind with one of the smaller British airlines and I can tell your Lordships that that airline is one of those which, I understand, will be involved in these arrangements; and I am certain that they will find them very much to their favour. I understand that British airlines are broadly pleased with what has been agreed.

My Lords, we hope to negotiate more liberal bilateral relations with the other member states, so that our airlines, and those of our European partners, may have greater freedom to compete for the business available and to increase the total amount of air travel in Europe. I believe that over the past few months there has been a change in attitude towards liberalisation in many countries. The travelling public complains about high fares and the present restrictive system. The more forward-looking airlines—and I am glad that several of them are British—are anxious for freedom to compete and share the benefits of efficiency with a growing travelling public. Governments themselves are accepting the need for change. We must take advantage of the opportunity and press for a rapid relaxation of unnecessary restrictions. The resulting freedom to compete will reflect credit on the governments concerned, present a challenge to their airlines and, above all, bring benefits to the travelling public.

I now turn to the Government's proposal to introduce private capital into the British Airports Authority, which we announced last year. The authority's seven airports handle the vast majority of all international scheduled air traffic in Great Britain. They are not, however, all profitable, though the authority has made considerable progress, particularly in Scotland, where the Scottish airports are expected to break even as a group this year. Heathrow is very profitable, being the world's largest international airport. It accounts for most of the authority's profits. But Gatwick Airport is growing very fast and is now the fourth largest international airport in the world, though it is still less than half the size of Heathrow.

These airports together form a major national asset. The route networks available to the airlines operating from them should ensure that they maintain their present international dominance. However, by the end of this decade these two airports will not have sufficient capacity to meet the expected demand and the additional capacity needed. At the Government's invitation, the authority have applied for planning consent to provide this at Stansted. We are awaiting the inspector's report on the public inquiry into this and the alternative application to develop a fifth terminal at Heathrow. Decisions on these planning applications and the other proposals considered at the inquiry will be taken by my right honourable friends the Secretaries of State for Environment and for Transport some time after that and, therefore, it would not be appropriate for me to comment at this stage on any of the cases made in the inquiry.

The authority's board have proposed that the seven BAA airports should be sold together. But a number of other views have been advanced. Some have suggested that each airport should become a public limited company which could be sold; others that groups should be kept in common ownership.

My right honourable friend, after examining carefully the prospects for creating competition between the three London airports, has concluded that, for the foreseeable future, effective competition could not exist. Heathrow is the dominant airport by virtue of its very considerble international network of air services, and demand is always likely to exceed supply. The airport is already close to its capacity and it may not be possible to price away the demand. Charges at Gatwick are considerably lower than at Heathrow, but it has required a prohibition on charters and scheduled services by new operators at Heathrow to promote its development.

For the future, further measures to distribute traffic between the London airports will be needed, given the constraints on charging and the expected growth in air transport. This will also be necessary in order to enforce the limit on air transport movements which will come into effect at Heathrow when Terminal 4 opens next year. My right honourable friend the Secretary of State for Transport will shortly be issuing a consultation document inviting views on how that might best be done. It is vital that the London airports be developed in an orderly way if demand is to be met. The Government are necessarily involved in such matters, and the London airports could not be free to compete for traffic even if they were in separate ownership. The noble Baroness, Lady Burton, asked me when that document will be published. I do not have a precise date; I believe it will be fairly soon but I can tell her that I have at least already seen a draft.

These considerations have led us to conclude that the three London airports should not be sold separately. We have however taken no other decisions about the introduction of private capital into these airports or into the BAA's Scottish airports. The form in which these airports can be presented to the market will depend on the outcome of the review of Scottish lowlands airports policy which was announced recently and which is intended to show whether the present licensing policy is still appropriate. We do not expect to make any decision on privatisation until this and a number of other important issues affecting airports are resolved. I hope that that allays the fears in the mind of the noble Lord, Lord Carmichael.

Government policy is to encourage the use of regional airports—a matter in the minds of several noble Lords. This policy not only provides the most convenient services for passengers, but helps to take some of the pressure off south-eastern airports. The policy has been matched by action. In the past five years unprecedentedly large capital allocations have been made for specific airport projects of national or regional importance. But I should emphasise that the Government's policy is one of encouragement and facilitation. It is no part of the policy to force people to travel from the south-east to the regions to catch a flight. And it is for the commercial decision of the airlines whether they should operate a service from a regional airport: the Government cannot direct them.

It is also Government policy, inherited (I am happy to admit) from the previous Administration, that airports should not in general be subsidised by the taxpayer or the ratepayer. We believe that airports should be operated in a fully commercial manner. I recognise that some of the airports do take a commercial approach, but I think that more can yet be done. We think that the introduction of private capital into local authority airports would be beneficial, and we hope that local authorities will themselves see the advantages for management of involving private capital voluntarily—we do not propose to compel them to. If they converted their airports into company form, it would bring the advantages which go with it, would make it easier to introduce private capital, and for those airports owned jointly by local authorities allow some flexibility of ownership.

We are also considering ways in which the Scottish aerodromes in the Highlands and Islands, inherited by the Civil Aviation Authority when it was set up, could be transferred from the Authority to other owners, and continue to meet the needs of the communities they serve more economically than at present.

My Lords, I have spoken about some of the major issues which have been discussed in our debate today. Besides those, your Lordships have touched on other matters on which I should like to say a word or two. My noble friends Lord Peyton and Lord Balfour and others referred to the CAA review of helicopter airworthiness which was published on Wednesday, 20th June. This is a comprehensive review which requires the most careful study; but it is already clear that it will make a major contribution to future helicopter design as well as point to improvements in existing helicopters which would lead to an enhanced level of safety.

References in the report to the superior fatal accident record of fixed wing aircraft in comparison with helicopters must be kept in perspective. The fact remains that the United Kingdom public transport helicopter record is acknowledged to have been very good. Adoption of the short-term recommendations concerning existing aircraft will require close cooperation between the CAA as the regulatory body and manufacturers, operators and bodies such as the oil companies who are the main sponsors of helicopter operations. The report also emphasises the need for close international co-operation with European and American government agencies if the long-term design improvements are to be achieved.

May I now turn to some of the other points that have been made during our debate this evening. The noble Baroness, Lady Burton, my noble friend Lord Boyd-Carpenter and one or two other noble Lords referred to the question of a second runway at Gatwick. The Government have made it clear—I am sorry to sound repetitive to the noble Baroness—that we do not intend to pursue the possibility of a second runway at Gatwick. We remain of the view that with the trend to larger aircraft a single runway will be able to handle 25 million passengers a year—the estimated capacity at Gatwick's two terminals by the mid-1990s. The Government agree that there is need for additional runway capacity in the London area. However, they took the view that for a number of reasons the development at Stansted to which I referred a moment ago is to be preferred to the construction of a second runway at Gatwick.

The noble Baroness and I think my noble friend Lord Boyd-Carpenter also mentioned the question of the parallel taxiway. The parallel taxiway at Gatwick when upgraded will not be able to handle take-offs of fully laden wide-bodied aircraft because of its length. It will be available to handle the majority of movements at Gatwick when the main runway is out of action for some reason—for example, an accident, scheduled maintenance or some other problem. Upgrading will therefore bring substantial benefits, minimising diversions and so saving airlines additional operating costs and saving passengers considerable inconvenience. I am sure that the BAA will have assessed these benefits against costs before deciding to proceed with this contract. The noble Baroness. Lady Burton, referred to the expense to the taxpayer of upgrading this taxiway. Of course the BAA has its own funds for this purpose so there is no particular charge on the taxpayer. As I said in my earlier remarks and as I think the noble Lord, Lord Underhill, said, too, Gatwick has recently risen above Charles de Gaulle airport in Paris in terms of the number of passengers that it carries. It is interesting to reflect that Gatwick has only one runway but Charles de Gaulle airport has at least two and conceivably three. It may not be that the number of runways is quite as critical as some noble Lords have suggested. My noble friend Lord Peyton asked me about the helicopter link between Heathrow and Gatwick. I am not sure that he was entirely fair to my right honourable friend to suggest that no reason has been given for not allowing the licence for a further 10 years. The reason has been given; it is because of the environmental effects of the helicopter service that he saw no justification for it to continue once a highspeed coach service is introduced when the M.25 is completed. I can tell my noble friend that I had some responsibility for these matters in the then Department of Trade and complaints about the noise from that helicopter service were a very considerable part of my duties. I am therefore well aware of the pressures that were on my right honourable friend to reach the decision that he did.

My noble friend Lord Balfour made some telling points about the safety of aircraft operations, with which I wholeheartedly agree. On the question of radar at particular airports, I think it ought to be remembered that the introduction of radar at many airports (and I am not thinking particularly of precision approach radar, which is not something to be found very frequently in civil aviation these days, but area radar in particular) is not generally provided to lower the weather minima of aircraft operations, but rather to increase the intensity at which the airport can be used. The introduction of radar at any particular airport therefore serves to increase the capacity of the aerodrome but not necessarily the safety level. What happens is that when there is no radar the aircraft have to operate a more ponderous procedure, if I can call it that, which naturally takes more time and therefore does not allow the same number of movements to be achieved at any particular time.

My noble friend Lady Gardner, in an important and interesting speech, made a number of detailed points which I will certainly make sure are brought to the attention of those who are responsible for them. But perhaps I could add, in echoing what another noble friend has said, that on a number of occasions I have found myself at the end of a very long queue when entering the United States because I do not hold an American passport. I am sorry, therefore, that my noble friend has been inconvenienced on one or two occasions on that account.

My noble friend Lord Auckland paid a tribute to those involved in the construction of Terminal 4, and I should like to echo what he said. He asked why it cost more to fly from Helsinki to London than the other way about. I do not have the reasons in my head, but I can make inquiries and write to my noble friend.

As I said at the beginning, our policy on civil aviation extends over a very wide compass—

Lord Boyd-Carpenter

My Lords, if my noble friend is passing from specific points, I wonder whether he is able to say a word on the point that I put to him about the possibility of reviving the decision (which was not implemented) of a previous Government to transfer all British and foreign services to the Iberian Peninsular to Gatwick.

Lord Trefgarne

My Lords, the question of controlling the number of movements at Heathrow, which I think lies at the very heart of what my noble friend is saying, will be the subject of the consultative document which is to be published very shortly, and to which the noble Baroness, Lady Burton, referred. Perhaps I could ask my noble friend to study that document when it is published, as I am sure he will, and then to put forward his ideas at that time. Those are certainly ideas of the kind we shall want to consider in order to deal with the problems we shall be facing.

As I said at the beginning, our policy on civil aviation extends over a very wide compass, and a great deal of that compass has been explored by what your Lordships have said today. I must say that I have found it informative and instructive to hear the variety of views expressed—not always in agreement with each other—and I can assure your Lordships that the Government will take very careful note of the views which have been put forward when it comes to taking decisions upon these important questions.

6.34 p.m.

Lord Peyton of Yeovil

My Lords, I should first like to thank those of your Lordships who have taken part in this debate for the interesting and eloquent speeches which have been made. There have been three main veins running through the debate. First, there has been an understanding and characteristic generosity by your Lordships' House concerning the Government's inability to say very much on a wide range of topics now being covered by reviews, inquiries and the rest. At the same time, there has been an expression of hope. My noble friend Lord Boyd-Carpenter was characteristically generous enough to express confidence that Ministers would actually read, mark, learn and inwardly digest what has been said in your Lordships' House. Though I would be the first to thank my noble friend on the Front Bench for his very comprehensive speech, I should at the same time like to express the hope that he will advise his right honourable friend the Secretary of State, and the Parliamentary Secretary, to read some of the things that have been said today, and even to attend to them.

There has also been an assumption that when the Government feel freer to speak, are nearer to decisions and have the material available on which those decisions should be based, there should be, and will be, further debates. I hope those responsible for arranging the business of the House will take note of that, particularly as it has been an assumption which has been made and echoed on all sides of your Lordships' House.

A further constant current through the debate has been a note of praise and appreciation of the success of the efforts of my noble friend Lord King. I should like very much to endorse that most warmly. My noble friend Lady Gardner of Parkes, if I may say so, deserves a special mention and also the gratitude of your Lordships' House. She produced one of those pearls of bumbledom which occur from time to time and which, if I may detain your Lordships for a moment, I will take the liberty to repeat: People using the Tube should not have luggage or, if they do, they should not be using the Tube". I think we are all most grateful to my noble friend.

I have frequently wondered what would happen if any of your Lordships moving such a Motion as I have moved today were not to withdraw it; but since I share the fear that was expressed by the noble Baroness, Lady Burton of Coventry, of being further deluged with paper, I ask leave now to withdraw my Motion for Papers.

Motion for Papers, by leave, withdrawn.