§ 2.58 p.m.
§ Lord KissinMy Lords, I beg leave to ask the Question standing in my name on the Order Paper.
§ The Question was as follows:
§ To ask Her Majesty's Government whether, in view of the answer given in this House on 17th 816 December 1986 to Baroness Burton of Coventry, Her Majesty's Government would welcome the unilateral initiative to cut air fares within Europe taken by two British airlines and would then regard similar initiatives by other carriers as a helpful contribution towards the implementation of European Community policy on commercial competition.
§ The Parliamentary Under-Secretary of State, Department of Transport (Lord Brabazon of Tara)My Lords, the Government strongly support efforts to introduce lower European air fares and greater competition. If the noble Lord is referring to plans by British Caledonian Airways and Air Europe for new routes in Europe, he will appreciate that I have to be a little cautious. These applications for licences are to be heard by the Civil Aviation Authority in March and, in view of my right honourable friend's appellate role in licensing matters, I cannot of course comment on these specific proposals.
§ Lord KissinMy Lords, I thank the Minister for that reply. But may I ask him to clarify why there is a delay in dealing with the pricing policies of the major European airlines? In fact, as they stand now, the pricing agreements come as near to a cartel arrangement as one can imagine. In industry and commerce, the Commission is taking very intensive action against any sort of cartel agreement. In that particular instance, we had to postpone the time period for six years.
§ Lord Brabazon of TaraMy Lords, I assure the noble Lord that, as your Lordships will be aware, the Government have been doing all they can to promote liberalisation on European flights. The reason why the Civil Aviation Authority has to consider these applications is that objections have been made to some of them. That is why a hearing is to be held in March.
§ Baroness Burton of CoventryMy Lords, can the Minister tell the House from where the objections have come?
§ Lord Brabazon of TaraYes, my Lords. On some of the routes, British Caledonian has objected to Air Europe's applications, and vice versa. Both airlines have asked for a hearing. Other airlines have also objected and wish to be heard.
§ Baroness Burton of CoventryMy Lords, will the Minister elucidate which other airlines, please?
§ Lord Brabazon of TaraMy Lords, I understand that the other airlines are British Airways and Dan Air, not necessarily in respect of all the routes, but some of them.
§ Lord UnderhillMy Lords, can the Minister give an assurance that the various answers that he has given in no way change the Government's view on bilateral or international agreements either in the Community or elsewhere? Is there any likelihood of a policy of cheaper fares being included in the prospectus for the sale of British Airways?
§ Lord Brabazon of TaraMy Lords, so far as the sale of British Airways is concerned, British Airways has always made clear that it would be much happier with a more competitive environment and would welcome any moves which make it less dependent on the requirements of competing carriers. As I said in answer to the noble Lord, Lord Kissin, we continue to press in Europe for a Europe-wide agreement and we shall, of course, continue to do so under the Belgian presidency. We should of course like to see more bilateral agreements, but it must be remembered that we already have several with the more liberal states and it is unlikely at the moment that we shall be able to achieve them with other states.