National Air Traffic Services (Hansard, 29 November 2000)

§ Mrs. Dunwoody
To ask the Secretary of State for the Environment, Transport and the Regions if foreign bidders for NATS will be asked to guarantee reciprocal access to their home markets for air traffic. [140695]

§ Mr. Mullin
No. That would be impossible to procure. It is intended that the Strategic Partnership Agreement and other documentation will contain provisions which will, in appropriate circumstances, commit the Strategic Partner and members of its consortium to using NATS as the vehicle for expansion, either abroad or in the UK.

§ Mrs. Dunwoody
To ask the Secretary of State for the Environment, Transport and the Regions if he will list the cost so far of the proposed privatisation of NATS to(a) the CAA, (b) NATS and (c) the Government. [140696]
612W

§ Mr. Mullin
The costs incurred by the Government so far in connection with the PPP, including those associated with splitting NATS from the CAA, are approximately £12.3 million. The Government have also paid approximately £10.6 million to NATS and £1.6 million to the CAA in respect of the costs that those two organisations have incurred in connection with the PPP. All of these figures include VAT.

§ Mrs. Dunwoody
To ask the Secretary of State for the Environment, Transport and the Regions what talks he has held with NATS about the continuation of safe air traffic control if the Economic Regulation Group proposals for cuts are implemented. [140693]

§ Mrs. Dunwoody
To ask the Secretary of State for the Environment, Transport and the Regions what response the Government have made to the CAA about the cuts in costs and investment recommended by the Economic Regulation Group and their effect on safety. [140692]

§ Mr. Mullin
My right hon. and noble Friend the Minister for Transport has regular meetings with the Chairman of National Air Traffic Services at which charge control and other issues are discussed. The most recent of these was on 13 November.
The Government have received advice from the Civil Aviation Authority as to the charge control conditions for NATS. We are considering the advice alongside the views of NATS and the projections of bidders as the sale process continues, and will announce our decisions on the charge cap shortly. My officials have had a meeting with the CAA's Director of Safety Regulation, who confirmed that he was satisfied that safety would not be jeopardised by the charge cap proposed by the Economic Regulation Group.
The Government are very conscious of the need to ensure that the charge cap does not risk compromising either safety or the investment programme. An undertaking was given to the House by my hon. Friend the Minister for Housing and Planning on 15 November 2000, Official Report, column 998, that on no account will we set the cap at a level that will create operational difficulty for NATS, or that will raise the slightest question of a risk to safety.

§ Mrs. Dunwoody
To ask the Secretary of State for the Environment, Transport and the Regions what will be the cost to the CAA Pension Scheme as a result of the separation of NATS from the CAA; what compensation will be paid; and by whom. [140697]

§ Mr. Mullin
These are matters for discussion with the Trustees of the Civil Aviation Authority Pension Scheme (CAAPS), which have yet to be concluded.

§ Mrs. Dunwoody
To ask the Secretary of State for the Environment, Transport and the Regions if he will specify the controls that are in place in the National Air Traffic Services Strategic Partnership Agreement and the licence for the private finance arrangements to ensure safety is the paramount consideration of any partnership agreement. [140688]

§ Mr. Mullin
Neither the Strategic Partnership Agreement nor the operating licence is a primary safety tool. The Strategic Partnership Agreement governs the relationship between the Strategic Partner and the Government. It requires the Strategic Partner to appoint a safety director to the board of NATS and provides for the 613W formation and maintenance of a safety committee. The operating licence is an economic instrument which establishes the rules under which NATS will operate as a regulated monopoly. In setting the initial charge control under condition 21 of the licence, the Government will ensure that the charge cap does not risk compromising either safety or the investment programme.
The safety regime, with its associated licensing and approvals requirements, is established under the Civil Aviation Act 1982 and the Air Navigation (No. 2) Order 1995. Furthermore, clauses 1 and 2 of the Transport Bill secure that safety is the CAA's and the Government's first consideration in exercising their functions under the Bill.

§ Mrs. Dunwoody
To ask the Secretary of State for the Environment, Transport and the Regions if he will place in the Library the terms of the National Air Traffic Services Strategic Partnership Agreement before the choice of a strategic partner is finalised. [140687]

§ Mr. Mullin
The Strategic Partnership Agreement will be a joint venture agreement between the Government and their Strategic Partner. As such the document will contain a large amount of commercially sensitive information and data which will govern the running of the company. Therefore, publication of the full document could undermine NATS' commercial position with its competitors as the company looks to expand in the future.