How the UK’s new government will impact aviation
In the name of environmental friendliness, the UK’s newly formed Conservative-Liberal Democrat coalition government has already outlined some policy changes affecting aviation – and the news is not necessarily welcome.
It is clear now that plans for a third runway at Heathrow Airport will be scrapped. The Conservative Party were very vocal on this debate during their time in opposition, and fiercely critical of the previous government’s airport expansion plans. I hope their case is built on solid business and environmental foundations – rather than just being an attempt to win the popular vote while in opposition. Will improved internal high-speed rail links prove sufficient; or will those fearful voices from the business community prove correct that this decision will ultimately be a constraint on economic growth? Remember, Heathrow is already running at 98 per cent capacity!
British Airways (BA) issued a dejected statement that it "remains of the view that a third runway at our national hub airport, Heathrow, would have very substantial economic benefits for the whole of the United Kingdom. The incoming government is well aware of our view but has taken a different position". The UK could now lose out to Spain, where BA – through its merger with Iberia – should be able to grow instead.
A second major policy shift will be in the reforming of the Air Passenger Duty, currently a tax on a per passenger basis, to a tax on a per aircraft basis. This move will benefit airlines which fly with the highest load factors. The coalition government hopes that the tax will encourage carbon efficient behaviour and penalise airlines flying half-empty aircraft. Some airlines though, such as British Airways (they really aren’t having a good time at the moment, are they?), remain concerned that the tax will not go directly towards funding environmental or infrastructure benefits, and that any so-called “green tax” is unnecessary in light of the European Union’s emission trading scheme. BA stated: "Emissions trading leads directly to reduced emissions. Taxes do not.”
