Telegraph articles pressing for more Heathrow and south east airport expansion

The Telegraph is publicising a new report by Frontier Economics, for BAA, hoping
to show that the economy is dependent on more south east airport growth, and more
routes from Heathrow to China. The articles come during the last month of the
Government Scoping Document consultation on production of new UK aviation policy.
The government has ruled out new runways in the south east, though encouraging
growth in air passengers at regional airports.  Below are two very pro-aviation-expansion
stories from the Telegraph.


18.9.2011

The aviation hole in George Osborne’s growth plan

George Osborne made a big play for growth on Friday. Speaking at The Telegraph
Festival of Business in Manchester he said that his was a Government ready to
back British business and ensure that the UK economy would soon bounce back.

There are four keys to this, the Chancellor said – a better educated workforce,
an internationally competitive tax and regulatory system, support for start-up
businesses which are then scaleable and an economy where international trade plays
a greater role. “Our ambition is for Britain to become a more balanced economy,
by encouraging more exports,” he argued.

Mr Osborne’s speech was a thoughtful and well constructed piece of work. As he
said to an audience of 650 chief executives of the UK’s version of the German
mittelstand, this stuff is in his blood.

“I know your type of company very well, I grew up with one,” the Chancellor said
to murmurs of approval.

“Over 40 years ago my father set up his own business, manufacturing and selling
home furnishings. Over the years it’s grown to employ a couple of hundred people.

“Growing up, the rhythms of the business’s life and the rhythms of my family
life were one and the same. I remember the ups and downs.

“The new orders won. The new collections launched. The excitement when the first
sales were made in America. And I know the kind of pressure that you are under.
To compete, to stay ahead and to make a profit.

“But from that pressure great things can emerge – new ideas, new products, new
jobs.”

This is where the Government should retain its focus. The Telegraph launched the Festival of Business – aimed at mid-sized companies which we see
as the bedrock of the UK’s economic prosperity – with the express purpose of listening
to this vital sector. Mr Osborne appears to understand them.

One lengthy passage in his speech was devoted to planning, a knotty issue where
the Government has pledged to cut 1,000 pages of regulation to just 50. Agree
or disagree, the Chancellor was sticking a stake in the sand and claiming the
Government wanted to do all it could to release a company’s ability to expand.
High speed rail – which John Armitt, the former chief executive of Network Rail,
said at the Festival should be built immediately to Scotland without the rather
odd, staged approach to Birmingham first and then Manchester – was a must.

It seems most peculiar then that this Government, with its pro-growth agenda
and keeness to look
overseas, has one policy that appears to be rather more concerned with looking
back to a pre-industrial age than it does with looking forward. I am speaking,
of course, of aviation.

Somewhat quietly, the Government is at present undertaking a “consultation” on
its policy. It finishes at the end of the month. In Opposition, David Cameron
painted himself into a corner when he ruled out supporting a third runway at Heathrow
– the constituencies he needed to win in south-east England meant that those worried
about the noise in their back yard trumped those concerned about our European
competitors stealing a march on us.

This week, as we reveal today, the Government’s “no expansion” aviation policy
is a serious threat to Britain’s growth trajectory. A new report by Frontier Economics commissioned by the British Airports Authority will say that the UK has 20 times more trade with those countries with which
we have a direct flight connection than those with which we do not. Paris and
Frankfurt have almost twice as many flights to the three largest cities in China
than are possible from London.  (This is contradicted by the recent report done by HACAN. See below )

The essential point is that international economies need major hub airports.
And in the UK that hub airport is Heathrow. If expansion of that site is off the
agenda – and unfortunately it appears to be – then Mayor of London Boris Johnson’s
plan for a new airport in the Thames estuary should be given serious consideration.
There are also other plans put together by former airline executives for a new
airport in Kent.

Last month the Department for Transport published its own growth forecasts for
aviation which admitted that airports in the south-east of England will be full
by 2030. Mr Johnson rightly used the occasion to demand that the Government reviews
its policy on opposing the construction of new runways.

“The central forecasts suggest that without new runways the three largest London
airports will be at capacity by 2030, and all growth beyond 2040 will occur at
regional airports,” the report said. According to the DfT, airline passenger numbers
in the UK would more than double from 210m in 2010 to 470m by 2050. Demand for
international travel from UK airports would also double.

Now, it is right that regional airports should be supported to allow for economic
growth. But the aviation minister, Theresa Villiers, needs a policy that also
supports London and the South-East, which is still the engine-room of the British
economy.

As a spokesman for Manchester airport succinctly put it: “It is not realistic
to assume that someone in Kent will come to Manchester to fly to Dubai. But it
is realistic to say that someone in Sheffield could choose Manchester to fly to
New York.” It is also not realistic to plan for a growth in direct flights to
emerging market destinations at regional airports which do not have access to
the essential hub airport traffic from around the globe.

“High-speed rail” is the answer for those who oppose runway expansion. It is
argued short-haul travel would be better undertaken by train around the UK and
to the near-Continent. That, though, is a solution which may, just, be available
by the middle of the century. The process for planning and building HS2 to Birmingham
is already mired in controversy and dispute and the completion of any link between
two cities just 100 miles apart is still decades away, if it ever, frankly, happens.

In a report two weeks ago, the Confederation of British Industry revealed the
need for action. Among manufacturers 83pc see both domestic and international
transport connections as significantly influencing their investment decisions,
the report said. Although nearly 80pc said they were satisfied with connections
to the European continent, that figure fell to below 60pc when it came to satisfaction
with links to emerging economies.

As with banking, there is only so much anti-competitive load we can pile up on
the UK growth wagon without suffering the consequences. Strategy is about having
a long-term vision. Sadly, on aviation so far we have a damagingly short-term
political fix.

http://www.telegraph.co.uk/finance/comment/kamal-ahmed/8770785/The-aviation-hole-in-George-Osbornes-growth-plan.html

 

Related Telegraph Articles   Coalition aviation policy ‘failing’  17 Sep 2011 

 

Coalition aviation policy leaves UK trade grounded, says report

The Government’s aviation policy will face a fresh attack this week when a new
report reveals that Heathrow is falling further behind its European competitors
in the battle for lucrative routes to emerging market economies.

 

The report, by Frontier Economics, will argue that hub-airports, such as Heathrow
are vital to promoting economic growth. Because of the amount of through traffic,
it means that many more flights to emerging market destinations are economically
viable.
 
 By  (Telegraph) 17.9.2011

The report commissioned by BAA, which owns Heathrow, is set to show that the
value of business trade to emerging markets with a direct flight link to the UK
is 20 times higher than to those markets where there is no link. The value of
the trade potential being threatened could run to billions of pounds.

The report, by Frontier Economics, will argue that hub-airports, such as Heathrow
are vital to promoting economic growth. Because of the amount of through traffic,
it means that many more flights to emerging market destinations are economically
viable.

It will say that the UK is losing out to Paris Charles de Gaulle and Frankfurt
airports which now offer many more direct routes to major cities in China.

The report argues that 25pc of all economic growth by 2016 will come from China
and that in the next decade half of all economic growth will come from emerging
market economies. China itself is building 97 new airports to service its fast-growing
cities.

The findings will put further pressure on David Cameron and the aviation minister,
Theresa Villiers. Before the general election, the Conservatives said they would
not support the building of new runways at Heathrow despite it being the UK’s
only leading international hub airport. The Government is at present undertaking
a review of its aviation policy and many business leaders believe that it should
reverse its decision. Although that appears unlikely as it would be politically
controversial, the London Mayor, Boris Johnson, has backed plans for a new airport
to be built in the Thames estuary.

The Heathrow report will echo findings by the Department for Transport which
said UK airports in the south-east of England will be full to capacity by 2030.
Although it says that regional airports such as Manchester could take some of
the strain, because they are not hub airports they could never replace Heathrow.

A source who has seen the report said: “Our case is that the centre of gravity
in the world economy is shifting and Britain should be forging new links with
emerging markets.

“Instead we are edging towards a future as an island cut off from some of the
world’s most important markets. If Britain is not to lose out to international
competitors, we need an aviation policy that recognises the role of a hub airport
in supporting growth.”

 
 
By contrast
 a recent report by HACAN at Heathrow
 

New report shows Heathrow has better business connectivity than any European
rivals and is “In a Class of its Own”

“In a Class of its Own”

 27.8.2011  (HACAN)

New Report:  Heathrow’s links to main business centres of the world dwarf its
European rivals

A new report reveals that Heathrow’s links to the world’s main business centres
dwarf those of its European rivals. 
International Air Connectivity for Business ,” published today by AirportWatch, shows that Heathrow has 990 departures each week to key business destinations
in Asia, Latin America, North America and Europe, more than the combined total
of its closest rivals, Charles de Gaulle, Paris and Frankfurt airports.

It also revealed that London airports combined (Heathrow, Gatwick, Stansted) 
have more than double the number of flights to key business destinations each
week compared with Paris, Frankfurt, and Amsterdam’s.

The report has been published just a day after the Government announced its response
to the recommendations of the Committee on Climate Change, where it predicted
a 2% annual growth in passenger numbers to 2050, significantly lower than the
3.7% growth seen in the past twenty years. The Government’s analysis assumes capacity
constraints on UK runways and terminals which is welcome. But their claim that
these constraints could lead to UK passengers switching to Continental airports
seems very far fetched, given the clear lead that London airports already have
over their competitors, in providing the best business connectivity.  .

AirportWatch intends to submit its new report as part of its evidence to the
Department for Transport’s Aviation Scoping Document, currently out for consultation
(consultation closes 20th October).  The Scoping Document is the first stage in
the Government’s plans to produce a new aviation policy.  In the Scoping Document
the Government stressed the importance to business of good air links from UK airports
to key business centres abroad.

AirportWatch Chair John Stewart, who compiled the report and who also chairs
HACAN, which represents residents under the Heathrow flight paths, said, “Heathrow
is in a class of its own as far as international business connectivity is concerned. 
In fact, London as a whole is better connected to the world’s business centres
than any other European city.”

Jean Leston, Acting Head of Transport at WWF, who financed the report, said,
“The Government is right to stress the importance of international air connectivity
to business.  This report shows just how well connected the UK is to the international
business community”.

The other key finding of the report is that most flying from Continental airports
is not inter-continental but short-haul within Europe, largely for leisure purposes. 
It concludes that it then becomes not a question of lack of capacity for UK airports
but how best that capacity can be used, making the most of our superior business
connectivity while capping emissions from aviation.
 
 
The report :