Stop Stansted Expansion calls for resignation of Geoff Muirhead from Airports Commission due to bias

Campaign group Stop Stansted Expansion SSE have highlighted the problem of a conflict of interest concerning Geoff Muirhead, who is a member of the government-appointed Airports Commission.  Mr Muirhead retired as chief executive of MAG in 2010,  and he represented MAG in an “ambassadorial role” until January 2013, several months after he was appointed to the Airports Commission.  MAG bought Stansted from BAA in February 2013. Earlier this month MAG published options on where to build a second runway at Stansted and potentially even expand it into a four-runway hub. SSE are calling for Mr Muirhead’s resignation.  SSE has written to Sir Howard Davies, chairman of the Commission and Patrick McLoughlin, the Secretary of State for Transport, warning it will mount a legal challenge if Mr Muirhead refuses to step down. The group claims in the letter, seen by The Sunday Telegraph, that there is an issue of “apparent bias”.  The letter (26th July) says: “In the circumstances we consider it unacceptable for Mr Muirhead to continue to serve on the Airports Commission and the longer he continues to serve, the more the process risks being tainted.” SSE will start taking legal advice within 14 days if they receive no satisfactory commitment on the matter.

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Airports Commission member faces calls for resignation

A key member of the Airports Commission, which is investigating where to build new runways in Britain, is facing calls for his resignation amid concerns over a conflict of interest.

By   (Telegraph)

27 Jul 2013

Campaign group Stop Stansted Expansion has also threatened to take legal action if Geoff Muirhead, the former chief executive of Manchester Airports Group (MAG), refuses to step down from the government-appointed commission. [More information on Mr Muirhead below ].

The campaigners have highlighted that Mr Muirhead, who retired as chief executive of MAG in 2010, continued to work for the airports group, which now owns Stansted, until earlier this year.

Mr Muirhead represented MAG in an “ambassadorial role” until January of this year, several months after he was appointed to the Airports Commission, which was set up by the Government to take an impartial look at where to build extra runways in the South East of England.

MAG bought Stansted from BAA, now Heathrow Airport Holdings, for £1.5bn in February. Earlier this month it published options on where to build a second runway at Stansted and potentially even expand it into a four-runway hub.

Stop Stansted Expansion has written to Sir Howard Davies, chairman of the Airports Commission and Patrick McLoughlin, the Secretary of State for Transport, warning it will mount a legal challenge if Mr Muirhead refuses to step down.

The group claims in the letter, seen by The Sunday Telegraph, that there is an issue of “apparent bias”.

“In the circumstances we consider it unacceptable for Mr Muirhead to continue to serve on the Airports Commission and the longer he continues to serve, the more the process risks being tainted,” the letter, dated July 26, reads.

“Mr Muirhead is bound to have significant influence within the Commission since he is its only member with first-hand knowledge and experience of the aviation industry,” the letter continues. “As its chief executive, he led MAG’s expansion policy and the construction of a second runway and terminal at Manchester Airport.

“In light of MAG’s submission to the Commission on July 19, we regard it as imperative that Mr Muirhead steps down from the Commission forthwith.

“Failing this, and in the absence of any satisfactory commitment from you within 14 days, we will take further legal advice with a view to initiating legal proceedings to challenge Mr Muirhead’s role on the commission.”

A spokesman for the Department for Transport said: “We are satisfied there is no conflict of interest. Geoff Muirhead’s expertise in airports is the very reason he was appointed.”

According to MAG’s accounts for 2010/11, the year when Mr Muirhead retired from its board, he was paid £82,000 “for consultancy services provided in his role as ambassador to the group”.

http://www.telegraph.co.uk/finance/newsbysector/transport/10206662/Airports-Commission-member-faces-calls-for-resignation.html

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More about Geoff Muirhead:

 

Geoff Muirhead

Geoff Muirhead

Manchester Airports Group chief executive Geoff Muirhead (aged 60) stepped down in  2009 after 22 years with the company, it was announced today.  He spent a total of 22 years with MAG, joining in 1988 as business development director. Mr Muirhead was promoted to CEO in 1992 and took on the role of CEO in 2001 when the group was formed.

During his time as chief executive he has overseen the construction of Manchester Airport’s Terminal Two and the 2nd runway, and the acquisitions of airports in Bournemouth, Humberside and East Midlands which have made MAG the 2nd biggest airports operator in the UK.

Mr Muirhead’s remuneration package in 2008 totalled £512,000 including a bonus for the group’s strong performance in 2007-8. He is the son of a butcher from the north east, left school at 16 with one o-level and began his working life as an apprentice draughtsman at British Steel Corporation. He was awarded a CBE in 2004 and was the CBI’s business executive of the year in 2001.  Link

He was awarded the CBE in the Queens New Year’s honours list in 2004, adding to his significant other personal achievements, which include honorary doctorates from Manchester Metropolitan University, Teesside University and the University of Salford and a former CBE Business Executive of the Year.

Additionally, Geoff holds fellowships with the Institute of Civil Engineers, Chartered Institute of Transport, Royal Society of Arts and Royal Aeronautical Society.

Geoff is also Deputy Chairman of the North West Business Leadership Team and Non-Executive Chairman of Ask Developments.  Link

He is Chairman of the Northern Economic Futures Commission which was established in July 2011 and is made up of business, academic and public sector figures,

In April 2012  link  ”Geoff Muirhead, chairman of the Northern Economic Futures Commission, said: “The North-South divide has existed for too long and it’s having a negative effect on the national economy which is desperate for growth. Our Commission is convinced that we can unlock potential for vital growth in the North of England if government creates a more level playing field.   ”So-called ‘spatially blind’ policy-making has simply favoured short-term returns in London and the South East. The North doesn’t need more hand-outs but a long-term economic strategy which recognises the differences between places and the need for more local approaches to skills, innovation and infrastructure.” ”

Geoff Muirhead is the new chair of the Atlantic Gateway board. In addition to his chairmanship of Atlantic Gateway, Geoff is also a member of the North West Regional Leaders Board, chair of the IPPR Commission reviewing the future economic prospects for the north of England, non-executive chairman of Ask Developments and a governor atManchester Metropolitan University.  link   Peel Group.

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Article about him from 2004 at http://www.guardian.co.uk/business/2004/may/15/transportintheuk

“We should provide a much better service so that people don’t have to
go to the south-east,” he says. “There’s enough in the south-east
anyway. My task is to stop people from here going down there. That
must be right in every respect – economically, and environmentally –
musn’t it?” His big bugbear is the concentration of wealth and power
in the south. Briefly the smile fades. “To say there isn’t a north-
south divide is to ignore reality,” he says. “There is an imbalance in
the economy which is dangerous. If we continue the way we are, we
should just all give up and live down there. That would be horrendous.
The country could not sustain that.

“Something has got to give. This preoccupation with only the south-
east as a motor is not a model that works elsewhere, even in France,
which is more centralised than we are but where there is major
activity outside Paris. And look at Germany and its prosperous
regions. The UK needs more prosperous regions and cities and policy
needs to be very much changed to recognise that.”

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The terms of reference and membership of the Commission were announced in November 2012

Airports Commission under Sir Howard Davies. Membership and terms of reference announced.

http://www.airportwatch.org.uk/?p=3497

2.11.2012

The government has today announced the full membership and terms of reference of the Airports Commission, to be chaired by Sir Howard Davies, and to “identify and recommend to Government options for maintaining the UK’s status as a global aviation hub.” The government says it has identified individuals with a range of skills, backgrounds and experience to sit on the committee. The Commission also intends to appoint a panel of expert advisors. Members are: Sir John Armitt, former Chairman of the Olympic Delivery Authority; Professor Ricky Burdett (LSE); Vivienne Cox (was at BP Alternative Energy); Professor Dame Julia King (a member of the CCC); Geoff Muirhead CBE (former CEO of Manchester Airports Group). The terms of reference are that “The Commission will examine the scale and timing of any requirement for additional capacity to maintain the UK’s position as Europe’s most important aviation hub; and it will identify and evaluate how any need for additional capacity should be met in the short, medium and long term.”  And it “should engage openly with interested parties and members of the public,”  etcDetails about each of the Committee members below  http://www.airportwatch.org.uk/?p=3497DfT press release at:http://www.dft.gov.uk/news/statements/mcloughlin-20121102a

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SSE say, in their recent newsletter:

It is profoundly disappointing that Stansted’s new owners, the Manchester Airports Group have jumped on the bandwagon and asked for Stansted to be favourably considered either for one extra runway or as the location for the UK’s future hub airport, to replace Heathrow and be capable of handling a throughput of 160 million passengers a year.  By way of comparison, Stansted handled 17.5 million passengers last year, Heathrow 70.0 million, and the world’s busiest airport – Atlanta, USA – handled 95.5 million.

We will of course be doing everything possible over the next few months to convince the Airports Commission to reject the idea of any new runways at Stansted.  It is currently operating at only half its permitted capacity and so a second runway – never mind a four-runway hub more than double the size of Heathrow today – is completely unnecessary on business grounds and it would be completely unacceptable on environmental grounds.  Even looking 15 years down the line and beyond, there is no logical case for Stansted to be one of the short-listed options.

As we all know, however, these matters are not always determined on a logical basis.  Politics and other extraneous factors can often be more influential and, in this regard, we already have one major area of concern.  One of Sir Howard Davies’s team of five commissioners, Geoff Muirhead, is the former chief executive of Manchester Airports Group (MAG).  He is the only member of the Airports Commission with first hand knowledge and experience of the aviation industry and he spent 24 years with MAG during which time he led the Group’s expansion policy and the construction of a second runway and terminal at Manchester Airport.

As soon as we learned of Mr Muirhead’s appointment, on 2 November 2012, we raised the issue directly with him of a potential conflict of interest in the event that MAG succeeded in acquiring Stansted.  His response was that he had retired from MAG two years earlier and so there was no conflict of interest.  However, it transpired that was not the full story because he continued to be employed by MAG as an ‘ambassador’ at a salary of some £82,000 a year until January of this year, i.e. he was simultaneously a member of the Airports Commission whilst representing the interests of MAG.  He also benefits from a very substantial MAG pension.

Up until now we have been pursuing this matter quietly, behind the scenes, with Sir Howard Davies and the Secretary of State for Transport.  We have written four times and we had hoped that by now Mr Muirhead would have voluntarily stood down from the Commission so as to avoid bringing into question the Commission’s independence and impartiality.  We have also taken legal advice on the matter, in the light of which we are surprised as well as disappointed that Mr Muirhead continues to serve as a member of the Airports Commission.

Now that MAG is directly lobbying the Airports Commission for major expansion at Stansted, we believe there is far too much at stake to allow the position of its former chief executive on the Airports Commission to go unchallenged.  We therefore intend to give the Secretary of State and Sir Howard Davies one last opportunity to deal with the matter, failing which we intend to mount a legal challenge.  We believe that we have a duty to the community we represent to ensure that the issues are examined – and seen to be examined – entirely impartially and independently

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