Andrew Simms: “Forget Heathrow and Gatwick expansion, the Davies report should tackle frequent flyers”
Forget Heathrow and Gatwick expansion, the Davies report should tackle frequent flyers
The Airports Commission chaired by Sir Howard Davies, former chairman of the Financial Services Authority, is set to publish its report on the next steps for aviation in Britain.
After years of consultation and industry lobbying, the commission will recommend where new airport capacity should be added. The only problem is that many feel it avoided the far more important questions: whether Britain needs any more runways at all and if a better approach would be to tackle the small numbers of very frequent flyers.
There’s an argument from some industry lobbies such as Runways UK that British business is suffering from an aviation capacity crisis. To profit from emerging markets like those in Asia, they say, more space is needed for flights in the south-east, most probably at Heathrow or Gatwick.
But, contrary to popular impressions, official figures point to the trend of a “general decline” in business flights, clearly visible in Office for National Statistics data, and acknowledged by the Airports Commission itself. Only about 11% of flights abroad are now accounted for by business travel.
What has happened, however, is a huge growth of short-haul leisure flights from Britain’s busiest airport, Heathrow, which has crowded out the potential for new business routes to emerging markets. But this aviation boom has little to do with the hyped democratisation of travel. It is benefiting a small minority and in curious ways.
Over half the UK population doesn’t fly even once a year. A very small minority flies three or more times per year, just 15% of UK residents, and that group accounts for seven out of 10 of all flights taken.
Analysis of data from the International Passenger Survey by Sean Geeling, a PhD student at the Tyndall Centre at Manchester University, reveals an even more interesting twist. The places in Britain which are home to the most frequent flyers are shown to be the City of London, the boroughs of Westminster and Kensington & Chelsea, and Surrey. He found the most common destinations these UK residents are flying to are recognised tax havens.
UK regional airports have ample, spare capacity if additional business routes are needed. If government policy better supported Britain’s regional development with business incentives, their use might also balance out Britain’s south-east-heavy economic model. Reining in the flight – literal and financial – of the super wealthy could bring additional, unexpected bonuses.
But this, of course, assumes that business needs to fly more and would benefit from doing so. There are several reasons to believe this is not the case. Aviation is hugely subsidised and compared to other economic sectors enjoys multi-billion-pound tax breaks, from its fuel to its VAT-free tickets and duty-free emporia.
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Events that followed the eruption in 2010 of Icelandic volcano Eyjafjallajökull suggests there is more pain-free wriggle room to downwardly adapt than typically acknowledged. It pumped out a cloud full of fine silica particles, which are potentially lethal to jet engines, and like flicking a switch it brought airports across Europe to a standstill. The loss of the global economy’s airborne arteries could have been a death knell for business. But, the world didn’t end and people adapted astonishingly quickly in ways that had other environmental benefits.
There was an upward spike in the use of video-conferencing facilities saving business travellers time, money and fatigue. One major provider saw bookings go up by 38% in the UK, 12% across Europe and 9% in the US. “As one business contracts, another expands,” as BT’s advert said of its video conferencing. The co-operative retailer John Lewis reported that a big effort from “local hero” producers prevented any major interruption of supplies.
What’s more, stranded people turned to each other for help. The Swedish carpool movement spread its horizons, setting up a new Facebook group called Carpool Europe to share cars and rides. Twitter came into its own with hashtags like #putmeup and #getmehome. The Eurostar train service used spare capacity to carry 50,000 additional passengers over four days who would otherwise have flown. More ferries sailed and more coaches and trains ran in the UK, particularly on routes such as London to Scotland, where it had become more commonplace to fly.
Parcel-delivery services within Europe such as FedEx and UPS shifted from planes to trucks where possible. And Norway’s then prime minister, Jens Stoltenberg, stranded in New York, used an i-Pad to keep running the Norwegian government.
With a strong economic and environmental case against expanding airport capacity, coupled with declining business demand, the argument is now being made to democratise flying and apply the polluter pays principle by introducing a frequent flyer levy.
The Airports Commission was scheduled to report after the general election for political reasons. In waiting so long they’ve fallen behind the debate and they are answering the wrong question. Instead of waving more planes into the air, they should keep more feet on the ground and work out how better to manage the skies.
Levy on frequent leisure flyers proposed to make airport expansion unnecessary
Plans for a “frequent flyer” tax to curb demand for leisure flights and make a new runway in south-east England unnecessary have been unveiled by an influential group of transport campaigners, environmentalists and tax experts. These include the Campaign for Better Transport, the New Economics Foundation, the Tax Justice Network, Greenpeace and Friends of the Earth among others. In a letter to the Observer – in order to remove the alleged “need” for a new south east runway – they put forward the concept of allowing each person one tax-free flight per year, but increasing the rate of tax for people who fly frequently. The levy would rise with each successive flight. This would mean that instead of APD (£13 per return flight to Europe) there would be a higher rate of tax for frequent fliers. Their analysis shows that 15% of the UK population take 70% of all the flights, while half of us don’t fly at all in any given year. Rather than a new runway being vital for business, the reality is that it would be used for the better off to take more leisure flights (holidays or visiting friends and family). The proposed levy would mean the number of flights would be cut to a level that would make a new runway unnecessary. The authors of the scheme have also shown that this change to the taxation of air travel would also ensure the UK could comply with its obligations under the Climate Change Act.