European and External Relations Committee, 26 Oct 2004

Meeting date: Tuesday, October 26, 2004

Official Report 251KB pdf

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Low-cost Airlines (European Commission Decision)

Item 2 on the agenda is the Executive's response to the report—

I am sorry to interrupt you, convener. I was delayed in getting here early this afternoon and I would like to tender Gordon Jackson's apologies—a member of his family has been taken into hospital.

I am happy to note that, thank you.

Item 2 is the Executive's response to the report on low-cost airlines and the European Commission's decision. The response, which has been circulated to members, contains the Executive's comments on the report that was produced in July by Phil Gallie on behalf of the committee.

I am happy with the response from the Minister for Transport. He seems to take a positive approach to what was said in the report, but he does not pick up on a couple of points. He refers to the importance of competition and avoiding bias against one company or another, with which I agree whole-heartedly. However, the fact is that Ryanair made a volume deal with Charleroi and any other company could have made that same deal. I would like to pick up that point with the minister.

In the past few days, another adverse issue has arisen, namely the threat to regional air services in the UK in the form of changes to air traffic control charges. The intention is to change the formula for the sums that are paid by companies. At present, operators of small planes are charged a higher rate per passenger than operators of larger planes are charged, although the operators of smaller planes probably pay less per route than do the operators of larger planes.

The UK Government has responded to the European consultation document to suggest that that formula should change. If it does, it could well have a bad effect on the new low-cost airlines that operate from Scotland, as most of them use smaller planes. There could be an adverse effect in the Western Isles in particular if charges were to change. In whatever reply we make to the minister, we could perhaps draw his attention to that new threat and ask him to comment on it.

Just for the benefit of members, is it a European proposal that the UK Government has commented on?

No, it is a European consultation paper to which the Department for Transport has responded by suggesting that current charging methods for corridor control costs should change. The Department for Transport's response seems to go against the operators of small planes on the basis that it believes that if bigger planes use those corridors, there will be fewer of them, but that does not necessarily follow.

Are there any other comments?

My comment is only indirectly relevant, but I am fed up with the phrase "low-cost airlines" when anyone who flies up and down from here to London, let alone to Brussels, knows just how expensive flights are. That pertains to the inquiry into promoting Scotland worldwide on which we have just been taking evidence, as well as to the issue of Scotland's accessibility. Often, even if you book a flight within a week of departure, you pay a fare that would get you from London to New York on a genuinely low-cost airline.

I want to come back on that because in the past if people booked a little bit ahead on Ryanair flights from Charleroi to London, they could easily pick up tickets for as little as one penny per trip. Air fares to London are regularly available at £15, with added taxes of £18. Low-fare airlines offer a genuine product. Rather than leave it to the last minute, Keith Raffan should book a bit earlier and—

That is absolute rubbish as far as Edinburgh is concerned.

We are beginning to stray from the point.

This is pertinent to our inquiry into promoting Scotland worldwide. We should ask the minister directly what action he is taking on the Edinburgh to London route and how we can lower the fares. The issue is important for the whole country.

In drawing the matter to a close, I have two points to make. First, it is implicit in the committee's conclusions that—and the minister has accepted this—in the context of our inquiry into the promotion of Scotland to the world, direct air links are fundamental to the accessibility of the Scottish marketplace. Therefore, any diminution of our existing direct air contacts and routes would be damaging to the health of the Scottish economy. All of us who have studied the issues over the years have been encouraged by the increased number of direct flights that we now have, but the situation is nowhere near perfect in terms of costs or the range of routes. Those are points that we can make in response to the minister and in the context of our inquiry.

Secondly, if there are issues that affect charging structures and which might affect the point of principle—that is, the importance of direct flight connections into Scotland and their sustainability from a cost point of view—we should draw those issues to the attention of the minister and seek his comments. That is particularly true of the points that Mr Gallie has raised. The clerks will take forward those two points as the result of our discussion.

I have a further point. The Executive's reply mentions Dundee airport being publicly owned. I am interested to know why no low-cost airlines fly out of Dundee airport. I know that they used to, but I do not think that they do now.

Without wishing to engage in a discussion about the technical attributes of Dundee airport, I suspect that it is something to do with runway length. I am sure that a visit to Dundee airport would answer those questions.

I have been there, seen it and flown from it.

Let us move on.