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NEWS Last modified on November 11, 2014

APD and capacity expansion hotly debated at AOA conference

The negative impact of UK air passenger duty (APD) and whether Gatwick or Heathrow should be expanded were the central issues debated at yesterday’s Airport Operators Association (AOA) annual conference.

Delegates gathered at the Hilton Metropole in London, where this year's theme was ‘Sustainable Airports for a Stronger Economy’ which was moderated by BBC presenter John Humphrys.

Among the attendees were Robert Goodwill MP, aviation minister for the Department of Transport, UK airport bosses and other key industry players.

Before the first session, Goodwill gave a keynote address where he explained the importance of aviation to the UK economy, emphasising the need for capacity of airports to be developed in the South East.

He told delegates the Airports Commission’s investigations will end the “shilly-shallying” over airport expansion in the UK, and vowed to sort out the capacity “problem”.

Goodwill also admitted the expansion debate will be an issue at the UK General Election in May, but in his view it should not be.

As for the Conservative Party and their previous manifesto commitment to not build a third runway at Heathrow, he would not explain the new stance, simply saying a new manifesto will be revealed soon that will detail the party’s view.

He added: “The conclusions of the Airports Commission (due after the election) will form the basis with what we make a decision on.”

His address was followed by the heads of the three shortlisted options, discussing why their proposals should be given the go ahead by the UK government.

Gatwick CEO Stewart Wingate, Heathrow CEO John Holland-Kaye, and Heathrow Hub director Jock Lowe, traded blows over which proposal was best for the UK, pressing their cases to be chosen.

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Highlights of the discussion included Lowe explaining that in his opinion “regional airports would in principle suffer without the expansion of Heathrow”.

Holland-Kaye meanwhile said that Heathrow must be chosen essentially for economic reasons, and it would be the “Premiership” option as opposed to the “Championship” option of Gatwick.

He also explained Air China would like to make Heathrow it's biggest base in Europe, but are restricted by capacity, so has chosen other European hubs such as Frankfurt and Paris CDG.

Gatwick CEO Wingate told delegates his gateway is the only chosen that is politcally deliverable, and he sees airport noise footprint as a “key issue” in the debate over where a new runway should be built.

Labour shadow aviation minister, Gordon Marsden, then gave an address over the importance of capacity expansion, and in his opinion the government should prioritise improving surface access to UK airports.

Session two entitled Sustainable Airports saw industry key players debate what is being done and can be done to reduce carbon emission in the industry.

AOA chief executive, Darren Caplan, hailed the work being carried across the industry in the UK, and says it should be applauded for cutting emissions, as detailed in the recent AOA sustainability report.

The day’s final session saw a lively discussion between senior airport figures, and industry players, with much of it focusing on the controversial UK air passenger duty (APD).

Edinburgh Airport chief executive, Gordon Dewar, called for the powers of APD to be devolved to Scotland, to help stimulate passenger numbers, and he says the Scottish Government has vowed to scrap it or reduce it.

edinEdinburgh Airport

“It is a great opportunity to lead the way with APD, and it would increase passenger numbers by two million to Scotland,” he explained, and he added airlines do not put on flights because of it.

TUI Aviation COO, Chris Browne, says APD is a “punitive” tax, and questioned why the UK pays so much more than their European neighbours and competitors, while all agreed more needed to be done to reduce APD and it was unfair as other industries do not face such taxes.

Questions were then asked from the floor if Scotland was to gain autonomy of APD, whether it would harm Newcastle Airport and other northern UK gateways.

Paul Kehoe, chief executive of Birmingham Airport, said in his view passengers would use Edinburgh instead of Newcastle, but Dewar says his gateway is in competition with Barcelona and Vienna and not Newcastle, so sees no reason why it will affect the regional airport.

Earlier in the day in his conference opening keynote address, AOA chairman Ed Anderson, also explained that the AOA is calling on the government to scrap ADP for children on UK flights, and for more action on it to help boost the industry.

The conference finished this afternoon, where the first address of the day was by Airports Commission chairman Sir Howard Davies, while other speakers included Virgin Atlantic chief executive, Craig Keeger, and Dubai Airports chief executive, Paul Griffiths.

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