Beneath the caution radicalism lurks

When I was at the DfT a decade ago, the main activity late on a Friday afternoon was a call from the likes of the Sunday Times demanding comment on the latest transport controversy. This would invariable spark a search of the building for any official able to help who was unwise enough yet to have slipped across the road for a 'quick one' at the Barley Mow.

Now it seems that late Friday afternoon is a time for alerting stakeholders to the imminent launch of the government's response to the call for evidence on its future aviation strategy. Being allocated such a graveyard slot on the No 10 communications grid in itself highlights the government's desire to avoid substantive coverage and discussion of broader aviation issues ahead of the planned parliamentary vote on Heathrow expansion in June/ July.

With such a big prize at stake the government's caution is understandable, but does risk holding back progress on the much-needed strategy beyond Heathrow. This new publication sets out the DfT's current thinking ahead of a promised green paper this autumn, with a final aviation strategy due in early 2018. So for those of you who had better things to do at the weekend, here's what caught my eye from the DfT's 'next steps' document.

First, on the need to ensure sustainable growth, the document is disappointingly lightweight. With demand for aviation projected to rise significantly between now and 2050, there is a real need to plan for growth in capacity, particularly in the highly congested south east. But beyond reaffirming to a parliamentary vote on Heathrow expansion in the summer, the paper merely says the strategy will "look to address what should constitute a framework for future sustainable growth". By failing to provide stronger policy support for making best use of existing capacity, the government risks missing a trick, as airports such as Stansted and Gatwick are coming forward now with viable plans for growth in the next decade. The document does however send a strong signal that tougher measures to address noise impacts must go hand in hand with growth.

Much more interesting and forward-looking is the chapter on competitive markets. First, it raises the question of whether single dominant carriers at airports could harm consumer interests in future. With BA having 52% of flights at Heathrow, Easyjet 42% of Gatwick and Ryanair 78% of Stansted, new policy interventions here could have significant impacts. The government also commits to look at how airport slots are allocated, particularly in the context of new capacity being created (for example at Heathrow). This is an area currently subject to EU regulation, where Brexit could in principle provide welcome flexibility. In practice however, I wonder whether such flexibilities will be negotiated away as part of future trade deals, leaving the Treasury's longstanding aspiration to move to a regime of slot auctions just that. The document also commits to look at domestic connectivity within the UK. (And don't hold your breath for major changes to the 'nice little earner' that is APD).

Third, on airspace, the document again hints at significant policy evolution. Modernising the use and management of UK airspace is vital to supporting sustainable growth. It is, however, difficult to deliver at the local level as any changes inevitably generate (quiet) winners and (noisy and angry) losers. To ensure efficient co-ordination of essential airspace changes, the new strategy will consider whether government "needs to take new enforcement powers to require airports to take forward, or to hand over to NATS to take forward, particular airspace changes that are important for wider airspace modernisation". This sounds like the right solution, but places a hot potato firmly in Ministerial hands. Will it stay there is the question.

Radical thinking is also hinted at in the section on the UK Border. The UK now processes more passengers with facial recognition (through e-passport gates) than any other country. But minimising queues at a time of shrinking resources for the Border Force will require fresh thinking. The strategy will therefore "consider whether there are additional or alternative funding mechanisms in the medium term", as it says are used in other countries. Expect Border services to shift further from being taxpayer funded to a user-pays system (i.e airlines and thus passengers) over time.

Elsewhere, the chapter on surface access is for the most part so many warm words, though again the door is ajar on bold new thinking in the critical area of funding transport improvements. The strategy will "investigate the appropriate investment risk sharing and funding models required to support the development of surface access projects at airports, in line with current work such as the recent publication of the Rail Market-led Proposals guidance. This will consider how government can accommodate airports and airlines that are looking to invest in surface access schemes alongside Highways England and Network Rail investment processes". Credible proposals have already come forward for private-led rail investment to open up Heathrow to the south, but government must be willing to share in future passenger revenue growth if it wants to encourage more.

Finally, there's a whole chapter on technology and innovation which highlights just how much the aviation world may change through trends such as automation, digitalisation and electrification. Drones, connected and autonomous vehicles and VTOL all feature, and there's even a mention of blockchain. The strategy envisages three key roles for government: better aligning R&D support; ensuring more agile policy and regulation; and helping public understanding of new technologies. This is all sensible stuff.

So despite the headline caution and desire to avoid public debate in the short term, beneath the surface some welcome radical thinking lurks in this document. In order to properly move forward, government really must now deliver on its promise of a parliamentary vote on Heathrow this summer. Heathrow expansion is vital and must be delivered, but the wider aviation strategy has been left in a holding pattern for long enough.

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