Covid-19: Aviation

Debate between Kelly Tolhurst and Huw Merriman

Wednesday 3rd June 2020 Commons Chamber

[Huw Merriman (Bexhill and Battle) (Con)]

To ask the Chancellor of the Exchequer if he will make a statement on covid-19 and the economic impact on aviation.

[The Parliamentary Under-Secretary of State for Transport (Kelly Tolhurst)]

My right hon. Friend the Chancellor has asked me to respond on his behalf.

The covid-19 crisis has affected every person in the country and every sector of the UK economy, and aviation is essential to that economy. It connects the regions together and it plays a huge part in the UK’s future as a global trading nation. That is why the Government have responded to the crisis with an unprecedented package of measures. On 24 March, my right hon. Friend the Chancellor of the Exchequer wrote to the aviation sector setting out the schemes being made available, including the deferral of VAT payments, the covid commercial finance facility and the coronavirus job retention scheme. The Civil Aviation Authority is also working with airlines, airports and ground handlers to provide appropriate flexibility within the regulatory framework. If airlines, airports or other aviation organisations find themselves in trouble because of coronavirus and have exhausted the measures already available to them, the Government have been clear that they are prepared to enter into discussions with individual companies seeking bespoke support.

We recognise that there remain serious challenges for the aviation sector, despite the measures that have been put in place. It will take time for passenger numbers to recover, and the impact will be felt first and foremost by the sector’s employees. The recent announcements about redundancies from companies such as British Airways, Virgin and easyJet will be very distressing news for employees and their families. These are commercial decisions that I regret, particularly from companies that benefit from the job retention scheme, which was not designed for taxpayers to fund the wages of employees only for those companies to put the same staff on notice of redundancy during the furlough period.

The Government stand ready to support anyone affected, with the Department for Work and Pensions available to help employees identify and access the support that is available. My Department has set up a restart, recovery and engagement unit to work with the aviation industry on the immediate issues affecting the restart of the sector and its longer-term growth and recovery. As part of that, we have established an aviation restart and recovery expert steering group, which is formed of representatives across the sector, including airports, airlines and ground handlers, industry bodies and unions.

The sustainable recovery of the aviation sector is a core part of our commitment to global connectivity and growing the UK economy. With airports, airlines and other parts of the aviation sector, we are putting in place the building blocks for recovery. The House will be updated as soon as possible on the next steps.

[Huw Merriman]

Thank you, Mr Speaker, for giving aviation workers in your constituency and across the nation the chance to have their voice heard. I am grateful to the Minister for being a tireless champion for the sector.

This is a hugely challenging time for the aviation economy. Job losses are inevitable, but many of us are concerned that companies are using the pandemic as a justification to slash jobs and employment terms—step forward British Airways, the only airline that is effectively sacking its entire 42,000 workforce and replacing it with 30,000 jobs on inferior terms. BA has tried that before, but its workforce resisted. It is ethically outrageous that our national flag carrier is doing that when the nation is at its weakest and when we expect the country to do its bit.

May I ask the Government to use their full weight to stop unscrupulous employers using the pandemic as a chance to slash terms and conditions? Will the Department ask the Civil Aviation Authority to undertake an urgent review of reallocating lucrative landing slots at Heathrow to companies such as British Airways that indicate that they are downsizing, and perhaps handing them to companies that wish to expand and take on workers? BA has 51% of Heathrow landing slots, including the most profitable to John F. Kennedy airport. Will the Government change the job retention scheme to stop employers using it while simultaneously putting employees on redundancy notice?

On quarantine, that is the wrong policy at the worst possible time for the aviation sector and the economy. It gives companies such as BA justification for shedding staff and worsening terms and conditions. Thirteen of our 15 most popular international destinations have a lower R rate than we do. Will the Government commit to reviewing quarantine, bringing in air bridges from safer destinations, and developing an immediate exit strategy to allow the aviation sector to plan ahead? The situation is grave, but there is still time to save the aviation sector with further Government support and action to ensure that companies such as British Airways do their patriotic duty and stand by their hard-working and loyal staff, rather than deserting them.

[Kelly Tolhurst]

I thank my hon. Friend for his work as Chair of the Select Committee on Transport and the fair but firm way in which he is standing up for the aviation sector.

My hon. Friend asked about the Government’s ability to stop employers making poor use of the pandemic to slash terms and conditions. I certainly would not expect employers to use the pandemic as a chance to do so. I think most people would agree that terms and conditions are usually a matter for employees and employers, but employees have recourse to a number of options for support in cases in which that is happening. I highlight the fact that in crises such as this we would hope that all organisations that are taking such measures treat their employees with the social responsibility that one would expect. I will do everything in my power to make sure that that is understood by those organisations.

My hon. Friend asked about the ability to reorganise the slots process. He is right to raise that. The Government are currently legally prevented from intervening in the slots allocation process. However, we want airport landing and take-off slots to be used as effectively as possible for UK consumers. As the UK aviation market recovers from the impacts of this terrible disease, I want to ensure that the slots allocation process encourages competition and provides connectivity, so that is something I will be looking at.

The Prime Minister has been clear, and I will be clear again today, that the job retention scheme was not designed for this purpose. It will be for Treasury to review the specifics of the scheme, and I am sure that colleagues will be taking note of today’s proceedings.

The Home Secretary will be making a statement on the quarantine measures immediately after this, and I do not want to pre-empt her, but I can confirm that the measures will be subject to regular review. My Department, through the aviation restart and recovery unit, is working non-stop with the sector and Government partners to plan for the future of aviation, enabling it to recover. No option is off the table, and we are looking closely at air bridges, which are also known as international corridors. I will be working tirelessly, as I have done over the last 10 weeks, to do whatever I can to mitigate the impacts that have been felt by the aviation sector.

Flybe

Debate between Kelly Tolhurst and Huw Merriman

Thursday 5th March 2020 Commons Chamber

[Kelly Tolhurst]

I absolutely agree with the hon. Gentleman in the sadness that he expressed about the loss of jobs for people working for Flybe. When any organisation collapses in this way, it is a sad day for the individuals and communities it affects. I personally am extremely committed to making sure that we, as a Government, are working with colleagues to ensure that those individuals—those staff members—are given the advice and support that they require. In particular, we are very lucky in that we have been engaging with the industry, which is pulling together, and some airlines have said that they are going to prioritise staff from Flybe within their recruitment process. So that is good, and I am hoping to see movement on it as time goes on.

Turning to next steps, with regard to the passengers, obviously everybody is concerned about individuals travelling and how they will get back and move around the country. I reiterate that the majority of Flybe passengers are travelling domestically. As I have outlined, we are working with the airlines on fares and on making sure that the capacity is there. We are also making sure that people can travel on the railways. Of course, those conversations will continue. I am having a meeting later today, so if any MP would like to ask specific questions or get an update on where we are with that information, I would be very grateful if they attended.

I have great respect for the hon. Gentleman, because we have had many debates and discussions on a number of things over the years, but I disagree with his statement that we have sat on our hands. We, as a Government, have absolutely been working hard on this. We have been determined to be able to work with shareholders and work with the company in order to secure Flybe for the future. I must be really clear: we are in this situation today because Flybe shareholders and directors took the decision to place the business in insolvency. This is not where I, as the aviation Minister, wanted to be with regard to Flybe.

I am acutely aware of the impact that this will have on regional airports. The hon. Gentleman is right: we have spoken a lot about regional connectivity. However, we are determined to deliver on our promises to the country—that is, making sure that we are levelling up, and that regional connectivity via those airports remains viable. My Department and officials are working really hard with the airlines and the airports. We have been speaking to them today. I personally have had conversations with the airlines and the airports today. We will be maintaining that work in order to establish replacements and the ability of the industry to pick up some of the routes that are affected. We will look at and discuss some of the ongoing challenges relating to those specific airports.

The 80/20 rule, as the hon. Gentleman will know, is controlled by Airport Coordination Ltd and the European Commission. The European Commission is central to that, as he will understand.

My Department and I, specifically, have been having these conversations. I am in connection with the industry to understand the challenges, and I am taking that forward to do what I can, in my role as a Minister, to ease this burden. I stand here willing to speak to anyone this afternoon and to give people updates as and when I can. I hope that has given some comfort.

[Huw Merriman (Bexhill and Battle) (Con)]

On behalf of the Transport Committee, I want to express sympathy for the passengers inconvenienced and, in particular, the staff, who will be devastated and to whom I hope better things will come. Airline insolvency reform was in the Queen’s Speech. I know that the Minister works hard for business, but I want to press her: when will there be an opportunity to introduce legislation, so that we can help airlines as they either unwind or are able to recover?

[Kelly Tolhurst]

I thank my hon. Friend for his question and note his particular interest as Chair of the Select Committee. He is right that we announced in the Queen’s Speech that we would legislate to enhance the Civil Aviation Authority’s oversight of airlines and its ability to mitigate the impact of failure. I am keen to move that legislation forward as soon as possible, and I am happy to give him further updates.

Airport Expansion

Debate between Kelly Tolhurst and Huw Merriman

Monday 2nd March 2020 Commons Chamber

[Kelly Tolhurst]

I am grateful for the hon. Gentleman’s comments about last week’s judgment, but I should point out that the Government were clear in our manifesto that the Heathrow expansion project was a private sector project and needed to meet the strict criteria on air quality, noise and climate change and to be privately financed in the best interests of consumers. Airport expansion is a core part of the Government’s commitment to global connectivity and investing in our infrastructure. We welcome the efforts of airports throughout the UK to come forward with ambitious proposals to invest in their infrastructure, under our wider policy of encouraging them to make the best use of their assets.

We want the UK to be the best place in the world and we are forming new trading relationships with the European Union and negotiating free trade deals around the world. Last week’s judgment is an important step in the process. Heathrow Ltd is obviously able to apply to the courts to appeal, but we take our environmental commitments seriously and they are important to how we reach our objective of net zero by 2050.

I highlight for the hon. Gentleman the fact that we are committed to the decarbonisation of aviation, as that is an important part of our efforts on climate change. That is why we are maintaining momentum by investing in aviation research and technology. We are investing £1.95 billion in aviation research and development between 2013 and 2026. In August last year we announced a joint £300 million fund, with industry involvement, for the Future Flight Challenge. We will introduce a Bill that will modernise the country’s airspace, reduce noise around airports and combat CO₂ omissions.

The hon. Gentleman referred to the advice given to the Secretary of State. I understand that that advice may form part of one of the grounds of appeal of another party in the Supreme Court, so I am unable to comment while the proceedings are ongoing, but I will not take lectures from the Labour party when even Labour-supporting unions such as the GMB have called Labour’s plans “utterly unachievable”. As I have already outlined, airport expansion is a core part of the Government’s commitment to global connectivity and levelling up.

[Huw Merriman (Bexhill and Battle) (Con)]

There are many who take the view that big-ticket infrastructure projects such as Heathrow expansion will provide both the funding and the challenge to allow our scientists, engineers and innovators to deliver not only that project but similar infrastructure projects and market them around the world in places where they really do leave a big carbon footprint. The Minister has rightly said that this issue is a legal matter for the determination of the courts and a commercial matter for Heathrow; will she confirm that, if Heathrow is successful at the Supreme Court, the Government will not intervene to stop expansion occurring?

[Kelly Tolhurst]

My hon. Friend is absolutely right: we do lead the way in technology and innovation in this country, which is why we are investing in aviation research and development. I assure him that the outcome of any Supreme Court ruling will be respected.