Civil Aviation Bill

Debate between Steve Baker and Mark Reckless

Monday 30th January 2012 Commons Chamber

[Mark Reckless (Rochester and Strood) (Con)]

It is a pleasure to follow my hon. Friend the Member for Daventry (Chris Heaton-Harris), who told us about his courting days under the Heathrow flight path. I am sure that colleagues were delighted to hear that he still regularly returns to Heathrow with his now wife. It is not clear whether they do this on their anniversary or not, but it seems that a certain amount of shopping at Heathrow is involved.

I am also pleased to follow my hon. Friend the Member for Witham (Priti Patel), who put the case for Essex very well and looked strongly after the interests of her constituency and Essex more widely in her remarks about Stansted, the strong progress on expansion and the strong economic role being performed at Southend. I know that the councils for Southend, Thurrock, Medway, Kent and Essex are working together as a local economic partnership on sensible proposals on aviation and alternative options to the Thames estuary option, which was so ably dismissed by my hon. Friend the Member for Thurrock (Jackie Doyle-Price). The Secretary of State was not in her place at that time, but I have every confidence that the Under-Secretary of State for Transport, the hon. Member for Lewes (Norman Baker) will pass on those very strong arguments in private as strongly as he does in public. Let me also take this opportunity to thank the Secretary of State for the very strong support she has shown for our area by holding back the increase in the Dartford tolls and in what she has done on train regulation and fares.

The debate has been largely non-partisan. Indeed, the regulation of aviation has been a non-partisan and technical area on which both parties have worked closely with Whitehall going back all the way to 1967 when the Edwards committee first looked at aviation regulation. It took a full two years to report, in 1969, to the then Secretary of State Anthony Crosland, and the report led to a White Paper from the then Labour Government. With the new Conservative Government in 1970 came the Civil Aviation Bill, which followed through on that preparatory work. There are clear parallels between that work and the way we are working together on these issues now.

It is worth noting that when the CAA was set up it was a pathbreaker for other regulators. The then Minister for Trade, Michael Noble, said, on introducing the Bill, that the CAA would be a “constitutional innovation.” He went on:

“The key point perhaps is that we are in this Bill hiving off a regulatory function. Ministers remain responsible to Parliament for policy, but detailed decision rests with the Authority.”—[Official Report, 29 March 1971; Vol. 814, c. 1173.]

That was new then, but we have since seen the development of regulators in many different contexts. The challenge between ministerial and parliamentary responsibility and expert opinion remains with us today and is core to this Bill.

A very positive development, in contrast with what we saw in the late 1960s and early 1970s, was the fact that the Pilling review of the Civil Aviation Authority was brought about by elected colleagues on the Transport Committee rather than by ministerial decision. That report was published in July 2008 and was followed up by Labour Ministers in the previous Government in a statement to the House and then in a consultation paper. The fact that that all came as a result of the Select Committee is new and is very much to be welcomed. When the previous Government engendered the proposals, the then Minister noted that

“as now, the CAA will only be able to act where it is reasonable and proportionate and where it has legal power to act.”

However, the CAA responded:

“The DfT’s proposals build on many activities already undertaken by the CAA, but give them a clear statutory basis”.

The then Minister did not explicitly accept that the CAA had been operating beyond its statutory remit, but the Bill is long overdue, as it will bring clarity to what the CAA does, and make sure that that is Parliament’s intention.

[Steve Baker]

Does my hon. Friend share my slight concern that more flexible regulation may result in greater uncertainty in major capital investments in airports? Has he considered whether the CAA will be able to provide the stability that investors need?

[Mark Reckless]

Our right hon. Friend the Prime Minister set out three clear principles on quangos and cases in which they might be justified. Conservatives are strongly against unaccountable quangos, but the three scenarios that the Prime Minister set out were, first, a precise technical function that needed to be performed to fulfil a ministerial mandate; secondly, a requirement for politically impartial decisions on public money in particular circumstances; and, thirdly, cases in which the facts needed to be transparently determined. The CAA fulfils the need for a precise technical function to be performed to fulfil a ministerial mandate.

I welcome the Bill. Although, as my hon. Friend the Member for Wycombe (Steve Baker) said, it provides more flexibility, it engenders far greater clarity. To date—and we have given this to the CAA—the authority has had four different objectives, but there is a lack of clarity about their order, so, inevitably, it has great discretion in how it chooses to balance those potentially competing objectives.

In the Bill, under the single duty that the Government propose giving to the CAA for consumers and their interests, it is much clearer where the authority is going. Regulation, while more flexible, should none the less be more predictable to people in the industry and to other stakeholders. That is broadly welcome. The same applies to appeals. If anyone is dissatisfied with a CAA decision, the only recourse is simply judicial review and the application of Wednesbury principles as to whether the decision has been properly made. The appeal process in the Bill is much improved, because a specialist competition tribunal will be introduced, and it will look at the objectives that have been set for the CAA by Parliament. It will assess in an expert yet judicial way whether or not they have been properly met. Ministers are not persuaded that there should be a right of appeal for the Secretary of State on licence conditions, but when regulations are extended to price cap anew or to remove a price cap, the Secretary of State may have the right to appeal. It is not clear from the explanatory notes whether that reflects the EU dimension or whether Ministers genuinely believe that that is a positive measure.

The cap application is significant. Manchester was de-designated, and Ministers made that decision—a statutory order was made—but the principles behind that de-designation were not clear, making investment difficult in some circumstances for the aviation industry. If we have a clear parliamentary test of when a price cap is needed, that should provide greater clarity for industry participants.

It would be difficult to have an environmental objective and a consumer objective, then look to an independent regulator to balance the two. The right approach for the greenest Government ever is for Ministers to make those decisions and to set a clear framework, whether in taxation or planning, for industry. That is the best way to balance those objectives.

A key issue is flexibility, and flexibility in the price cap is particularly valuable. The CAA currently has an opportunity to set the price cap only once every five years, and when circumstances change the price regime can be left looking inappropriate, but nothing can be done about it. For example, the CAA’s decision notice, published in March 2008, states that

“at Heathrow, the CAA has built into the price caps contingent funding for the costs of developing further”—

during the five-year period—

“the option to expand the capacity of the airport.”

The House of Commons Library has confirmed that that was a reference to the potential third runway at Heathrow, which of course did not happen and—Ministers are very clear—will not happen. None the less, Heathrow is still to be regulated on the basis of an RPI plus 7.5% a year increase in the overall landing charge revenue, but there is no opportunity to review that in the light of the decision not to develop a third runway at Heathrow.

The shadow Secretary of State, if I heard her correctly, said that the Government have a blanket ban on expansion at airports in the south-east. I believe that that is quite wrong. Look at what Luton airport is doing through its road show and expansion in capacity or, as my hon. Friend the Member for Witham explained, what Southend airport is doing. Last week I met representatives of Birmingham airport, who talked about expanding by 25 million passenger movements, the vast bulk of which would relieve pressure in the south-east. At Gatwick a significant increase in capacity is planned, even before the second runway restriction runs out in 2019.

The key criterion is the benefit to consumers of the regulation. However, there is something about aviation regulation that makes it different from other regulation, because in the middle there are the airlines. Sometimes their interests are the same as the consumer’s, but other times they are not. The landing charge at Heathrow is perhaps only £16 a passenger, compared with £50 to £80 for “Boris island”, and £16 or thereabouts is really not expensive. Given the economic benefits of using Heathrow, a huge amount of the benefit accrues to the airlines that happen to have slots there. The regulation in those slots is imperfect and has developed over time, but were the regulator to increase charges at Heathrow, it is not immediately obvious to me, as an economist, whether that would be passed on to consumers in the usual way. To the extent that Heathrow is almost at capacity and landing charges are so low, despite the high value of a slot, an economic analysis suggests that lower restrictions on landing charges might lead to a lower slot price and greater flexibility for the efficient allocation of slots, rather than that necessarily being passed on to the consumer. How the CAA will regulate this is therefore an important area of principle to consider.

The chairman, deputy chairman and non-executive directors of the CAA will be appointed by the Secretary of State, which is very sensible. It is difficult to see why the Secretary of State would also want to appoint all the executives, let alone determine their precise remuneration. We want to ensure proper accountability to Parliament. Some colleagues have mentioned the National Audit Office. I understand that the chief executive would be signed off by the Secretary of State as well, although the nomination would be made by the non-executive directors. I also hope that we would have appropriate parliamentary scrutiny of those appointments.

I am grateful to colleagues on the Transport Committee for the work they have done on this. It is excellent that everyone is working together and I look forward to hearing the Minister’s comments. It is certainly a strong positive for the regulation of the sector in this country.

Police Reform and Social Responsibility Bill

Debate between Steve Baker and Mark Reckless

Thursday 31st March 2011 Commons Chamber

[Mark Reckless (Rochester and Strood) (Con)]

As the only Member of this House who is a member of a police authority, I congratulate Ministers on this Bill and welcome it. The Home Secretary made it clear on Monday that she wanted elected commissioners “in charge”. She said just now that commissioners will make sure that what local people want to happen in policing will happen. That is to be welcomed.

Unfortunately, Opposition Members are on the wrong side of this debate. The shadow Minister, the hon. Member for Gedling (Vernon Coaker), said that

“ACPO is clearly telling the Minister that he needs to amend the Bill”—[Official Report, 30 March 2011; Vol. 526, c. 404.]

Apparently, the Association of Chief Police Officers thinks that

“the Bill places too much emphasis on local considerations giving disproportionate power to the”

elected commissioner. But it is this House that decides, not ACPO. The Minister for Policing and Criminal Justice has said that we have to rebalance the tripartite system and put greater emphasis on the local and democratic element because too much power has gone to the centre. He was too diplomatic to say it, but ACPO has taken that power as much as the Home Office, and it needs to be rebalanced.

We will attempt to reach agreement on this protocol, and Ministers are no doubt working hard on that. We believe, of course, that in individual investigations and arrests there has to be complete independence for the police, and that politicians should have no influence in that. However, in wider issues such as policing policy, the budget and the priorities, it is surely right that there should be democratic control and oversight.

[Steve Baker (Wycombe) (Con)]

I welcome my hon. Friend’s remarks, and associate myself with them. I also welcome the way that he set out the law on operational independence yesterday. Does he agree that it is vital that senior police officers and Opposition Members accept the legitimacy of elected representatives ensuring that the public get the policing that they deserve?

[Mark Reckless]

Of course I accept that, and I thank my hon. Friend for his comments.

In the short time available, I want to make one point about an aspect of the Bill that I disagree with and how it is to be implemented, and that is the setting of the precept. There is a great focus on having more local democratic control, but there is perhaps some misunderstanding about how the panel will work in relation to the precept.

We have heard that Liberal Democrat Members want a strong panel, and that there is currently something called a veto in the Bill. However, the small print shows that the panel will have no veto on the precept. All that it will get to do is say, “We don’t like this.” The elected commissioner will have to take into account what it has said, but he can then impose what he wants. At the moment, it is the Secretary of State who is to have the power to intervene and hold a referendum, not the local panel. I hope that will be reconsidered and changed in the other place.

When the Minister for Policing and Criminal Justice explained the relevant regulations on Report, he said it would be for the panel to put forward an alternative, and then the public would decide. In Committee, however, he said that it would be for the police and crime commissioner to give an alternative that was not excessive, and then the referendum would be to choose between the two. The local people should be in charge—that is the focus of the Bill, and I hope the matter will be considered in the other place. I commend the Bill.