Select Committee on Transport, Local Government and the Regions Minutes of Evidence


Examination of Witnesses (Questions 312 - 319)

WEDNESDAY 9 JANUARY 2002

MR DAVID JAMIESON MP, MR IAN DEVLIN AND MR ROY GRIFFINS

Chairman

  312. We are very grateful to you for coming this afternoon. Would you like to make some preliminary remarks or would you like to go straight to questions?
  (Mr Jamieson) Can I say I am very pleased to be here this afternoon. Can I firstly ask my two officials to introduce themselves.

  313. Perhaps they will identify themselves.
  (Mr Griffins) I am Roy Griffins, Director General of Civil Aviation.
  (Mr Devlin) I am Ian Devlin, I am the Director of Transport Security Division.
  (Mr Jamieson) Mrs Dunwoody, with your permission if I can make a few brief introductory remarks. Can I firstly say, I have been on a select committee for some years, five years, and this is the first time I have appeared on this side of the fence, so to speak.

  314. I am sure you will enjoy every minute of it.
  (Mr Jamieson) Can I also at this point pay particular tributes to some of the officials, not only those that are here, but some of them in the Department and in other parts of our organisation who have done so very much since 11 September, some of them have worked very long hours giving advice to airlines and to airports, they really have done a very special job. I would like to put that on record. It is not often said, but I am probably one of the few people who have had the opportunity to see how hard and loyally some of those people have worked. What I will do, as always, is endeavour to give you the fullest responses. You will appreciate this is a highly complex area and I am sure that my officials on occasions may be able to help perhaps with more of the detail or if anything that I say may be inaccurate I am sure they will be rapidly putting me right. Everything that needs to be said has been said about the tragic events of 11 September. It certainly ushered in a very critical period for the airline industry. Up to that point the industry in the United Kingdom particularly had been a success story. We see now that the government has some role in trying to restore that industry back into the shape that it was previously. I think there is an area where we have a legitimate role. An example of that role that we have is maintaining the confidence of the travelling public, overseeing the safety and security arrangements and I think also making sure with our European colleagues the framework for fair competition for the airlines. I think the area where the government does not have so much a role is I do not think we are in a position to buck the market place or we are not in a position to say how many people should be flying or to artificially try and boost demand, it would be wrong for us to do so. I think also there is a danger that we could find ourselves protecting the industry from long-term trends of supply and demand which have to take place in the market place. I think the other area is that we certainly approached the European Commission on were the state aid issues and we are keeping a very close contact with them on that. In Section 2 of our written evidence to you, Chairman, we submitted in November last year we did flag up that there would be a number of areas, possibly, that would be out of date by the time we got here to the Committee. If I could just cover a few of those. There are quite a few areas which need updating now but if I could just cover a few of those. Certainly the new European Union Regulation containing Common Rules on Aviation Safety, we welcome and they are having an effect of securing common levels of security across the Community. Some of those additional levels of security, I am pleased to say, were already being carried out in the UK and we were already compliant. Certainly there has been a precipitous decline in air traffic since the 11 September. We are told that the figures for September, comparing September 2000 with September 2001 it is 11.5 per cent reduction for September for BA—Sorry, it is 14.6 for October, it is 11.5 for November but 8.5 for December which seems to suggest that there is a slowing down, if you like, of the fall off of traffic.

  315. You are saying specifically for BA?
  (Mr Jamieson) For BA, yes.

  316. You are not saying for any other airline?
  (Mr Jamieson) That is right. Those are the figures which we think are probably a fairly good proxy for the airlines in this country. The other thing that is very difficult to assess, Chairman, at this stage is there is a lot of speculation as to whether what happened on 11 September would cause a greater or lesser effect than what happened after the Gulf War. As yet that is very difficult to make an assessment on but obviously my Department are keeping very closely in touch with that. I think the two other areas where we need to just update our written evidence, Chairman, is on the insurance with the failure of the commercial market in insurance. We underwrote the insurance cover from late September and at the moment we have that cover in place until 23 January this year. We are looking at that, of course, on a week by week, month by month basis and in our evidence to you, also, we said that the European Union had set a deadline for the ending of the Government support for insurance, we had said it was the end of December, of course they have now moved that to the 31 March. I think at that time we will probably, ourselves and the European Union, be in a better position then to see how the Japanese and the US airlines are supporting their own industry and we will be in a position then to make an analysis of how we may react. Chairman, those are my brief opening remarks which I hope are helpful. If we are not able to answer anything today, either because of time or a lack of expertise or knowledge here we will be very happy to write to you or, if you so wish, we will be delighted, of course, to come back again.

  Chairman: That is very helpful, Minister. Can I begin by saying that I am glad you have paid tribute to those working in the Civil Service in the aviation industry, particularly in your own Department. There are many of us who believe that the expertise in your Department is not only amongst the highest not only in the transport industry in the United Kingdom but also in world terms and personally I would be extremely worried if I thought it was not appreciated in ministerial circles that the British Civil Service is not only capable of providing very high standards of support for transport policies but is frequently far better informed than many of the people with whom it has to deal. I suppose I should add in parenthesis that we do not always get the complete information that we should like from your civil servants but that is undoubtedly a matter of choice and not of lack of information.

  Mr Donohoe: Good training.

Chairman

  317. Good training, yes. Did you as Government ministers talk to the United States about the level of assistance that they were offering to their industry before it was announced or immediately afterwards?
  (Mr Jamieson) I am not aware of any discussions that we had at that time. The United States, Chairman, acted very, very rapidly indeed and I think unilaterally. I am not aware of any discussions that the United States had with any other country about the action they took. They took action which they felt was appropriate to their own country, some may argue that they over-reacted. They have a different scale of problem to ourselves. They had the complete shut down of all of their airlines and, of course, the scale of their airlines is very substantially greater, particularly on the domestic market, than our own. They took action which they felt was appropriate. In the United Kingdom, we have had a little bit more time to reflect carefully on how we should react and we are taking what we think is appropriate action.

  318. Yes. Nevertheless, of course, because aviation is an international industry, did you talk to the United States Government about the package that we were offering to our own airline industry, Mr Griffins?
  (Mr Griffins) Thank you, Chairman. Two responses. One we did not, as the British Government, talk to the United States Government. In answer to your previous question, we did not receive representations or information from the US Government prior to their aid package. The European Commission, indeed the Commissioner herself, took up the matter with the US Administration.

  319. With respect, I am sure the Commissioner is an excellent person but is of no concern to the House of Commons at the present time. Did you get a full briefing from the United States Government as to the size of the package, what it related to, how it would or would not distort the amount of state aid available to the aviation industry or have you subsequently enquired as to those details?
  (Mr Griffins) We have used various channels of information either directly or through our Embassy in Washington.


 
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