Examination of witnesses (Questions 320-335)
MR RICHARD EVERITT AND MR COLIN CHISHOLM
TUESDAY 11 JUNE 2002
320. That does make a difference.
(Mr Everitt) Of course, and it was very critical to me that they were on that group and fully involved. Their representatives think the changes are good changes and we will implement those finally, complete the implementation, the objective is November.
321. I am just trying to get the likelihood or unlikelihoodtake the safety out of the equationof some form of prolonged delay in the summer season?
(Mr Everitt) The system, as we have explained, is a system that we are learning how to use in operation. We have done 650,000 flights with the system so far. We are doing everything we possibly can to ensure that the risks of any further problems are very low but we are in a learning phase, which was what I was said to the Committee last time, and it will take us some months to completely understand possible issues around the system. As we sit here today I think the risks are very low.
322. How much of the extra money that you want from the Government will go to EDS as part of the out of court settlement?
(Mr Everitt) We have actually paid EDS the bulk of the money that we agreed with them.
323. Presumably that money came out of your finances. How much of the Government money will replace what you gave EDS in settlement out of court, if we are being precise?
(Mr Everitt) I am not able to tell you.
324. We will take a note from you, Mr Everitt.
(Mr Everitt) I will give you a note.
325. What about compensation for all those people whose holidays were spoilt because of the glitches with your computers?
(Mr Everitt) We have had a small number of requests for compensation. Those were not circumstances in which we would pay compensation. Formally Parliament said that we would not be required to pay compensation under the Transport Act, but regardless of that
326. How much do you think people should have been paid if the Act had not given you an exemption?
(Mr Everitt) In strict legal terms I do not think compensation would be payable. There are often problems with systems. We have problems on railways, we have problems with other highly complex computer systems that we are increasingly reliant on as a society.
327. The railways do usually pay up, rather reluctantly, rather meanly, for substantial delays but you are not paying anything.
(Mr Everitt) I think only for season ticket holders from my memory.
328. The principle is they have paid up but you are not intending to pay up.
(Mr Everitt) We are not intending to pay.
329. Are you apologising to all those people whose holidays were ruined?
(Mr Everitt) I apologised publicly for the disruption that resulted. These were issues which we could not have foreseen and I think they were issues we dealt with as expeditiously as we could do in the circumstances.
330. How are you going to convince my constituents that you are treating everybody fairly? We have got some airlines who are shareholders, we have got some airlines who are not and there is clearly a clash there and you are going to have some airports that are going to be shareholders and some airports that are not. If there is a glitch in the future how are you going to convince people that you are being evenhanded with all the people involved and you are not giving preference to those people who are shareholders?
(Mr Everitt) I think in practice it is impossible to give preference to any one airline regardless of who that airline is. It is just not physically possible when you are trying to run a system as intensively as we run this system to give preference to anyone.
331. I did not actually ask you whether it is possible, I was asking you to convince my constituents that you are not going to show a preference. Surely in the charging policy and in access and other things like that it is extremely difficult to say that you are being evenhanded.
(Mr Everitt) The charging policy frankly is totally out of our control. The structure of charges is set by Eurocontrol, the price formula is set by the Civil Aviation Authority and we have a single charge based upon weight and distance, which I promised you a note on. There can be no question of preferential charges. The only argument that there could be is that somehow or other a controller somewhere says "You are British Airways, you are a shareholder, you come in and Lufthansa, you wait in the queue". It is just technically impossible for it to happen. It does not happen, it will not happen, it cannot happen.
332. Are you giving preference to British Airports Authority airports over the other airports?
(Mr Everitt) So far as the airports are concerned we are a contractor at BAA airports and seven other airports in the UK. We provide air traffic control services on contract, BAA will have no involvement in that business whatsoever, that is clear and was agreed with them right at the beginning, it is in a separate company.
333. Do you agree with the CAA's conclusion that if the banks were not going to be happy to provide further finance in the second control period NATS would have to go into administration?
(Mr Everitt) That is a conclusion that they made observations on in their report. My job is to put together a package which I hope will give us a sound financial future and persuade the CAA to go along with it.
334. Frankly, is that something that surprised you, that they should ask such questions?
(Mr Everitt) No, I do not think it surprised me as such. They made positive observations about the business and how the PPP had operated. Clearly we need access to finance in order to run the business and to make the investment.
335. And you do not agree that your gearing is such that it is very clear that if the banks who are now totally in control want to pull the plug on you they can cause enormous difficulty to the whole of air traffic services?
(Mr Everitt) That is open to the banks, of course, but they have not done it and we have been in discussion with them for nine months now. The national interest dictates that we find a solution, that is what the CAA invited us to try and do.
Chairman: Thank you very much, Mr Everitt. I am sure we will all be very happy to know the banks consider the national interest first. We are very grateful to you both.