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


Supplementary memorandum by the Department for Transport, Local Government and the Regions (NAT 2A)

NATS FINANCES INQUIRY—HEARING ON 1 MAY

  At the above hearing we undertook to provide the Committee with additional information to assist it with this inquiry. I am sorry it has taken a little longer than we would have liked to assemble the necessary documents.

  I am pleased to enclose the following information:

1.  Copies of correspondence relating to the capital structure of the NATS PPP deal

  At the hearing Mr Griffins undertook to provide the Committee with copies of his written replies to the letters dated 11 and 15 June 2001 received by him from Sir Roy McNulty, then chairman of NATS, relating to the capital structure of the NATS PPP. On re-examination of our files we have found that Mr Griffins did not in fact respond in writing to these letters but dealt with the issues raised in discussions he had with Sir Roy.

  However, we appreciate that the Committee was interested in the Department's reaction. This was set out in writing in response to the reservations expressed by the Civil Aviation Authority (CAA) about the NATS capital structure. I hope the Committee will therefore find it helpful to see the relevant correspondence between the CAA and the Department. I accordingly enclose copies of a letter from Mr Andrew to Mr Griffins dated 23 May 2001, Mr Griffins' reply to Sir Malcolm Field dated 17 July 2001 and Sir Malcolm's response of 20 July 2001. (Annex 1)

2.  Graphs detailing the effects of major incidents on transatlantic air traffic

  The Committee was interested in comparisons of the effects on transatlantic traffic between the events of 11 September and other major incidents, such as the Gulf War and Lockerbie. I accordingly attach a graph detailing the percentage growth in North Atlantic flights in the months following 11 September, Lockerbie and the Gulf War period, as compared with the corresponding month in the previous year. (Annex 2)

3.  Department's forecasts for air services

  The Committee asked for copies of the Department's forecasts of the demand for air services.

  I attach the latest forecasts produced by the Department, which were published in 2000. The table details forecast terminal passenger numbers at UK airports from 1998 to 2020, and the graph illustrates actual and forecast passenger numbers at UK airports from 1975 to 2020. (Annex 3)

  At the mid-point of the forecasts, air traffic at UK airports is expected to grow at an average 4.25 per cent per annum up to the year 2020. It would grow at an average of 3.6 per cent and 4.9 per cent under the low and high scenarios respectively.

  Please let me know if the Committee would like clarification of any points in this information.

  I hope this is helpful.

David Jamieson

Parliamentary Under Secretary of State

20 May 2002



 
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