Examination of Witnesses (Questions 440-459)
MR DAVID JAMIESON, MR ROY GRIFFINS AND MR IAN MCBRAYNE
TUESDAY 11 JUNE 2002
440. What you are telling us is this one might be right or am I over-egging the pudding?
(Mr Jamieson) No, Mrs Dunwoody, the other graph is correct, I think it is just quite difficult to read.
Chairman: It is correct as long as you work for the Department.
441. If I could stay with these figures that you gave us earlier because on the figures you gave us earlierif I could stay with those because my eyesight is not what it used to beon the page which relates to current data for September 11, the figures of November 2001 very briefly were projecting a 12 per cent downturn in traffic.
(Mr Jamieson) Could I just ask which line we are on now, Mrs Dunwoody?
Miss McIntosh: You give it by months.
Chairman: This is the previous graph and not your four colour effort.
442. Yes, unfortunately you do not number the pages. At the top, the current data, 11 September terrorist attacks and the line I am referring to is the November 2001 line.
(Mr Jamieson) Yes.
Miss McIntosh: In which the figures project a 12 per cent downturn in traffic. The figure for the next page, the Gulf War data, January 16 1991 to February 28 1991, showsand I am just asking you to confirm these figuresthat the figures for that month of the Gulf War were similarly down 11 per cent. These are your figures and I am asking you to confirm your figures.
443. Are you telling us in simple terms, because I am a simple person, the original graph was incorrect or that was it was correct and unreadable and you have therefore produced a readable edition which although it may appear superficially to have differences in fact is the same information put in a more easily understandable form?
(Mr McBrayne) Can I help, Chairman? To the best of our belief all the information we have given you is consistent.
444. That is a great comfort to me.
(Mr McBrayne) The graph which we have just given you is merely, we hope, a clearer presentation of what we gave you before and reflects the figures for transatlantic flights from the tables which Miss McIntosh is quoting.
445. Can I just stay with the original graph we only got on 7 June and have had time to look at. I just want you to confirm that the figures were approximately the same, 12 per cent reduction for the 11 September terrorist attacks and 11 per cent reduction in the Gulf War?
(Mr McBrayne) In terms of immediate impact, yes.
446. It is not a trick question.
(Mr McBrayne) In terms of immediate impact that is right.
Miss McIntosh: What was the recovery time after the Gulf War as opposed to projections of recovery time after September 11?
447. That is a bit clearer from the graph.
(Mr Jamieson) Yes. I think this is where this graph is more helpful. I was concerned when we revisited the way that we had presented the information that it was correct but actually quite difficult to follow. The other thing that I asked is that we did look back to 12 months previously so that we could see properly the trends and they are shown here. I think if we look at the graph nowand remember these are the percentage increase or decrease on the 12 months previouslywe can see the Gulf War figure there is at around about 12 per cent decrease on the month of the event whereas the current situation was about five per cent. We can see what happened then after the Gulf War there was a very rapid recovery and in fact 12 months afterwards, of course as we would expect, there was a huge leap back upwards, as you would expect because it is a 12 month on 12 month figure. There was a rapid recovery. What we can see in the current situation is that there has been a fairly static situation at about minus 10, minus 11, and the current situation is that it is slightly increasing and the estimate that we have made at the end there is that there should be some small recovery.
448. That is the estimated forecast?
(Mr Jamieson) Yes. But the actual figures, from the last one where there is a little arrow saying "estimate", the previous ones were the actual figures they demonstrate so in fact we are still very much in a situation where if you look at the graph it is probably an average of about minus 10 or minus 11 per cent on the previous year and as you can see, just looking at the purple line, after the Gulf War there was a very rapid recovery and of course at the time of Lockerbie it really made no difference at all in terms of the growth of the industry, the industry carried on growing very considerably at that time.
449. Presumably, Minister, you will be attending and have attended the Council of Transport Ministers meetings in Brussels when they discuss this proposal of additional security measures being passed on?
(Mr Jamieson) No, I have not attended those meetings, the Minister of State has attended those meetings.
450. Are you able to share with us what the Government's view is on this and what it will mean for NATS?
(Mr Jamieson) Yes, Mr Griffins has been party to the briefings and may be in a better position to tell us about that.
(Mr Griffins) Yes, thank you, Minister. The Government's general principle on security costs is that the industry pays for its costs not the taxpayer.
451. You will resist the proposals? Are you going to have any allies?
(Mr Griffins) In general it does not come down to allies and enemies. It is normally left to Member States to choose whether to defray the airports' and airlines' security costs. If they choose to, and I know some European Member States do choose to, they can do so. If they maintain the principle that the airlines, the airports, the industry in general pay their respective costs the countries that think that are allowed to apply that policy; we think that.
452. Can I just ask you finally, what exactly did the Government pay in conjunction with NATS in professional fees to secure the PPP? Mr McBrayne, they are all looking at you.
(Mr McBrayne) In round terms, Chairman
453. Within £100,000 or so or the odd million.
(Mr McBrayne) Within a million I think £40 million.
454. Oh, just 40 million. Is that now completely covered? We have now paid off all those so there should not be an extra sum added in?
(Mr McBrayne) We are still receiving advice from both investment bankers and external lawyers so we are still incurring some costs.
455. We are still incurring some costs. Can we put the odd million estimate on that?
(Mr McBrayne) I cannot give you an exact figure at this moment but we can certainly let you have one.
456. We would like a detailed note on how much that is, how many people are still advising and how long you expect that to go on for and what the total cost will be?
(Mr McBrayne) Certainly.
457. Thank you very much. Minister, did any alarm bells ring in the Department when you saw the latest business plan and the amount of exposure of NATS?
(Mr Jamieson) We were concerned about the financial situation and therefore we wanted to see the new equity partner come in and we wanted to see its financial position secured for the future, yes.
458. Did you think this might have a terrible sense of deja vu and resemble something like Railtrack?
(Mr Jamieson) No. In no way at all. In fact, the more I have looked at this the more firmly I am of the view that we have here a company that is operating very successfully. They have good management. They are operating safely.
459. Has the management changed since you were telling us they were not very efficient in the run up to PPP?
(Mr Jamieson) I think what has happened is we have now got some private sector management expertise in there.