CBI: UK will be a 'branch-line destination' without a clear aviation strategy
Chief Policy Director, CBI
Post date: Wednesday, 18th April 2012
The UK risks becoming "a branch-line destination", finding it increasingly hard to compete in global export markets, without a clear aviation strategy which deals with short, medium and longer-term needs, the CBI has warned today.
In a speech to a Transport Times conference, A new strategy for UK aviation, Katja Hall underlined the urgent need for action to underpin UK exports and investment.
The eleven major policy reviews on airport capacity since the last full-length runway was opened in the south of England in 1948 illustrate the degree of political challenge here. But the consequences of this indecision can no longer be ignored.
The UK is becoming a branch-line destination on the route map of global airlines. This is a damaging break in the UK's export chain, and its consequences are a real concern for businesses across the country.
We need to act now to ensure the UK remains a world-class business destination, and lay a key building block for achieving increased trade with high growth economies.
The impact of government inaction
With a private sector prepared to provide the airport capacity to meet rising demand if a clear government strategy can be set out, a continued policy of no policy represents a serious political gamble.
It leaves us with one hand tied behind our back in our attempts to capture trade and investments in high growth markets. And in this Olympic year, where our focus should be on promoting the image of a world-beating UK, this is not the brand of an ambitious global economy that UK businesses want to be selling.
The need for additional airport capacity to boost business growth
The Chancellor's Budget last month rightly focused on growth, and on driving an economic recovery powered by investment and exports. To achieve this, and to meet the Chancellor's ambition for the UK to more than double its exports to £1 trillion a year, we need decisive leadership from the government.
The UK has used its transatlantic geography over the last half century to put itself at the centre of the international air network. But as the global economy moves east and south, constraints at a hub airport running at 99 per cent capacity are preventing airlines from meeting demand for flights to growth markets in emerging economies.
Every day, we're ceding ground to competitors. There are now seven major cities in China served by the airports in Frankfurt, Paris or Amsterdam that aren't served by direct flights from the UK. Germany now has 60 direct air links a week with China, twice as many as the UK.
This risks undermining our image as a global hub for trade, as an international centre for finance and as an open destination for overseas investment. It threatens our ambition as a centre for manufacturing in high-tech, high-growth industries. And it hits the export potential of individual businesses across the UK.
The need to support regional airports alongside a hub
We cannot become obsessed by a polarised debate that seeks to present development of our hub capacity and growth at other UK airports as mutually exclusive options; they are not. An effective hub should be complementary to a network of thriving regional airports providing direct links to the most popular destinations in Europe and beyond.
CBI's proposals on aviation
In the immediate term, we need to maximise the capacity of our existing airports. This means prioritising road and rail schemes to improve surface access to a number of airports, including Gatwick, East Midlands, Newcastle and Bristol. It also means allowing more ‘mixed-mode' operations at Heathrow, to open up some breathing space for new flights and increased resilience at the airport.
And we need to begin a process now to deliver a new runway to serve the south of the UK within the next decade - at Heathrow, Gatwick, Stansted, Birmingham or elsewhere - subject to an urgent review of the most feasible option to address the current serious constraints at Heathrow.
And for the longer-term we need to explore all options, including a new hub airport for London.