Airport chiefs urge Stormont to fund air route strategy and scrap levy on short-haul flights
Airport chiefs have said that a new fund must be established in order to develop air routes from Northern Ireland.
They also called for the abolition of a contentious air tax on short-haul flights as a means of stimulating future economic growth.
Senior figures from Northern Ireland's three main airports addressed the Northern Ireland Affairs Committee’s inquiry on an air transport strategy at Stormont.
Issues discussed included air passenger duty (APD) on long- haul flights, which is in the process of being devolved to the Assembly after it threatened the province’s only transatlantic route last year.
George Best Belfast City Airport (GBBCA) chief executive Brian Ambrose said that the tax of £13 each way on domestic flights should also be axed.
“The only way to make a difference to inbound tourism and exports is to remove APD entirely,” said Mr Ambrose.
Belfast International Airport (BIA) managing director John Doran agreed the current levy “could cause Northern Ireland competitive issues”.
Albert Harrison, non-executive director of City of Derry Airport (CODA), said the tax should be scrapped, adding that a fund to help develop new air links was crucial.
“All three airports are working on this together and it is our intention to approach the Northern Ireland Executive with proposals on where we think an air route development fund would work,” Mr Harrison said.
“A fund for long-haul flights to the United Arab Emirates, the Middle East or Toronto, for example, would be well worth it.”
Mr Harrison said the Belfast/New York Continental flight was a good example of how such a fund can stimulate growth.
“Belfast International Airport invested £4m and Government put in £1m and the return has
been £100m,” he said. “Air route development funds help prove to an airline that the route is commercially viable —it’s helping the airline develop the route.
“But if we slap on a large APD it’s not going to be development, it’s going to be restricting and it’s going to have an impact on the number of people who can actually afford to come to Northern Ireland.”
CODA managing director Damien Tierney said APD is currently restricting growth in the market.
“Our main carrier Ryanair has told us quite clearly that routes into the UK will not be developed any further,” he said.
“They’ve pulled 18% seat capacity out of the UK year-on-year for the last two years and moved to Spain and Germany, where there’s less APD. They will move where they can make more money and £26 return on a seat from CODA to London Stansted is a lot of money when you consider the average fare that Ryanair charge is £60-£70.
“Ryanair is not on its own on this — easyJet and Flybe will be in the same position.”
Other items addressed were the lack of public transport links to and between the airports, and the implications of the takeover of bmi by British Airways' parent company IAG.
APD was introduced in 1994 with a £5 rate for the UK/EU and £10 elsewhere. Since then it has seen several increases, with the most dramatic rises happening each year since 2007. For short-haul flights the tax is £13, and £92 for long-haul flights of over 4,000 miles.
The travel industry has pointed out that the UK is increasing aviation tax at a time when many countries are abandoning it.
The Netherlands and Spain have reduced or abolished flight taxes after realising they were affecting visitor numbers, which harmed their economies.