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Aviation History
1957
1957 - 0155.PDF
FLIGHT, 1 February 1957 157 CIVIL AVIATION AIRPORTS AND THE TAXPAYER: A HARD-HITTING REPORT A YEAR ago, in our issue of January 6, 1956, we reviewed anofficial report investigating the management of Britain's air- ports. "This report," we said at the time, "is a rather forbidding-looking document of nearly 300 closely printed pages, consisting largely of lengthy transcripts of verbal evidence. For this reason,perhaps, its findings have not been widely publicized in the national Press, though 'revelations' would not be too strong aword to apply to some of the facts disclosed." The report just issued,* and which has been widely publicizedin the national Press, contains the observations of the Treasury and the Minister of Transport and Civil Aviation on the recom-mendations of the first report. It reveals also that the losses incurred by Britain's State-owned airports, far from havingdiminished, have increased. The actual operating loss has risen from about £ 1.67m to£ 1.86m—despite an 18 per cent increase in passenger traffic and a 39 per cent increase in freight. And taking into account non-operating expenditure—such as administrative costs away from airports, depreciation and capital interest—the true loss has risenfrom about £6m to about £7m. In effect this means that the average air traveller receives from the taxpayer an 8s subsidy onhis airline ticket. This would be higher were not some airports privately or municipally owned (see below). The report says that the increased losses make it "incompre-hensible" that the Minister has not been prepared to take more energetic measures to increase revenue. Indeed, the report observes,it seems doubtful whether the Minister has taken "any measures at all to this end." The operation of the aerodromes is either "soinefficient or so financially insolvent that the more traffic there is, both passengers and freight, the greater the loss becomes." The committee sees no reason "why air travel and the airwayscompanies should be in such a favoured position compared to bus, railway, shipping and harbour companies and corporations." Thisstate of affairs would probably not, we feel, be regarded as too disturbing if it was felt that practical steps were being taken towipe out at least the operating losses. Altogether seventeen recommendations were put forward inthe original report. The principal ones are as follows : Recommendation 4: "A determined effort should now be madeto produce trading accounts for the Ministry's aerodromes in a form acceptable to the committee of public accounts." The Minis-try's comment upon this recommendation is that complex account- ing problems would arise, but that this is a matter "which requires,and will be given, further (and detailed) study over a period." Recommendation 6: "Municipalities should be encouraged toown and operate their airports and to this end the Ministry should restate their policy on the municipal ownership of aero-dromes . . ." One of the Minister's comments on this is that he does not think the advantages of municipal operation would besufficient to justify any drastic change, but he considers that "there is room for variety in the ownership and operation of aerodromes,"with the parties concerned "all having a useful part to play." Recommendation 8: "The question of attracting increasedtraffic to the Ministry's aerodromes should be reviewed forthwith." The Minister's observation on this recommendation is that he is *"Special Report from the Select Committee on Estimates, Session1956-57" (Civil Aerodromes and Ground Services). H.M. Stationery Office, price Is 3d. "in some doubt" as to what it means: traffic is increasing con-tinually. The report's comment is that it is "surprising" that the Permanent Secretary of the Ministry of Transport and CivilAviation has said in evidence: "We do not try to attract traffic ... The object is not to make as much money as we can on the aero-dromes, or even to make them pay." Recommendation 9: "In view of increased costs and the con-tinuing loss on aerodromes in spite of increased traffic, landing fees should now be increased." The Minister observes that he hasto take into account the possibility that such increases might tend to divert traffic from this country and might check the increase intraffic. A further review of policy will be made in light of the conclusions made at the end of the November 1956 I.C.A.O.Conference. Recommendation 11:" The passenger service charge should bereviewed with the object of (1) setting the basic rate higher . . . and (2) considering whether the charge should be levied onpassengers landing rather than departing." Here again the Minister says that the proposal will be considered in the light of the I.C.A.O.meeting. [The I.C.A.O. conference urged the airlines "to make arrangements between themselves so that passengers will not haveto make separate payments each time they land at an airport."— Ed.] The committee's point here is that "to continue virtually thesame fees and charges as prevailed in 1948 ... is not fair to the taxpayer who has to meet the losses through taxation . . ." and"to continue the present level of fees and charges is in fact subsidizing air travel. . ." Recommendation 16: "More urgent measures should be takenby the Minister to develop amenities and concessions at airports." The Minister's comment is that he welcomes any proposals fromprivate enterprise for financing and developing amenities in a manner consistent with the efficient operation of the airport.* * * A sequel to the publication of the report was a statement issuedby the private-enterprise operator of the British Aviation Services Group, which comprises the following independent airlines:Silver City, Britavia, Aquila, Lancashire Aircraft Corporation, Manx, Air Kruise. We reproduce the essence of this statement;it should be read in the light of the fact that 80 per cent of traffic movements in the U.K. are handled at Government-owned air-ports; nearly half the remaining 20 per cent is handled at Silver City's private airport at Ferryfield: — "In common with other independent airlines we are disturbed [saidBritish Aviation Services] by the report's inference that we are being subsidized by the State, whereas in fact it is the State's own corpora-tions which are being subsidized with taxpayers' money. "Whereas the Corporations and other major international airlinesuse State airports almost exclusively, a very high proportion of indepen- dent airline operations are conducted from private and municipally-owned airports at no cost to the taxpayer. "In fact it was the lack of adequate passenger facilities at one Stateairport which forced Silver City Airways, one of our group's sub- sidiaries, to build Ferryfield—the all-weather airport at Lydd, Kent.Despite the cost of this and similar projects undertaken by municipal authorities they and many other independent airlines have been ableto reduce their fares. "Schiphol Airport, Amsterdam, which ranks as one of Holland's maintourist and entertainment attractions, is a striking example of how an international airport can be made to attract revenue without imposingextra burdens on passengers or taxpayers." Field Aircraft Services installed and furnished the writing-room and sleeping quarters of the special Viscount for the President of Brazil (see page 129). Fabrics, lighting and structural materials were studied and prepared with meticulous care.
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