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Aviation History
1963
1963 - 0730.PDF
FLIGHT International, 16 May 1963 • 703 AIR CO E R C E BRITAIN GOES TO THE BRINK AS this issue went to press the Minister of Aviation was ex plaining to Parliament his reasons for threatening, on May 10, to withdraw the UK landing rights of Pan American and TWA. Whether or not this extreme sanction of civil aviation sover eignty will have been invoked (for the first time in an inter national fares dispute) by the time this issue appears depends on the CAB. Will the Board back down on its refusal to allow US airlines to charge the higher IATA fares? The CAB's chairman, Mr Alan Boyd, has already said that if matters do reach this extreme stage, his Board would probably allow the higher fares, leaving world opinion to judge the lengths to which America's competitors will go to get a fare increase. Probably Mr Amery's real reason for going to the brink is because the CAB—having on its own admission caused such chaos in the industry by its late veto—would not agree to let things ride for the summer so that IATA could have time to reconsider its fare agreements. It is significant, and also incon sistent, that the Minister has not similarly threatened TCA and CPAL. even though the Canadian Air Transport Board— like the CAB—has disapproved the IATA fare increases. BOAC, who are in pool with TCA, are not increasing their fares to and from Canada. Unfortunately, whatever the outcome of this unhappy affair. Pan American and TWA will be wearing the haloes while BOAC's image, especially in the USA, will suffer. This episode will not—most unfairly—endear or sell BOAC to the American public, who will now be even more disposed towards the fly- American campaign. In the long term, because airline efficiency must count in the end, these events will strengthen the influence of the US airlines in IATA and of the CAB over IATA— which is precisely what the Americans have been trying to achieve. The Minister's speech in the Commons, and the civil aviation debate, will be reviewed in next week's issue. MR WYATT SPEAKS OUT IN one of the most forthright statements ever made by an indepen dent about a corporation, Mr Myles Wyatt, chairman of British United, has this to say in respect of BUA's Genoa traffic rights:— "The officials of the Ministry of Aviation are to be congratulated on their conduct of these lengthy and difficult negotiations, which must have been made much more difficult by BEA's endeavours to frustrate them—in particular, by BEA's action in publicly applying to the Air Transport Licensing Board for the Genoa licence to be revoked at a time when the British Government was still actively negotiating with the Italian Government on our behalf. It is a sorry spectacle when a nationalized corporation publicly attemps to frustrate the Minister to whom it is responsible in his endeavours to carry out the declared policy of the British Government." In fairness to BEA it should be said that their re-application for Genoa was made at a stage in the UK-Italian negotiations at which deadlock appeared to have been reached (Flight International, March 14, 355, and below). It might even be said that it was BEA's application, because it threatened to make such a nonsense of the UK licensing system, that spurred the Ministry of Aviation's efforts to get Genoa for BUA. THE TEST CASE GENOA is much more than a new place on BUA's route map. For the Minister of Aviation it has been the supreme test of whether he wants the British civil aviation licensing system to work or not. Traffic rights, like most things, have their price; and in the case of Genoa it is BOAC who are being called upon to pay. A most important precedent has been established. The Minister is requiring a corporation to pay the fee for an independent airline's traffic rights. As everyone knows, so far as international routes are concerned the British licensing system is heavily biased in favour of the corporations. A Minister with a vested interest in the corporations is the same Minister who has to get foreign rights for independents —rights which his corporations say will hurt them. The Genoa case was the embodiment of this bias. It was a new route, for which an independent and a corporation were applying to the Air Transport Licensing Board on equal terms. The ATLB favoured BUA because they believed it would give them a chance to prove their mettle. BEA appealed to the Minister of Aviation, on the grounds that the ATLB should not experiment like this. On the recommendation of his appeal commissioner, the Minister turned the corporation's appeal down. Then the Ministry's negotiators went into battle with the real licensing authority, the foreign government concerned. But the Italians said, in so many words: "You British have already got three airlines flying scheduled services between Britain and Italy— BEA, BOAC and Cunard Eagle—while we have only one. Now you are being greedy and asking for a fourth. BEA can operate the Genoa route, but not BUA." The Ministry of Aviation retaliated by limiting Alitalia's Genoa - London frequency from one a day to one a month, in one of the toughest (and incidentally least publicized) civil aviation restrictions ever imposed by the British Government on another. To crown it all, BEA promptly re-applied to the ATLB for a Genoa licence. The Ministry of Aviation have now got Genoa for BUA, but at a price. This price, possibly as much as £50,000 a year into the Alitalia-BEA pool, will come out of BOAC's pocket. Depending on how the traffic goes, the price could be less. The most optimistic informed guess is £15,000 a year. It is probable that BOAC are extremely angry. Why, they might reasonably ask, should we pay the fee for a British independent to operate a new route? Why not BEA? It would not be sur prising if BOAC were refusing to co-operate. So little is known about the private money-sharing terms of the pool agreements between BEA and BOAC on the one hand and between BEA and Alitalia on the other that there is no way of telling why it has to be BOAC and not BEA. The Italians have always been aggrieved that BOAC should remain outside the BEA-Alitalia pool, and this may be the reason why it is BOAC and not BEA whose money is being brought to Alitalia's book. An intriguing thought arises here: if BOAC have to pay £50,000 a year to Alitalia, does £25,000 go into BEA's till through their pool with Alitalia? Whatever the rights or wrongs of this situation, the remarkable fact remains that the Minister of Aviation has accepted the challenge of Genoa and made the British licensing system work. In doing so he has demonstrated that it is the British and not a foreign government which will designate what British airline is to fly a given route. More important, the Minister has resisted the pressure to use his traffic-rights powers to protect his corporations against the independents. Footnote Alitalia operated Caravelles on London - Genoa from May 15, and will build up to daily service in June. BUA will operate Viscounts, probably from early June.
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