David Learmount/LONDON

Privatisation of the UK air traffic control (ATC) system has been put back on the political agenda, with the year-old Labour Government mooting the sale of 51% of the Civil Aviation Authority's National Air Traffic Services (NATS).

ATC privatisation has been a running issue within UK politics and was first proposed - but later dropped - by the previous Conservative Administration. The privatisation drew heavy fire from the unions and Labour, then in opposition. The change of heart appears to be the product of the need to raise cash for the new Government's wider transport policy.

Transport minister Gavin Strang confirmed on 10 June that options are under study for "public/private partnership" for NATS. "Our preference is that 49% of the shares and a golden share are held by the Government, and 51% by private investors, including employees," he says.

Sale of the 51% could be through a stock market flotation or by a sale to trade partners.

The move would follow similar moves by others such as Germany, where ATC service provider DFS has moved to a stock market listing, or Canada, where services were acquired by a non-profit making consortium, including airlines.

The latest available figures from the CAA show that its NATS subsidiary made an operating margin of over 10% on sales of £509 million ($759 million) in 1996/7. Its assets are valued at £550 million in the CAA's books.

The concept of separating out traffic services from the CAA's regulatory role has received a warm welcome from the authority's chief, Sir Malcolm Field. "This is what we have been advocating for some time," he says.

Any NATS sale will still need primary enabling legislation, however, and pressure on parliamentary time is unlikely to allow this to be completed in much less than two years, he believes.

Source: Flight International