Civil Aviation (Consumer Protection and Regulatory Reform) Bill [HL]

Committee (2nd Day)

12:15:00

Northern Ireland legislative consent sought . Relevant document: 1st Report from the Delegated Powers Committee .

Clause 4Directions about implementation

Amendment 60

Moved by

60: Clause 4, page 4, line 27, at end insert— “(aa) after subsection (6) insert—“(6A) Where the Secretary of State makes a direction under this section, the Secretary of State must first—(a) consult persons likely to be affected by the direction, including communities in the vicinity of any airport or airspace affected,(b) undertake an environmental impact assessment in respect of the proposed direction, and(c) undertake a noise impact assessment in respect of the proposed direction.”;”Member’s explanatory statement This amendment would require the Secretary of State to consult affected communities and complete environmental and noise impact assessments before making a direction under section 2 of the Air Traffic Management and Unmanned Aircraft Act 2021. It seeks to ensure that the exercise of the direction-making power is subject to scrutiny and community engagement.

Earl Russell (LD)My Lords, it is a pleasure to start the second day in Committee on this Bill. I open this group on airspace modernisation, consultation and charging and move Amendment 60 in the name of my noble friend Lady Grender, as she is unfortunately unable to be here today.

The amendment is straightforward and seeks simply to insert a new subsection requiring that, before the Secretary of State makes any directions under Clause 4, three things must happen: a consultation with persons and communities likely to be affected; an environmental impact assessment; and a noise impact assessment. On these Benches, we feel that these additions are a basic requirement of legitimate decision-making where the power may have serious local consequences. The Clause 4 directions on airspace redesign are not merely a technical tidying-up exercise and can be used to alter flight concentrations, runway throughput, and the intensity and timing of overflight experienced on the ground. A ministerial direction made under this clause is capable, in substance, of facilitating additional capacity without ever being labelled as such.

As was said at Second Reading, the Bill is a blueprint; it is not the final product. It provides a framework that leaves the substance to future regulation. In that sense, as we have described, it is paving legislation. The Committee is entitled to ask what safeguards are built into that paving before being asked to drive on it. The Minister has given us reassurances that the Bill will not be used as a vehicle for airport expansion; we note and welcome those, and we accept them in the good faith in which they have been given. However, personal reassurances, however well-meaning, are not a legal safeguard. Ministers change, Prime Ministers change, Governments change, and interpretations can also change. The whole point of us seeking to put this duty into the Bill is to ensure that Parliament and the public can distinguish between a necessary operational change and one that, in effect, delivers additional capacity through the back door of airspace decision-making. Without mandatory consultation and impact assessment, the distinction cannot be realistically made. Even if it could be made, it would happen only after the fact.

Airport change proposals are already assessed through environmental methodologies, noise matrices and statutory directions. This should therefore be aligned with that pre-existing reality. For our communities, these matters are really important. Many, as we know, are already impacted by the noise and environmental impacts of existing airports, and future communities could be impacted by proposals under this legislation. These are real impacts on our communities, from noise late at night to environmental pollution. They should not have to rely on good will, however well-meaningly it is given. If the Secretary of State is to have this power, the Bill should state clearly what the procedural safeguards must be before it is used. That is exactly the point of Amendment 60. We are simply seeking to put a safeguard and some handrails in place around these powers. This is a crucial issue for us in our scrutiny of this Bill.

I turn briefly—I am sorry for speaking to these before others have managed to—to the other amendments in this group. In general, they all seek to do fairly similar things to Amendment 60. Amendment 61, in the name of the noble Lord, Lord Grayling, would require a minimum 28-day targeted consultation with local communities, local authorities and airport operators before any direction on airspace redesign is issued. We have considerable sympathy for this amendment, for exactly the same reasons that I outlined on our Amendment 60. The 28-day objective is not onerous; it is fundamentally achievable. We hope that the Minister sees fit to put our Amendment 60, this Amendment 61 or some combination of them into the Bill.

Amendment 62, from the noble Lord, Lord Tunnicliffe, would add the British Airline Pilots Association to the consultation list. We are broadly supportive of this amendment and recognise the central role that our pilots play, particularly in matters of safety. Their judgment and professionalism are essential in any plans to modernise our airspace and capacity. However, our concern is that the amendment, by its nature, names one organisation and does not, for example, name air traffic controllers. We would prefer it if the amendment was reworded to talk about consultation with representatives of the industry, as opposed to naming only one organisation.

Amendment 63, from the noble Lord, Lord Holmes of Richmond, would require the CAA to establish a blockchain-based audit trail for every airspace change program. We recognise that the underlying objective and purpose of this is to create a tamper-proof, long-term record of what has been decided, by whom and when. That is an entirely legitimate concern. In the past, too many of these decisions have been opaque; it has been extremely difficult for anybody to know what has been happening and what has been done by whom.

The requirements in this amendment, particularly those in proposed new subsection (3) for cryptographic security, 15-year retention and tamper-proof records, are all laudable aims, but we wonder whether naming one specific technology would make this a hostage to fortune in the future. We suggest alternative wording that asks for a secure, auditable and publicly accessible record, without prescribing the exact technology to be used. We feel that that would be a better way forward. It might be that the technology that the noble Lord suggests is the one that is chosen, but alternative wording would at least leave more scope for examination in the round.

Amendment 64, from the noble Lord, Lord Moylan, probes with characteristic precision the rationale for allowing changes to be imposed under Clause 6 on persons who neither use nor benefit from the air traffic services in question. This is a serious point: the Bill should have open scrutiny of who bears the costs for these matters. I hope that the Minister can provide some clarity on those points.

The final amendment in this group is Amendment 65, from the noble Lord, Lord Kirkhope. It would require the Secretary of State and the CAA to have regard to the growth and sustainability of general aviation when setting charges and to ensure that charges on general aviation users are proportionate to the use that they make of air traffic services. General aviation is too often forgotten, and this seems a proportional requirement and a modest and reasonable ask. We look forward to the Minister’s response to it.

Lord Grayling (Con)My Lords, I am grateful to the noble Earl, Lord Russell, for his comments on my Amendment 61. I will speak to it only briefly, because it is pretty self-explanatory.

The legislation rightly gives some power to the Government to intervene and, in effect, act as arbiter when it comes to airspace redesign. Airspace redesign has taken much too long. It started when I was Secretary of State and now, nearly eight years later, we are still not close to bringing it to fruition, yet it is fundamental to the future of the aviation sector in this country. It will unlock extra capacity and use next-generation technology to enable us to provide more respite to communities that are affected by aircraft noise, even though the level of aircraft noise, in the world in which we live, has dropped enormously over the past generation. The Government rightly believe that they need some degree of arbiter powers in this, but I do not think that they should have those powers just to say, “Right, that’s the decision”. There is an obligation there—nothing at great length, because we know that government consultations can last for ever, take months to be responded to and all the rest, but with a simple process saying, “Look, that’s what we’re going to do. Is there anything we haven’t thought of? Is there something we’re not quite getting right here?” I say to the noble Lord, Lord Tunnicliffe, that the wording of the amendment is what it is, but I would expect pilots’ organisations, air traffic organisations and all the rest to be able to input a view on this point.

I would see this as being not an isolated consultation but a standard government consultation—a short, snappy one—simply so that the organisations and communities that have a vested interest can come forward and say, “There’s something you haven’t thought of. This is going to have an adverse effect that you haven’t thought about. You really shouldn’t be taking this decision”. It would be improper for that process not to exist where the Government have what is, in effect, a pretty absolute power of direction under the legislation as it is at the moment. I very much hope that the Minister will take that on board and perhaps look to include something of this kind on Report.

Lord Tunnicliffe (Lab)My Lords, I shall speak to Amendments 60 to 62; I express a specific concern in my Amendment 62. I thought that I knew about the technology in this debate until I decided to brush up on it yesterday; I have spent most of my working hours since then getting up to date, to some extent.

The essence of the technology, which would allow a much more holistic review of airspace use, is that it is dependent not on aids on the ground but on global positioning systems. That gives great benefits, in terms of what it does for aviation, but I put it to the Committee that it also gives great benefits to those who are concerned about the environmental impact. If your route does not fit with that bit of society and there is a route that can fit with that bit of society, then, with the overarching technology, it can be changed. Up to this point, changing where aeroplanes go close to the ground has been totally dominated by the ground-based aids that they use to land.

The essence of my amendment—as an ex-BALPA shop steward, I thought that I had better represent my old team—is to get pilots involved in this consultation. They are going to face dramatic differences. One of the first things that I would say relates to the point that the noble Lord, Lord Moylan, made the other day, which is that the planes can fly themselves. Normally, you have to drag the plane into the air then tell it to fly itself, and, when you get to the end, you actually have to make a few decisions. It is a very good theory; hopefully, when you press “flight nav” or something like that, that will happen.

The problem facing the modern pilot is that one of their most important tasks is to cope when there are system failures. There will be system failures. There are no big computer systems in the world that do not have system failures, as we all know to our cost. The problem is that the level of knowledge needed by the operative to cope with a system failure is very large but it is not often practised. It will, I am sure, follow the pilot’s standard of continuous checking. I have never flown an airplane with its engine on fire, but, when I was an airline pilot, I flew a plane with its engine on fire many times in a simulator. It was dramatic and great fun, but the whole essence here is that the systems delivering this will intrinsically and inevitably have failure modes early on. The crew are there to look after that, among all the other safety issues that they have to care about.

All the literature on the impact on pilots of a very different system says that it will require if not an almost completely new licence then certainly a substantial licence endorsement to equip pilots to look after these systems. How can their views and their wisdom be taken into account? They are the only people who can envisage the situation, together with a very dramatic change in standards.

12:30:00

Broadly speaking, if you are flying a jet airliner, you do not see any other aeroplanes because the systems keep you that far apart. These new systems are designed to let aeroplanes fly safely but nevertheless much closer to one another. That is a key area of safety concern. We have to get right the interface between the human beings on board an aeroplane, the aeroplane and the routers, and only pilots can have that input. There will be some differences in the worlds of air traffic controllers and so on but, broadly speaking, their loads will be lightened because the routings of the aeroplanes will have been predetermined in setting up the system.

I am told that BALPA represents 85% of all pilots, so it is a useful shorthand. I am sure that advisers to the Minister will tell him that it is inadvisable to include a specific group, but I am sure we can find some words. Pilots need to be in that consultation. I take the point of the value of a short consultation but, inevitably, because this will be so new, it will affect people on the ground in different ways, so there must also be some capability for ongoing consultation so that responsible bodies with the power to change things have to listen to users, people on the ground and operators.

Lord Holmes of Richmond (Con)My Lords, I will speak to my Amendment 63. I thank the noble Earl for the excellent way in which he introduced the group and covered the amendments with such eloquence. This is a very straightforward amendment whose purpose is clear: to have an immutable cryptographic record of such important decisions. I agree entirely with the noble Earl. The blockchain reference is merely illustrative but it also shows the unfortunate speed that I was flying at when I was drafting. I would like to have set out criteria that any technology would need to meet to achieve the objectives in the amendment. That was the approach that we took in the Electronic Trade Documents Act, for example, when we specified no particular technology but set out a series of criteria that any technology would have to meet to be able to perform the task. If we can import that into our considerations of this amendment, that would get us pretty much to where I am at. The point is that blockchain would more than suffice for the task. There is obviously a difference between blockchain and distributed ledger technologies, which we do not need to go into at this stage, but there are technologies that have not even come to fruition, never mind to a level of usability at this stage, which almost certainly will have a part to play in such illustrations as this. It is critical, though I failed in this amendment, to have technology neutrality, because through that technology neutrality you give yourself the best opportunity of having technology future-proofing. If the Minister could respond with those thoughts in mind, which are in the text but I wrote them in white ink on a white page, I would be obliged.

Lord Kirkhope of Harrogate (Con)In proposing Amendment 65, I must declare again my interests as set out at Second Reading. I have held a private pilot’s licence for about 40 years now. I am an officer of the All-Party Parliamentary Group on General Aviation, and I am the author of its inquiry into our lower airspace that was conducted a year or two ago. I am honorary vice-president of the British Airline Pilots Association and a former airport director. In a way, I am looking at this subject from rather more than one perspective.

At Second Reading, I pressed the Minister on Clause 6, and, in particular, on the change it makes to who must pay for air traffic and air navigation services from

“operators or owners of aircraft”

to simply “persons”. I asked what lay behind this decision and whether it was prompted by newer developments such as drone delivery, and at that point I referred to the Minister nodding his head. I am afraid that perhaps I was taking too much on in assuming that the nod related to my remarks—I make no aspersions otherwise. I said then that the burden on general aviation ought to remain broadly where it sits today.

This amendment would require the Secretary of State and the authority in exercising their functions over these charges to have regard to two matters: the growth and sustainability of general aviation, and the desirability of ensuring that those carrying out general aviation activities do not pay charges disproportionate to the use they make of the services. Many of my colleagues here who have spoken earlier in these debates have indicated their interest in general aviation, so there are quite a lot of us around, but it is important that I explain to the Committee that general aviation means civil aviation other than commercial air transport. It includes gliders, light aeroplanes, microlights, and the private and training flights of which I spoke earlier. It is not airlines and it is not, as I shall come to say, drones. On the Government’s figures in their general aviation strategy, the sector contributes, they accept, something in the order of £3 billion in gross value added and supports some 38,000 jobs. It is around 1/14th of the size of the commercial airline industry.

The figure I ask the Committee to hold in mind is that a great majority of those who sit at the front of the airliners that this Bill is chiefly concerned with—by some estimates three-quarters or more—began in general aviation, very often paying for their own training at the small flying schools the regulator knows as declared and approved training organisations. Those same schools and that same flying give us our future air traffic controllers and aircraft engineers, as well as those who pilot light aircraft. With Boeing and Airbus alike forecasting a need for several hundred thousand new pilots around the world in the years ahead, this is exactly the wrong moment to make it more expensive to learn to fly. From my involvement with the British Airline Pilots Association, I can tell the Committee that the profession, as was referred to earlier by the noble Lord, Lord Tunnicliffe, watches the health of general aviation closely, for it is from there that the profession is renewed.

I will mention drones, for I suspect they lie close to the heart of the change. The Government have been candid that the Bill is needed in part because of new users of the air—the drones and the air taxis that will follow. I do not quarrel with that. Those users will make real demands on a future digital airspace and it is fair that they should pay their share, but the drone is not general aviation. They are governed by a separate code altogether in the air navigation orders and the unmanned aircraft regulations, in their own open, specific and certified category. My concern is that, when one widens the net from the owner and operator of an aircraft to any person, one catches the drone operator one is aiming at but one may also catch the local gliding club.

The danger is of a single standard designed for the commercial airliner being pressed on everyone, bringing cost and complication to those who fly small and simple aircraft—not always terribly simple, I might add. A glider under tow or a training aeroplane in the circuit draws on a fraction of the air traffic services that an airliner consumes or, for that matter, a fleet of delivery drones one day will. The charge each meets should reflect that and no more. There is a related point that it can hardly be right to levy a charge on a person who does not use and cannot use the very service being charged for. That is the principle behind this amendment: that those who make little use of the system should bear little of its cost.

I want to be clear about what I am not asking. I am not asking that general aviation be exempted from all charges. It pays its way today and it should continue to do so. Nor am I seeking to frustrate the much-needed programme of modernisation that, rightly, this Bill provides for. I supported its general objectives at Second Reading and continue to support them now. I ask only that, as these powers are set out in greater detail, the interests of general aviation are kept in view and the principle of proportionality is clearly set out, rather than left to assurances by the Secretary of State.

If the Minister can tell me that the Government have no intention of drawing general aviation into a charging regime built for the airlines or for commercial drone activity, and that he will consider how that intention might be given proper statutory form, that would be enormously welcome.

Baroness Bray of Coln (Con)My Lords, it is a pleasure to follow the noble Lord, Lord Kirkhope. I support the proposal from the noble Lord, Lord Grayling, of a targeted consultation with local communities. It will surely be the case that, as part of the civil aviation Bill, there will be changes to the use of airspace overhead and the potential not only for increased numbers of flights but the redesign of flight paths and expanding airports. It must surely follow, then, that, as part of the planning and preparation for these changes, residents who may experience new aircraft overflights, increased noise and other meaningful impacts, such as increased traffic on roads leading to local airports, should be given a meaningful role in considering these changes.

It is already the case that government and CAA policy recognises that airspace changes can have significant impacts on people on the ground and therefore includes consultation and stakeholder engagement requirements, but that sometimes feels a little like a box-ticking exercise. I feel strongly that it must be more than that. Communities that may find themselves under new or intensified flight paths deserve a meaningful voice in these decisions that seriously affect their quality of life.

I recognise that the updating of our aviation policies is an essential process from time to time, but surely the best outcomes are achieved through reasonable discussion. A stronger consultation framework may well deliver reforms more smoothly and avoid delay in being implemented, which can arise where opposition intensifies. Whereas existing consultation processes are often seen as insufficient as they take place too late in the process after key decisions have already, in effect, been made, proper engagement with those affected at an earlier stage and a clear demonstration of how their views are being considered is more likely to appear proportionate and pragmatic.

I am not suggesting that communities could or should have a complete veto over necessary airspace changes, but it would help ensure that residents who may experience substantial increases in overhead flights are fully consulted earlier and can see how their concerns are being taken into account. The key may be to introduce formal reviews of new routes after a year or so, independently conducted, and a commitment to revisit the design if impacts prove worse than forecast. The most defensible demand is surely a requirement that decision-makers must demonstrate how community representations have been considered and explain publicly why particular concerns were accepted or rejected.

Yes, residents already have consultation rights in relation to airport expansion and airspace changes, but they are limited and there is no guarantee at the moment that community concerns will materially affect the outcome. The issue is not whether consultation occurs but whether it is meaningful. Communities facing substantial increases in aircraft noise should have a guaranteed opportunity to influence decisions and receive a clear explanation of how their views have been taken into account.

12:45:00

Viscount Goschen (Con)My Lords, I start by repeating my interest, which I declared on Tuesday, as a current pilot, aircraft owner and operator. On Tuesday, we had a good debate around general aviation, when my noble friend Lord Kirkhope and others took pains to explain the benefits not only to the economy, through the contribution that GA makes, but the broader aviation ecosystem, as it were, particularly in pilot training. Anything that is done to reduce opportunities for pilot training in the UK will have an easy to define effect, which will be the export of pilot training to Europe, where some countries have a different regime and much better weather, the United States and elsewhere. We have to regulate and legislate carefully; the law of unintended consequences is very active in this field.

Access to airspace is critical to the operation of general aviation. I refer to and support my noble friend Lord Kirkhope’s Amendment 65 in both of the thrusts that it seeks to take forward. First, it would protect the importance of GA when it comes to decisions being made around airspace design. It would be easy for the interests of general aviation to be minimised or not taken fully into account, and once decisions are taken it is very difficult for them to be reversed. Yes, much of the country is open, class G airspace, but there are real pinch points and that situation is likely to become exacerbated, rather than made any easier. One example would be around the area of Farnborough, which is close to the London airspace around Heathrow and so forth. I therefore plead for the interests of GA to be considered properly in the design, or redesign, of airspace.

Like my noble friend Lord Kirkhope, I recognise the technological advantages of change that is coming so rapidly. It is difficult for us now to be able to consider what life is going to be like in five years’ time. We support all the advantages that can come from that, including the safety advantages. When I was training as a pilot, one of the biggest concerns was getting lost. It took up quite a lot of my time thinking where one was, particularly in less than perfect weather. Nowadays, with GPS systems, you know precisely where you are at all times. That has taken away one of the excuses, but the safety benefits are extraordinary, and they will continue to come, as the noble Lord, Lord Tunnicliffe, said. I flew an aircraft with a big orange button on the front. If you pushed the button, the aircraft could land itself should the pilot become incapacitated. It was way beyond my knowledge and expertise, and I would not be allowed anywhere near such a machine now. The point is that that technology exists today.

The reasonable points that my noble friend made around charges were not special pleading in any sense. He is saying that the charging regime has to be proportionate; it really is as simple as that. There have been issues in the past. I took pains in my remarks on Tuesday to pay tribute to the CAA, but sometimes the cost, for example, in giving approval to small general aviation airfields that are regulated as full airfields can be disproportionate. It is a system that would suit a much bigger airfield and the result is that the airfield in question is no longer regulated, because it is much easier to move to a deregulated situation. However, that has implications for training and what can be done in such a field. What we are saying is this: be cautious and careful, and take into account the advice and interests of what really is the grass roots of aviation, which has been a major part of our success as a nation in the broader aviation industry. Amendment 62, from the noble Lord, Lord Tunnicliffe, is on the importance of hearing the professional pilot’s voice. I would be very surprised if any consultation did not take into account the views of those who know what they are talking about on large-scale commercial aviation. Exactly how that should be done and the mechanism for it I will leave to others to decide and opine on, but the noble Lord gave a powerful voice to BALPA, as we heard on Tuesday.

In recollecting the discussions around BALPA, I remember our late and much missed colleague Lord Clinton-Davis, who was a powerful advocate for BALPA. I spent many happy hours at the Dispatch Box with him as opposition spokesman in this field, and indeed he was earlier a Minister.

This has been a balanced debate and we very much look forward to the Minister’s response.

Lord Harper (Con)My Lords, I repeat my declaration of interest that I made on Tuesday as the non-exec chair of RVL Aviation.

I will say a word or two about the amendment from the noble Lord, Lord Grayling, and strongly support what he and the noble Baroness, Lady Bray, said. I wanted to ask the Minister to flesh out a bit the answer to the question that I asked at Second Reading. There are already consultation processes, as the noble Baroness, Lady Bray, mentioned. There is no specific one for the exercise of the direction power. I am keen that, if there are extra processes, they fit well together; we do not want one set of consultations at one stage and then, if the Minister decides to do some direction, another set. When the Minister responds and, I suspect, urges the noble Lord, Lord Grayling, not to press his amendment, I would welcome a clear exposition of how the current position works, how it would dovetail with any use of the power of direction that Ministers are taking in Clause 4, how they would expect to use it and how that would fit with the existing consultation mechanism. I am keen that we do not invent another consultation mechanism.

If that power of direction is taken and is used—although the Explanatory Notes say that they do not expect the Government to use it very much, as it is a backstop power—it is almost certainly going to be used in difficult or controversial circumstances, because it would not be needed otherwise. That is the position set out in the Explanatory Notes. It would be helpful to understand how that end-to-end process works. It may be that the Minister should come forward with an amendment on Report that sets out how the power would be used and consulted on, or at least how it will dovetail with existing consultation mechanisms. I am not clear about how that would currently work.

Finally, I back up the remarks made by the noble Lord, Lord Kirkhope, and the noble Viscount, Lord Goschen, about the charging mechanism. I want to set out some of the views from the International Air Transport Association. IATA strongly supports, as I do, and welcomes the Government’s intention to do airspace modernisation but has concerns about the charging regime. It thinks that the drafting is too broad and ambiguous, and risks undermining the international charging principles that exist. IATA is also concerned—a concern shared by the noble Lords, Lord Kirkhope and Lord Moylan—about replacing the words

“operators or owners of aircraft”

with the undefined “persons”. It thinks that that significantly expands the pool of liable entities and breaks the link with service provision. It understands the need for flexibility for future entrants but think there should be a narrower definition that encompasses those but is not as broad as the one that exists.

IATA is also concerned about revised Section 75(7), which allows charges to be levied on the basis that services are merely

“available for use or benefit”,

irrespective of the actual use. That represents a fundamental shift away from usage-based charging, which is the agreed international regime.

IATA has a number of concerns, not about the principle of what the Government are doing. It recognises that there will be new users and technologies, and the need to change how charging is done, but there are some accepted principles about the user paying for these things. As the noble Lord, Lord Kirkhope, and the noble Viscount, Lord Goschen, said, that should be done proportionately, but it is not sufficiently backed up by the broad wording in the Bill as currently set out.

It would be helpful if the Minister could say what the thinking was behind the drafting; whether the Government agree with IATA’s views about whether the Bill is in accordance with existing principles; and whether the Bill would be improved by a tighter definition that absolutely encompassed new technologies such as drones and other potential things in the future but was not so broad, and explicitly reintroduced the link between the usage of airspace and the charging, rather than simply the theoretical benefit. The Bill would be improved if those changes were made, and I look forward to the Minister setting out the Government’s thinking about how its wording was arrived at.

Lord Empey (UUP)My Lords, there are some positive amendments in this group. Amendments 60 and 61 are trying to get to the same place. If there are new arrangements for the management of airspace, that is code for motorways in the sky. But it also means that if there are new routes or a material intensification of a route, it is only right and proper that local people are consulted about it, because it can have a significant material impact on their lives.

Where perhaps the noble Lord, Lord Grayling, has the essence of the matter is that he specified a time. We could argue about whether 28 days is right, but the fundamental principle that he is pointing out is that consultations can be endless and open-ended and never reach a decision. Something needs to be put in to tie it down, provided consultees have adequate notice and there is an understanding. It is a bit like neighbourhood notification and planning applications. There are specific groups of people who need to be approached about this: the people over whom these aircraft will be flying, and those affected by other intensification activities, whether traffic or whatever. The amendment of the noble Lord, Lord Grayling, gets to the essence of this. Whether we settle on a specific number of days is another matter, but the principle has to be established.

I agree with the principle of the amendment of the noble Lord, Lord Tunnicliffe, but I also accept that it would be inappropriate to specify a particular trade union, because they may change. There are pilots represented by other unions and some represented by none. That could change over time. If you specify the union in your legislation, that would be awkward. As the noble Lord said, we can find a form of words but the principle is the same. However technology may change, having air traffic controllers in the frame for that is common sense. These are the people who, day to day, have to do it. Also, as has been made clear, computer systems break down. We had a long debate on Tuesday over NATS and the breakdown there. The noble Lord is right. Pilots earn their money when the systems do not work, which is a regular occurrence.

By and large, there are some positive amendments in this group. However, I say to the noble Lord, Lord Tunnicliffe, that I would not specify a particular trade union. Other than that, I support these amendments. There are some positive ones.

13:00:00

Baroness Pidgeon (LD)My Lords, this is an important group of amendments, and this has been a useful debate. It goes to the heart of what the Bill could enable and the safeguards clearly needed to protect communities that will be impacted by any changes to airspace use. As my noble friend Lord Russell outlined, Amendment 60, in the name of my noble friend Lady Grender, would put those guardrails in place. It would require the Secretary of State to consult affected communities, alongside making environmental and noise impact assessments, before being able to make a direction. This is critical. As we know, altering flight paths and redesigning airspace will have a significant impact on a surprisingly large area, as those communities impacted by the existing Heathrow and Gatwick airports, for example, are only too aware. A Secretary of State must understand the impact on people, noise and the environment of any potential decision. It is an important part of the decision-making process.

I understand that the Minister has given assurances that the Bill is not intended as a vehicle for airport expansion, but that is not a legal safeguard, as my noble friend Lord Russell outlined. Putting a duty in the Bill would ensure that Parliament and the public can distinguish between a necessary operational change and a change that, in effect, facilitates additional capacity without the transparency that would accompany a normal expansion decision. Without mandatory consultation and that impact assessment, there is a real risk that expansion could be delivered through the back door. This amendment matters to residents under the flight path, including communities such as those in Richmond, Kingston and Hounslow. They already live with the consequences of aircraft noise and emissions. If the Secretary of State is to have this power, the Bill must clearly specify procedural safeguards.

As we have heard from noble Lords, the other amendments in this group test the same principle of whether airspace modernisation is being carried out in a transparent, accountable and proportionate way. We are sympathetic to their aims as detailed by my noble friend Lord Russell. I am rather nervous about the noble Viscount, Lord Goschen, getting lost in the sky, as he said earlier. I am very grateful that we have modern navigation systems these days. If we are to redesign our skies, we should not do so in a way that leaves people on the ground with less say, less information and fewer protections than we had before. I look forward to the Minister’s response.

Lord Moylan (Con)My Lords, I am impressed by the enormous experience of aviation and ministerial responsibility for aviation present in the Committee. I do not claim either, but I will do my best to respond to this group. First, I say that we support the principle of airspace modernisation. If we have a complaint about it, it is that it is taking so long. If it needs legislation, why is that legislation is arriving only now, seven years after it started? The Minister might explain that and what sort of timetable he is expecting to pursue with airspace modernisation.

The Bill gives the Minister new powers of direction that are extremely broad, and that is the basis for most of the complaints and concerns—I think concerns rather than complaints—expressed in the Committee so far. They are very broad powers of direction and are almost unconstrained. I think it fair to say that no part of the Committee believes that those powers should be unconstrained. We believe that there should be processes that allow for consultation and accountability. Indeed, one could even argue that it would be more appropriate than giving directions for the Secretary of State to have to have recourse to a statutory instrument. That is not an amendment that has been proposed today, but it would be one way of addressing the Committee’s concerns.

I will briefly deal with the amendments. Both Amendment 60, in the name of the noble Baroness, Lady Grender, and Amendment 61, in the name of my noble friend Lord Grayling, seek to impose a consultation requirement of a general character on the Minister. I do not think that that can be gainsaid; the Minister will have to agree it in one form or another. If he cannot give us assurances today that he will bring forward an appropriate amendment on Report, I very much hope that the noble Baroness and my noble friend will work together to draft an amendment that we can all rally behind.

Amendment 62 is in the name of the noble Lord, Lord Tunnicliffe. As at Second Reading, I found his speech most enlightening and interesting. I will make a small diversion to comment on it in a moment. However, the general principle is whether pilots—either through their trade union or in some other forum, as he said—should be consulted, and consulted specifically and early, about airspace changes. The answer is surely that they must be, since, as he explained—I do not need to repeat it—their stake in the business and activity is so high and so responsible that they should of course be involved in consultation at an early stage.

I will comment briefly on the broader question raised by the noble Lord of how this system works. We are seeing automated systems very much on the railways and certainly on London Underground—I know the noble Lord has great experience in rail and not just as a pilot—and in the motorcars with gubbins on the top that one now sees around the streets, driving themselves but with a driver present. The essential point of all these systems is to get them to drive closer together. They will drive closer together more safely under these automated systems. Take the example of the Victoria line, where the trains come practically every 90 seconds: that would not be possible if there was a human driver responsible for stopping and starting, because they would need to make judgments about how to do that.

The crucial difference—here I support the noble Lord—with ground-based systems such as railways, and, I assume, cars, is that the fail-safe if something goes wrong is to bring the system to a total stop. You can do that on a railway; you can just stop it, so that no train moves until you work out what has gone wrong and how to put it right. That is the safety mechanism. You cannot do that in the air, so our approach to aviation safety has to be very different. The input of pilots must be crucial to all of this. If, in the absence of an amendment from the Minister, one were to come forward from the noble Lord that expressed that—although not necessarily in these words, but if he could show himself open to adaptation—we would be very happy to support it.

My noble friends Lord Kirkhope and Lord Goschen spoke about the importance of general aviation. I am happy to second that for all the reasons they gave on both its economic contribution and its role in being a feeder to the skills necessary in the larger commercial aviation sector.

I will focus particularly on what my noble friend Lord Kirkhope said about charging and turn to my own Amendment 64, which is on just that point. There is a striking new subsection in Clause 6. It says:

“Persons may be specified (or of a description specified) if the services concerned are available for their use or benefit, and it is immaterial whether or not the services are actually used or could be used by, or actually benefit or could benefit, them”.

There is something of a contradiction written into that, because they would have to meet both limbs of the test. The first limb says that they

“are available for their use or benefit”.

The second limbs says, “Well, they could not be used by them and could not benefit them”. How can they be available for their use or benefit on the one hand and it still be the case that they could not be used by or benefit them and are still chargeable? I hope that I have expressed that correctly but, if noble Lords read the clause carefully, they will see that that is what it says. It says that they have to be available for their use or benefit but that it is immaterial whether they could use them or benefit from them. That seems like an obvious contradiction.

Introducing the word “persons” obviously requires some explanation. I am sure that the Minister is going to give it. I suspect that the explanation might be along the lines of the fact that there are drones and other things in the skies now, not simply aircraft. If that is the explanation, it has to deal with the clear point made by my noble friend Lord Kirkhope of Harrogate, but I am a little more relaxed about that. What I am not relaxed about is being asked to give the Minister the power to levy charges on people who could not use or benefit from the services in question. As it stands, this clause shows every sign of being hastily and poorly drafted. One would hope that the Minister would come forward on Report with improved drafting, but, if not, I suspect that there will be an amendment to deal with it.

It is fair to say, in these happy circumstances that have arisen, that the whole of the Committee is united on nearly all of the points we have debated in this group. I very much hope that the Minister will be able to join that circle and not disrupt the unanimity that the Committee has so fortunately achieved.

The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab): My Lords, I am grateful to noble Lords for their thoughtful contributions on this group of amendments. Although I rarely seem to agree with the noble Lord, Lord Moylan, I do so now in admiring the depth of aviation knowledge in this Committee today.

I will respond to the points that have been made and set out how the Bill enables progress on essential airspace reforms while maintaining the appropriate safeguards. I will start with Amendment 60, which was introduced by the noble Earl, Lord Russell, and the comments from the noble Baroness, Lady Pidgeon. It will be convenient for me to address Amendments 61 and 62, in the names of the noble Lords, Lord Grayling and Lord Tunnicliffe, respectively, and to note the comments from the noble Baroness, Lady Bray of Coln.

I assure all of them that environmental assessments and consultation are, and will remain, a fundamental part of the airspace change process. Let me be clear at the outset that nothing in these powers removes or weakens the existing requirements for thorough consultation and robust assessment of environmental and noise impacts. The Bill will extend the Secretary of State’s existing powers under the Air Traffic Management and Unmanned Aircraft Act 2021. It allows her, if needed, to require the implementation of an approved airspace change. For the avoidance of doubt, that means an airspace change proposal that has already been properly developed, consulted on and approved.

The powers introduced by the Bill do not circumvent the existing requirements built into the airspace change process, and any proposal must first go through the Civil Aviation Authority’s CAP1616 process. This requires the sponsor of an airspace change to undertake detailed assessments of the potential impacts of flight paths, including noise exposure and greenhouse gas emissions. Sponsors must hold meaningful consultations on the proposals with affected communities and other stakeholders, including airspace users or groups representing them, and, where appropriate, with pilots and those who represent them. These assessments must be rigorously scrutinised by the Civil Aviation Authority before any proposal can be approved. Where a change is taken forward by the UK Airspace Design Service, it will work closely with airports, in line with the bespoke partnership agreements.

13:15:00

In answer to the point from the noble Lord, Lord Moylan, about the timescale for the UK Airspace Design Service, the set-up is now complete and beginning to bring on board the existing airspace change proposals for London. One of its first priorities is to develop a realistic delivery plan for modernising London’s airspace, and those changes are expected to be delivered in the 2030s. Given their scale and complexity, they may be delivered in stages, and some elements of airspace modernisation for the rest of the United Kingdom are expected to be delivered earlier.

The powers of direction introduced by the Bill therefore come into play only after all these steps have been completed. I welcome the support from the noble Lord, Lord Grayling, for the aim to ensure that the benefits of a properly approved and strategically important airspace change cannot be held up by a single reluctant party. These amendments, while well intentioned, would duplicate existing requirements, introducing unnecessary delay and costs. They would undermine the delivery of approved airspace changes, which themselves deliver major benefits relating to delays, emission and noise. I note the comments from the noble Lord, Lord Empey, on this issue.

Lord Grayling (Con)May I just ask a specific question? If we countenance the situation where, for example, a plan coming from Heathrow to amend the routes into that airport clash with the routes into Farnborough and it has been through extensive process and, effectively, there is a logjam where one says one thing and the other says another, my understanding is that the Government, using their direction power, can say, “Right, we vote for Farnborough, not Heathrow”, or vice versa. In that situation, where the Government say they are voting for Farnborough, is there still a duty to consult on that decision before it is implemented?

Lord Hendy of Richmond Hill (Lab)I will take some advice and respond further. But I note in response to the comments from the noble Lord, Lord Grayling, that both proposals will have been consulted on and agreed, so it is not the case that consultation would not have applied to either of them. I will write to him with the precise answer to his very reasonable question and copy it to other noble Lords.

Amendment 63 is from the noble Lord, Lord Holmes of Richmond, and he is right that information about airspace changes should be secure and transparent. I take the noble Lord’s point about the choice of technology. The Civil Aviation Authority’s CAP1616 airspace change process is designed to ensure transparency throughout. There is already a legal requirement for directions related to airspace change to be published, as well as any steps the CAA takes to enforce them. In addition, both the sponsor of an airspace change and the CAA are required to publish relevant documentation throughout the process, which is held on the CAA’s airspace change portal—a secure platform which acts as a single source of truth. When an approved design is implemented, it is published in the UK Aeronautical Information Publication, as required by international law. This is not an area where there is a lack of trust or accountability requiring a more complex or novel audit mechanism. The CAA operates within a well-established statutory framework with clear oversight and requirements for publication and traceability. Introducing a requirement to store this information in a prescriptive or novel format risks adding complexity without corresponding benefit, given that the core objectives of transparency, accessibility, and auditability are already being met. It would also apply irrespective of any identified gap, creating additional cost and rigidity on how information is managed, so I respectfully ask the noble Lord not to press his amendment.

Amendment 64 from the noble Lord, Lord Moylan, relates to a technical change arising from the proposed expansion of who can pay charges for air traffic services, which will ensure that the “user pays” principle can continue to be fairly applied in future. Air traffic services are provided for all users within a block of airspace. Even when an airspace user does not use a service directly, they may still benefit from it. For example, if two aircraft avoid a collision because one is directed away from the other, both benefit even though one did not directly receive the service.

It is right that the charging framework reflects this. The Bill does not say that charges may be imposed on persons who cannot use or benefit from them. We reassure noble Lords that charges are not set without safeguards and that the Bill maintains them. The Civil Aviation Authority accounts for factors such as efficiency and proportionality and follows an established process, including extensive engagement, statutory consultation and rights of appeal.

A requirement to prove the precise level of use or benefit for every airspace user would be disproportionate and unworkable, particularly as an increasing number of emerging uses, especially drones and other unmanned aircraft systems, are integrated into shared airspace and require air traffic services in future. That issue is what the existing provision is designed to avoid and what the changes in the Bill seek to maintain. For that reason, I ask the noble Lord to withdraw his amendment.

Lord Moylan (Con)The Minister says that the Bill does not say that you can be charged if you cannot use the service, but that is precisely what it says. It says that

“it is immaterial whether or not the services are actually used or could be used by, or actually benefit or could benefit, them”.

I do not think it is logically coherent, because they have to be available to them to qualify on the first limb of the clause.

It may well be that the noble Lord has the intention he expressed at the Dispatch Box. However, I ask him whether he considers this clause to be drafted to articulate that intention. As it stands, it seems internally self-contradictory. But if it is not internally self-contradictory and he can prove that it is not, I would still object to people being charged for services that they could not use or benefit from.

Lord Hendy of Richmond Hill (Lab)In those circumstances, I will take away the noble Lord’s very detailed point and attempt to either explain why it does what I said, or alter it so that it does what I said. Finally, I will address Amendment 65 from the noble Lord, Lord Kirkhope of Harrogate. I also listened carefully to the noble Viscount, Lord Goschen, on this subject. As experienced pilots themselves, they know better than most that general aviation is an important part of the UK’s aviation industry, covering a wide range of public service, commercial and recreational activities.

Clause 6 seeks to provide the Civil Aviation Authority with greater flexibility as to who can be charged for air traffic services provided under a licence. This will ensure that, as the UK’s airspace evolves, the cost of providing those services can continue to be recovered fairly and proportionately, in line with the user pays principle. I note the replication of the IATA view on this from the noble Lord, Lord Harper, and I will take that away.

As noble Lords will be aware, these costs are currently recovered primarily from commercial airlines as they are the main users of the relevant services. General aviation is largely exempt. The noble Lord is right that we do have in mind drone operations on operators and other unmanned aircraft. Ahead of any changes in future, the CAA has a statutory duty to consult on its proposals. Those whose interests are materially affected by its decision could appeal if they considered they had grounds to do so.

The CAA already has an obligation under the Transport Act 2000 to further the interests of operators and owners of aircraft, including in relation to the availability and cost of licensed air traffic services. This includes any that might be classed as general aviation to the extent that they are affected. Given this duty, the thorough and well-established processes for setting charges and the fact that there is currently no plan to create a new charge for general aviation users, I ask the noble Lord not to press his amendment.

Earl Russell (LD)My Lords, this has been a really interesting and informative group. I know that we have spent a bit of time of it, but it has been time well spent in understanding the Bill. Four key points have come up. There is the whole issue of the need for modernisation, and the fact that it can provide environmental as well as safety benefits, but also the sheer complexity of doing that. Obviously, the powers given to the Minister under Clause 4 and the need for guardrails have come up as well and, as the noble Lord, Lord Moylan, said, there is consensus in Committee on the concern around those issues. There is the need for consultation, where I thought the noble Baroness, Lady Bray, put it really well; that needs to be meaningful. Finally, there is the issue of general inclusion and the Bill’s impacts on general aviation.

I am forever thankful to the Minister for his care and attention to these matters. We welcome his response on Amendments 60, 61 and 62. It is fair to say that we will reflect on his exact words and have a look at Hansard . These matters are complex and I welcome the words he has given. I am not certain, as I speak here, whether they will be enough or whether we will need to look at drafting a joint amendment on those matters. In any case, I am sure that we can have further conversations prior to Report on those issues. I also note the Minister’s comments in relation to Amendment 63 and welcome the response from the noble Lord, Lord Holmes, about having the purpose rather than the technology as the vehicle. Again, we need to reflect on some of the Minister’s response around the risks. I note the reassurance that he gave about the CAA as a single source of truth and the systems already in play. With that, I beg to withdraw my amendment and thank noble Lords for the debate we have had.

Amendment 60 withdrawn.

Clause 4 agreed.

Amendments 61 to 63 not moved.

Clause 5 agreed.

Schedule 2 agreed.

Clause 6Charges for air traffic and air navigation services

Amendments 64 and 65 not moved.

Clause 6 agreed.

Amendment 65A not moved.

Amendment 65B

Moved by

65B: After Clause 6, insert the following new Clause— “Air ambulance operations: regulations(1) The Secretary of State may by regulations make provision for the purpose of supporting the operation of air ambulance services in civil aviation.(2) Regulations under this section may, in particular, make provision about—(a) access to airport and aerodrome facilities;(b) access to airspace and air navigation services;(c) the treatment of air ambulance operations in aviation planning and operational decisions.(3) Before making regulations under this section, the Secretary of State must consult the CAA, air ambulance operators, airport operators and such other persons as the Secretary of State considers appropriate.(4) Regulations under this section are to be made by statutory instrument.(5) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”Member’s explanatory statement This amendment would allow the Secretary of State to make regulations supporting the operation of air ambulance services in civil aviation.

Lord Berkeley (Lab)My Lords, I am grateful for the opportunity to speak to these amendments today. Before speaking to the individual amendments, I would like to reflect on how great it has been to hear so many comments about general aviation, which tends to get left out on occasions. All my amendments in this group apply primarily to general aviation. Amendment 65B is designed to give encouragement and support to the air ambulance team, which does an enormous amount of good work not only in places such as Cornwall and the Isles of Scilly but all over the country—and not just over the sea.

13:30:00

A group of air ambulance operators have expressed considerable concern about the rules governing where they can land with their patients, how they arrange it and who gets priority. The feeling is that it is a bit of a mess. Given that so many of the passengers are probably heading for a trauma location, it is a matter of considerable concern to these operators and, of course, to the National Health Service, MHCLG and everyone else. The amendment would place a duty on the Government and the CAA to ensure consistent national application of relevant aviation and regulatory safeguards to support the safe and consistent provision of air ambulance operations near these major trauma centres or specialist hospitals.

This is the unanimous view of the industry. It is particularly keen for co-ordination with the CAA to reduce local variations and improve system-wide consistency. I hope that, when he responds to this amendment, my noble friend will accept that there is a need to co-ordinate all the different organisations involved, because whatever arrangements are made, they need to be made quickly. That is the whole basis of getting to hospital quickly, and it is apparently not working at the moment.

In this context, it is mostly helicopters that provide this service, in my experience. They need training too. It is not quite the same, I believe, as what you might call fixed-wing training, but it is still training. I was therefore a bit concerned by my noble friend’s response on Tuesday, when he said that, when it comes to instrument landings in poor weather, there are

“detailed requirements for training in international and UK safety regulations. Requiring training would not be appropriate for all airfields. Smaller airfields may not be able to accommodate this, and it may also be unsuitable for larger ”—[ Official Report , 16/6/26; col. GC 114.]

airfields. You can interpret that as meaning that there will not be any training in future. I am sure that is not what he meant, but I hope he will clarify that. Training is needed in all kinds of situations, not just for pilots, who are of course very important, but for controllers and everyone else involved in safe operation. Training needs to play an important part in this.

I turn to Amendment 65C. This is a slightly different subject because it relates to navigation in poor visibility. I suffer that all the time when I go to the Isles of Scilly. When you get delayed for three days because it is foggy, you begin to think, “Isn’t there a better solution?” Over the years, I have been chasing one.

We were nearly there when Brexit happened. The Government were almost set up to install EGNOS, allowing the connection with the satellites, and to encourage operators of small planes to install the comparatively cheap equipment in their craft. I remember calling the European Commission at the time and asking what it would take if we continued with EGNOS as a separate cost outside the European Union—Jersey has EGNOS and it works very well. The answer I got then, which was probably eight years ago, was that it would cost about £32 million a year to cover the whole country. Of course, when the whole country is covered, it covers all airports—not that you would use it at Heathrow or Gatwick, probably, but it would still be there. It is essential when you are unable to have ground connections, in places such as the Scottish islands or Scilly. In those places there is nowhere to put the ground connection because it would be in the sea, and I do not think it would work very well. My amendment is designed to put pressure on the Government. Will they reopen negotiations on EGNOS?

I do not think there is an alternative that is immediately available. Ministers over the years have told me that an alternative is available, but, when I ask when it will work and how much it will cost, they say that it is still being developed. I will probably get the same answer today. EGNOS may not be the answer to a maiden’s prayer for the next 20 years, but it is very good for the next 10 years. I hope my noble friend will say that he will reopen negotiations to rejoin EGNOS and put it across the country in a way in which small aircraft, small airports, helicopters—through a development called PinS—and everyone else has the ability to use it at a reasonable cost.

If my noble friend has doubts about how this could be done, perhaps he would be pleased to have a meeting with me, and anybody else who is interested, to see whether we can push this forward. It has been 10 years since it was cancelled, and it is about time we had proper navigation for operating safely in fog in areas where it is not possible to have the systems that big aeroplanes have.

I note a Written Answer in the House of Commons on 15 June, which says:

“The department will undertake a comprehensive review of the transport case and practicalities for rejoining … (EGNOS). This work will be carried out in 2026 with the aim that a decision can be taken by the end of the year on whether to seek to rejoin”.

Does my noble friend think that is a reasonable programme and will the department make a decision by the end of this year?

Finally in this group I have Amendment 102A. I am not part of this team, but I have been told that an airfield advisory team established some time ago with experts from all parts of the industry suddenly appears to have been cancelled or closed. I hope that my noble friend will say that, as part of the comprehensive consultation that we will have to have in the next few months, this airfield advisory team, with all the experts in the industry, will be re-established. I beg to move.

Lord Harper (Con)My Lords, I support Amendment 102A, also supported by the noble Lord, Lord Davies of Gower, who is unfortunately not able to be with us today. He was here for day one in Committee, and he wanted me to place on record his support for this amendment.

As the noble Lord, Lord Berkeley, has set out, the airfield advisory team is something that existed and has recently been disbanded. It would be helpful for the Minister to confirm that that is indeed the case, give the reasons for disbanding it, and say whether, in the light of the amendment, he would reconsider that decision. My understanding is that it was a useful forum for the CAA and the Department for Transport to engage with airfield operators to discuss relevant issues, and for them to communicate with those operators, but, perhaps more importantly, for airfield operators to feed back their concerns and ask questions of the regulator and the department.

Unless there was a very good reason for getting rid of it, having those forums for users of the services provided seems a very good thing. My understanding is that the airfield operators would very much welcome that advisory team being re-established. I would be pleased to hear what the Minister has to say.

Viscount Goschen (Con)My Lords, I support the noble Lord, Lord Berkeley, in this group of amendments.

We are fortunate to have air ambulance services operating in the United Kingdom. It is important to stress that these are typically not government-provided services; they are supported by charitable organisations and others. When one needs the service, one needs it very much indeed—that is probably the best way of putting it. The speed of response, particularly in rural Devon where I live—the air ambulance is based in a field that I am very familiar with—means that it is a tremendous service. It is able to get around the county swiftly and provide much needed services for people who have been involved in serious road or agricultural accidents, have been carried out to sea, or whatever.

I was concerned to hear, as the noble Lord stated, that the industry had concerns about the rules and regulations and procedures under which they operate, and felt they could be enhanced. From my own anecdotal experience of hearing from the air ambulance service, I know it is always given priority, formally and informally, by other users and by ATCs. I am concerned and surprised that there are such problems, and I look forward to the Minister responding. On whether those requirements should be written into the Bill, I am not going to fall into the trap, much criticised earlier in our proceedings, of doing the Minister’s job for him. We will let him do some heavy lifting on that.

Similarly, on Amendment 102A, I am not familiar with the precise detail but it is clearly important that the CAA takes fully into account all the voices and interests of those with a great deal of expertise in small airport operation. Again, whether that needs to be written into the Bill or not is something that we can consider later. If the noble Lord succeeds in achieving his objective of easier access to the Scilly Isles, no doubt he will be carried shoulder-high by his fellow islanders.

Baroness Pidgeon (LD)My Lords, the amendments from the noble Lord, Lord Berkeley, are worthy of support and raise some important points. I am grateful to him for bringing these important matters before the Committee and for his persistence on these issues.

13:45:00

I begin with Amendment 65B. I am a member of the APPG for Air Ambulances. They provide an absolute lifeline. Every single day, crews attend road traffic collisions, cardiac arrests, serious falls and medical emergencies in some of our most remote and inaccessible communities, and across the country as a whole. They reach patients and bring specialist pre-hospital care to the roadside with great speed. They are quite literally the difference between life and death, yet these services operate in a regulatory environment that has not kept pace with the demands placed upon them. The airspace modernisation agenda, which the Bill advances, is welcome in many respects, but modernisation brings disruption. That disruption must not come at the cost of the operational resilience of our air ambulances. If new flight paths, procedures or airspace designations create barriers to the rapid deployment of these critical services—they are all charities, as we have heard—patients will pay the price. I hope the Minister will give this matter the serious attention that it deserves.

Amendment 65C on satellite navigation is closely related. Air ambulance crews, along with the wider general aviation community, depend on precise, reliable navigation. EGNOS, the European satellite-based augmentation system, which we have debated many times in the past, provided that reliability. We lost it after Brexit, and the timeline for its replacement is unclear. A requirement for a report from the Secretary of State on access to EGNOS or an equivalent service is a modest ask, and I hope the Minister will be sympathetic. We need to understand where we are and when parity will be restored. I hope the Minister will consider these amendments and I look forward to his response.

Lord Moylan (Con)My Lords, the noble Lord, Lord Berkeley, has brought before the Committee some interesting and valuable amendments. I look forward to hearing what the Minister has to say about them.

On EGNOS, I never quite understand why everyone wants to crawl back to Europe. The problem with that is that, every time you ask the Europeans for something, they want to exact a very large price, simply because they are still very cross with us for voting to restore our representative democracy in this country and for taking advantage of Brexit.

It is worth asking the Minister if he has discussed whether this service might be available, with a bit of expenditure, from Mr Elon Musk. As I understand it, Elon Musk is now in command of around two-thirds of the satellites going around the earth. I am sure that a man of such ingenuity and enterprise could easily develop a navigation system that depended on these satellites. Would that not be a sensible alternative? It might keep the Europeans on their toes, should we want to use their system, if they thought of taking advantage of us. Otherwise, I look forward to hearing what the Minister has to say. There is a bigger world out there—it is not just Europe—and we should all take advantage of it.

Lord Hendy of Richmond Hill (Lab)My Lords, this grouping covers resilience, infrastructure and connectivity. I begin by addressing my noble friend Lord Berkeley’s Amendment 65B. I listened carefully to the noble Viscount, Lord Goschen, and the noble Baroness, Lady Pidgeon, on this subject. The Government support the life-saving work of air ambulances and the department, alongside the Civil Aviation Authority, regularly engages with air ambulance charities to understand their unique needs. Air ambulances already operate under a special regime from the Civil Aviation Authority that allows them privileged access to airspace and ensures that they can land wherever they need to in order to carry out their life-saving work. If my noble friend or the operators have any concerns about how this is working, the Minister for Aviation in the other place would be more than happy to hear them and deal with them. I hope that reassures my noble friend that his amendment is not needed.

On my noble friend’s Amendment 65B, the Government recognise the importance of satellite navigation services to support operations in all weather conditions. As my noble friend notes from his observation of the Answer to a Written Question in the other place, the Government are actively reviewing the viability of these services, including our access to the European geostationary navigation overlay service, or EGNOS, and the output from that is expected later this year, as he said. I will not pre-empt that review by accepting this amendment. I have not personally spoken to Elon Musk on this, or indeed any other subject, but I am sure that the Government are considering the full range of possibilities to do what EGNOS delivered in the past. I hope my noble friend understands that I cannot pre-empt the outcome of that review.

Finally, I thank my noble friend Lord Berkeley for his amendment relating to an airfield advisory team. The CAA carries out extensive engagement with aerodrome operators and values the insights and feedback that they provide, which play an important part in informing policy development in this area. At present, there is no clearly established rationale for creating a statutory panel for this group of stakeholders, particularly when similar arrangements are not in place for other stakeholder groups. Introducing such a panel could risk creating an imbalance by conferring a status on one group over others. But, having noted the concerns of the noble Lord, Lord Harper, I will take the issue away and inquire further about this team and the reasons for its disbandment. I hope that my noble friend will not press his amendment.

I should add clarity to my comments in Committee on Tuesday, to which my noble friend referred. I said this in my speech:

“Requiring training would not be appropriate for all airfields ”.—[ Official Report , 16/6/26; col. GC 114.] I then gave some different reasons, which my noble friend quoted, for why training might not be possible at some airports. It was certainly not intended to suggest that no airfields would be suitable for training, as that would be unacceptable. I hope that that makes things clear.

Lord Berkeley (Lab)My Lords, I am grateful to all noble Lords who have taken part in this short debate. I am very grateful to my noble friend the Minister for his answers, which I shall read carefully. I still think that it would be useful if we could have a quick meeting with him before the next stage, particularly to be told a bit more about what is happening on EGNOS and whether Mr Musk’s alternative is a sensible one. In the meantime, I beg leave to withdraw the amendment.

Amendment 65B withdrawn.

Amendment 65C not moved.

Clause 7Allocation of slots and co-ordination and facilitation of schedules

Amendment 66

Moved by

66: Clause 7, page 7, leave out lines 18 to 27 and insert— “(a) allocating additional capacity created at an existing airport or a new airport where the affected air carriers have failed to reach a voluntary commercial agreement within a reasonable timeframe;(b) as to the circumstances in which, the terms on which and the procedure by which, slots may be transferred, exchanged or withdrawn where there is no agreement between the commercial parties about the slots;(c) determining the temporary reallocation or suspension of unused slots during a period of international crisis;”Member’s explanatory statement This amendment strictly limits the Secretary of State’s power to intervene in airport slot allocation to distinct scenarios: managing unused slots during international crises, handling entirely new airports, or distributing newly created capacity where commercial airlines fail to reach an agreement, thereby preventing broader state intervention in functioning commercial slot markets.

Lord Grayling (Con)My Lords, we now move on to the slots regime. My two amendments in this group, Amendments 66 and 68, are designed to press the Government to understand what they are trying to achieve and where the limits to that are.

I had always expected that, when we left the European Union, we would be able to have a less regulated slots regime, particularly once we and the European Union had taken the view that we would not stay part of the EASA. Fundamentally, we are talking about a private sector market, with privately owned airports or airports owned by third-party bodies—such as the local authorities in Manchester—and independent airlines. So the question is this: what do the Government actually need to do? What is the role of the Government in this space? Should the Government be determining how many airlines fly to an airport, how many slots are available to it and the circumstances in which slots can transfer between one organisation and another?

It seems to me that there are three things that the Government should be doing. I see the role of the Government in this as referee rather than regulator. I am concerned that the content of the clauses that relate to the slots regime give the Government extraordinarily sweeping powers. If I have a slight regret, it is that I did not provide for the removal of new subsection (4), which says:

“The regulations may make different provision for different purposes”.

What on earth does that mean? The Government are taking on to their own shoulders blanket powers to manage the whole of the slots regime between a commercially run airport, a commercially owned airport and a commercially owned airline. To me, that feels like many steps too far. What I have sought to do with these two amendments is, first, on the principal amendment, focus on the things that the Government need. The first is all about acting as arbiter and referee, where there is genuinely a problem. We are talking about our key airports here. Where there is genuinely a problem—a dispute that cannot be resolved—I understand that the Government may, for strategic reasons for the benefit of the United Kingdom, need to have put in place some form of arbitration mechanism. Proposed new paragraphs (a) and (b) are designed to achieve that. It is topical because of the Iran war, as we have seen. We had the debate last week over the change to the slot regime resulting from that conflict and the need to take away from airlines the requirement to use a slot at a particular time. There may be circumstances in which, in a period of international crisis, the Government need to have a role in the slot regime.

I should also say that, on reflection—I look at the amendment of the noble Lord, Lord Empey—I agree that there is an element, although we might not agree about the scale of it, of a need to make sure there is connectivity within the United Kingdom. In part, the market delivers that anyway. If you are a major international airline flying from Heathrow to another part of the world, you need the feeder flights to fill your planes. If you do not have flights from Belfast, Glasgow, Edinburgh and Manchester, you are losing a whole chunk of your market—probably losing a whole chunk of it to Schiphol. It is not, therefore, necessary for the Government to take an absolute view about this. But in much the same way that the Government provide and subsidise key strategic routes within the United Kingdom that may not be economically viable but are socially necessary, I understand that there may be a case, in some circumstances, for making sure that a particular route and slot is available to the airline. Therefore, I am not sure I agree with the full detail of the noble Lord’s amendment, but I have some sympathy with what he is trying to achieve.

What we do not need to do—this is my fear about elements of the Bill—is try to micromanage the market that is the independent aviation sector. This part of the Bill feels like it is treading into that territory. I am looking for the Minister to provide some clear justifications for the steps being taken here. Particularly, Clause 68 is designed to address, effectively, a criminal provision within the slots regime. I do not quite understand that. Why on earth does there need to be a criminal context to the management of the slots regime? I understand that there can, on occasions, be a need for regulatory enforcement or enforcement in the civil courts—but the criminal courts? My amendment would take out that provision. Frankly, I would take some persuading by the Minister before we come to Report that we need a criminal provision in the management of slots at our key airports. That feels like a bridge that goes much too far.

I need to hear from the Minister an explanation for why all this is necessarywhy the slots regime needs to be as all-encompassing as it is, and why the Bill comes up with extraordinary provisions of interference. I refer again to proposed new subsection (4). The Bill does much more than is necessary to provide a sensible framework simply for protecting the strategic interests of the United Kingdom. It amounts to interference, not strategy, and should take a step back from where it is.

Lord Empey (UUP)My Lords, I instinctively agree with a lot of what the noble Lord, Lord Grayling, has said but there are situations in extremis that could arise regarding access to hub airports, which is a critical—not only socially but economically—necessity. It has nothing to do with subsidy. There are some modest PSOs in operation. We had them when we were in the European Union. Cornwall was involved at one stage and had a subsidised air route. But that is not what I am getting at here. It is nothing to do with subsidy because all the main regional airports going to hub airports, primarily Heathrow, are perfectly economically viable. It is not a question of subsidy.

14:00:00

Slots are very complicated; I am under no illusions about that. They are big money, particularly at certain times of the day, and some airlines own very large chunks of them. Because airlines are commercial businesses and have shareholders, shares can be bought and sold. A company that has access to a lot of slots, primarily at Heathrow, could be bought by an international company in the Middle East or the Far East, for instance, that says, “We’re interested, to a point, in flying to Inverness, Glasgow, Edinburgh, Belfast or Manchester, but, on balance, we’ll keep some of those going and use some of the rest of them to service international routes, which we believe would be more profitable to us”.

In some circumstances, it is difficult and time consuming to get from regional airports to hub airports. It can take hours by train. In the case of my own city, the only alternative is a ferry followed by a train journey. If you are trying to attract business or tourism, businesspeople are not going to be bothered with that. They are not prepared to take the time; it just makes you completely uncompetitive. Belfast might be an extreme example but, for Scottish airports and others, distance is an issue.

The noble Lord, Lord Grayling, is correct to say that it makes sense to have feeder flights, but I am trying to envision a set of circumstances, which I hope will never arise, in which an operator, while continuing to operate a route, decides that, instead of doing six, seven or eight rotations a day to a particular airport, they will cut it to, say, four. The other issue is time. In some cases, the value of these slots is related to the time that they are applicable. If you are trying to have a day’s business in London, for instance, you need what we would call a red-eye flight. If you have a lunchtime flight, it is a waste of a day.

I raised this in the House many years ago, in two Private Members’ Bills, both of which passed, I have to say, but suffered under the watchful gaze of a certain Member in the other place who had a penchant for dealing with Private Members’ Bills in a very cruel fashion. Some of the powers that the noble Lord, Lord Grayling, mentioned, seem huge, but I would like the Minister to confirm that, if such a circumstance arose where an operator that had access to key slots at a hub airport chose to replace those routes with alternative—say, international—routes, regional airports would not be disadvantaged to the point that there would be significant economic or social damage. In those circumstances, could the Secretary of State intervene?

Then there is the whole question of the terms on which a Secretary of State would intervene. These slots are very valuable and they are on the balance sheet of airlines, so this is not an easy thing to discuss. As the noble Baroness, Lady Foster, often points out, we are in an international context. When the Private Member’s Bill was brought forward, the noble Lord, Lord Ahmad of Wimbledon, was the Minister. He argued that this was, in effect, a European competence, and he was able to dodge the column on that.

The principle, however, is very simple. I am arguing that slots are worth money, but they also have a national implication for the connectivity and economic and social well-being of the entire United Kingdom. If hub airports are in the United Kingdom, it is not unreasonable that the Government, through the Secretary of State, should have the ability to ensure that the regions are not cut out of access or disadvantaged in any way by the absence of slots or the reuse of slots for alternative uses.

I understand the complications, but the fundamental principle is fairly straightforward. The Minister may be in a position to tell me that the Secretary of State has the powers that he needs. If that is not the case, I will certainly wish to come back to this on Report because it is a fundamental issue and I think it is easily solved. I do not anticipate any need for any interventions at the moment or in the foreseeable future. The rotations are pretty good and they are obviously there because the airlines feel that they are making a profit. We are not talking about subsidies here. It is access, not subsidy, that is the issue.

Lord Harper (Con)My Lords, I will primarily speak to my Amendment 73, which was suggested by IATA. I tabled it because I read it and thought it raised some important issues on which I want to test the Government’s thinking.

When I was Secretary of State, this process worked very smoothly and, as my noble friend Lord Grayling said, this is largely a commercial exercise. Slots have economic value. They are allocated independent of government and that usually works very well. There are circumstances, as the Minister set out at Second Reading, where there are challenges to how the system works because of outside circumstances. The Government then step in and make some changes which work in the interests of consumers and the industry.

It is also the case that the slot co-ordinator, Airport Coordination Limited, a private company, exercises a considerable amount of power and influence. At airports with a constrained supply of slots, that gives it significant economic power. At the moment, it does not have any regulatory oversight. It is effectively exercising what could be argued to be a quasi-regulatory function, but there is no formal oversight.

The amendment I have tabled is quite narrow but would bring the co-ordinator under the oversight of the CAA, which would give it the ability to scrutinise decisions and its governance. It would, importantly, preserve the independence of the UK slot co-ordinator, which is important and required by our international agreements. It would also introduce a proportionate independent mechanism to challenge decisions. At the moment, if anybody wants to challenge a decision, they have to go through a judicial review process, which is very costly, time-consuming and almost never happens. If you had CAA oversight, it would mean that either the airlines or the department could refer decisions to the CAA and have them looked at independently. It is important that the Government do not have the power to do that, but we should have some sort of process in place.

What I seek from the Minister is the Government’s view on whether the system works well at the moment. Do the Government believe the slot co-ordinator, effectively, has powers which should be better regulated or are they perfectly content with the system as currently set up? Do the Government think it need any changes? I thought the amendment was a useful way of testing the Government’s view. I was therefore very happy to table it and to make the case for it. I look forward to the Minister setting out the Government’s position when he responds to this group.

Lord Holmes of Richmond (Con)My Lords, I am delighted to follow my noble friend Lord Harper. I intend to speak to Amendments 74 and 75 in my name. It would be only slightly reductive to say it is all about the slots. In many ways, this part of the Bill is the very heart of the industry.

To that end, it would seem to make sense, under Amendment 74, to have greater clarity and transparency for all those who should be involved, should be concerned and should have a role in this. They would have that clarity through such a system as set out in Amendment 74. Again, I accept the specificities around blockchain and DLT and would insert mid speech a criteria-based approach so that other technologies which could achieve this aim are equally beneficial to the purpose of the amendment.

Amendment 75 moves that on somewhat to test how much the Government would wish not to overly interfere with slot allocation but, where all things remained equal, they would want other provisions to be brought in. In Amendment 75, I cite the example of environmental concerns, but the principle would work equally well for regional connectivity being higher up the agenda or other issues the Government may wish to push through. As has been rightly set out by my noble friend Lord Grayling, this is largely a commercial matter and there is a market but, like all good markets, that does not mean there is no role for government in it.

It is clear that the Government need to get the right level for that role and not overstep, but it is critical because in many ways the essence of that element of the industry is all about the slots. I am interested to hear where the Minister believes that line should be drawn and whether there is potential to bring other factors to bear, which would fit very well with some of the Government’s other key objectives, such as environmental issues, growth, the nations and regions, and connectivity. I look forward to the Minister’s response.

Baroness Foster of Oxton (Con)My Lords, I should like to make a couple of observations on the amendments tabled by colleagues. First, it is clear that slots are a very complex and sophisticated trading system, the value of which, as my noble friend Lord Empey mentioned, will certainly be like the value of a company. I go back to the comment about European Union regulation. I was involved in the initial European Union regulation more than 20 years ago, and the revision about 10 years later. I can say with great certainty that even the European Commission did not have any involvement in the designation of slot use. That was completely a no-no, and that was absolutely right.

This brings me then to the possible role of the Secretary of State. Slot allocation is a neutral, independent activity, handled by the slot co-ordinator without due influence of government, airlines and airports, and long may that remain—if it ain’t broke, we do not need to fix it. My view is that Secretary of State should not be at liberty to decide on slot allocation outcomes, whether temporary, during periods of crisis, or during normal times. There is no evidence that our slot co-ordinators, certainly in the United Kingdom, have ever been unduly influenced and made the wrong decisions, so I think we should continue to have that confidence in their role. It is recognised both Europe-wide and more internationally, because Heathrow as a hub is an extremely important airport.

I would like to touch on a comment from the noble Lord, Lord Holmes. His amendment talks about the environment and a possible link to an environmental allocation. I do not believe that is the right way forward at all. It is the wrong tool to ensure the sector’s sustainability targets can be met. In any event, the actual co-ordinators can already choose an air carrier due to their environmental credentials. However, this is not and should not be their primary decision.

I finally reflect on what we complied with in the United Kingdom, and still do, even though we are not members of the European Union. Regulation 598/2014 introduced noise-related operating restrictions at EU airports, which broadened that out to environment as well. It was called the balanced approach and repealed a directive from some years before.

14:15:00

As I have said, the environment is mentioned as part of that. The details come from what is called ECAC.CEAC Doc 29 —some of your Lordships will know what I mean. We already comply with all the details that come from those regulations and documents. It is not as though there are no references and that we are not compliant with environmental issues and pressures at this time. We also have to recognise that, fortunately, because of our excellent scientists and engineers, we know that the minimum engine type operating at these airports is a chapter 4 engine. Again, our airports have to be compliant with the rules laid down by ICAO. We are obviously obliged to comply with international rules and regulations from those bodies, and we certainly do in the United Kingdom.

Baroness Pidgeon (LD)My Lords, this is a substantial group and I am grateful to noble Lords who have tabled amendments covering how slot allocation powers should be structured, constrained and scrutinised. It is a clear theme in many of the amendments before us. I thought the referee versus regulator point from the noble Lord, Lord Grayling, was powerful in summing up a lot of this.

Before I turn to the amendments, I will remind the Committee of a thread that ran through Second Reading: the question of airport expansion and, in particular, whether the slots regime and the significant new powers that the Secretary of State is taking in relation to it could be used to facilitate or, in effect, predetermine expansion decisions. As your Lordships have heard, slots are capacity. Control over slot allocation is, in important respects, control over how airports can grow and who benefits from that growth. The Government may say that the expansion question is separate, but the mechanisms are not neatly separate, and I suspect that those questions will return on Report.

The regional connectivity concern raised in this group is one that many noble Lords feel strongly about. Hub airport access for regional routes is not just for commercial convenience. It is a question of whether communities and economies across the United Kingdom are connected nationally and then internationally.

Finally, on parliamentary procedure, the House has consistently held that significant regulatory powers should be subject to proper parliamentary oversight. I hope the Minister would not want to resist that principle here. I look forward to his response.

Lord Moylan (Con)My Lords, I will briefly introduce my own amendments and then comment on others. I have Amendments 70, 71 and 72. Amendment 72 is consequential on Amendment 71 so, in effect, I have two amendments, and the first is to do with consultation.

I can see no requirement in the Bill for the Government to undertake any consultation prior to exercising the powers they seek under this legislation. We recently debated the Airports Slot Allocation (Alleviation of Usage Requirements) Regulations 2026, and the industry told us that the consultation on those was extremely short. That was partly to do with getting the regulations done before the powers gap closes or opens, but the consultation was extremely short.

The result of it, according to the Government’s own statement, was that the airlines supported what the Government were doing but the airports were adamantly opposed. They were opposed principally because, as my noble friend Lady Foster said, the slots allocator already has the powers to respond in emergencies; there is no need for this action to take place. I come back to the point about consultation. That was a good example of consultation done badly and not listened to. Here, we have no consultation promised at all. My amendment would require it.

My second amendment concerns the fact that statutory instruments will be used here. The significant ones will be done by the affirmative process, but there is an exemption for those that have temporary effect, which will be done by the negative process. This is a direct downgrading because the airport slots regulations we considered in Grand Committee only last week were temporary in their character; they last only for the coming summer and winter seasons. It is precisely that type of statutory instrument—that type of government action—that will now be moved to be taken under the negative process. This is definitely a downgrade of parliamentary scrutiny and my amendment would eliminate it. Amendment 72 is, as I say, consequential on that.

To come to the other contributions in this debate, it is fair to say that, between them, my noble friends Lord Grayling and Lady Foster of Oxton have driven an entire coach and horses through this section of the Bill. They ask the crucial question: what is the necessity for this? Not only that, but what is the benefit to the public of the Government intervening in something that is, in essence, first, a private market activity and, secondly, working perfectly well at the moment, with no reason to think that that is likely to change? Although I am sure that the Minister will want to defend these proposals when he gets to his feet, the tenor of debate in Committee is that they should be done away with wholesale. My amendments, which would simply require consultation and better processes, are inadequate to the task. When we come back on Report, we will have to challenge clearly why the Government are involved in this at all, with what purpose and to what effect—unless, of course, the Minister can satisfy us today.

Lord Hendy of Richmond Hill (Lab)My Lords, as we have heard, this group concerns the airport slots regime. I am grateful to noble Lords for their amendments. I will address each one in turn but first note two common points that apply across this group.

The UK slots regime depends on independent, fair, transparent and non-discriminatory allocation by the slot co-ordinator. It also operates within international frameworks, such as the Worldwide Airport Slot Guidelines , the global standard for managing airport capacity at congested level 3 and capacity-constrained level 2 airports. The regime already recognises commercial expectations that require clarity, consistency and timely decision-making. Where I refer to independence, proportionality, flexibility or international alignment, these are the common justifications I have in mind. I also say to the noble Baroness, Lady Pidgeon, that the processes in this Bill do not in themselves allow airport expansion; they are about the efficient allocation of capacity created by expansion, which is a different issue.

I begin with Amendment 66, tabled by the noble Lord, Lord Grayling. I understand the concern that the Government should not interfere in a liberalised and well-functioning sector, and our policy intent is not to interfere in this. These provisions, however, largely replicate provisions previously available through EU legislation. All the Government are doing is replicating the powers we think we appropriately need to continue. I refer the noble Lord to paragraphs 20 to 24 of the Explanatory Notes to the Bill.

Neither the Government nor airlines have a role in the day-to-day allocation of slots. As noble Lords have noted, that is undertaken by an independent slot co-ordinator who must allocate slots openly, fairly, transparently and without discrimination. The amendment would therefore not have the intended effect and would create uncertainty. The temporary reallocation or suspension of unused slots during an international crisis is already addressed by Clause 7. In our view, Amendment 66 is therefore unnecessary and duplicative.

I turn to Amendment 67, tabled by the noble Lord, Lord Empey, which would require sufficient slots at hub airports such as Heathrow to be allocated to flights from UK regional airports. The Government recognise the importance of strong regional connectivity and effective access to hub airports for people and businesses across the United Kingdom.

However, I cannot support the amendment because requiring hub airports to prioritise domestic regional services over international routes could conflict with non-discrimination and fair competition obligations in the UK’s bilateral air services agreements. It could also require the reallocation of slots from incumbent operators that have historic rights where usage requirements are met, raising legal and practical issues. I therefore ask the noble Lord not to press his amendment.

The next amendment, from the noble Lord, Lord Grayling, seeks to remove the ability to create regulations on enforcement of the slots regime through criminal and civil sanctions. Existing assimilated law already contains criminal and civil enforcement provisions, which the Government believe are necessary. Removing this power would freeze the current enforcement regime, meaning that even proportionate updates could be made only through further primary legislation. I do not believe that that is the noble Lord’s intention.

Lord Grayling (Con)Can the Minister illustrate to me the kind of circumstance in which a criminal sanction is required?

Lord Hendy of Richmond Hill (Lab)I will respond to the noble Lord after today.

Clause 7 already reduces the severity of sanctions by removing the possibility of imprisonment for breaches of slots regulations. Any exercise of the power to amend enforcement provisions would be subject to the affirmative procedure, ensuring scrutiny and debate in both Houses. For those reasons, I ask the noble Lord not to press his amendment.

I turn to Amendment 70, tabled by the noble Lord, Lord Moylan, which would place a statutory duty on the Secretary of State to consult airlines, airport operators and others before making any slots regulations under Clause 7. The Government recognise the importance of proper engagement and, where new policy is developed under this power, will carry out appropriate consultation, including with industry and, where relevant, communities. However, an inflexible statutory consultation duty would not be appropriate. The power may need to be used urgently in response to significant disruption, as was necessary during the pandemic. In those circumstances, government must be able to act swiftly and proportionately. I therefore ask the noble Lord not to press Amendment 70.

I will take Amendments 71 and 72, also tabled by the noble Lord, Lord Moylan, together. They would require all regulations relating to slots to be subject to the affirmative procedure. I recognise the desire for parliamentary scrutiny, but the Bill already draws a proportionate distinction. The negative procedure is available only where there is a significant threat to public health, or another substantial reason, and only for temporary changes to slot-usage requirements. Requiring the affirmative procedure in every case could delay necessary action during disruption, where speed may be essential. I therefore ask the noble Lord not to press Amendments 71 and 72.

Amendment 73, tabled by the noble Lord, Lord Harper, would—

Lord Moylan (Con)The point that the Minister makes about emergencies and so forth is not reflected in the text of the Bill, which says on page eight:

“Regulations are excluded regulations if the Secretary of State considers that their only substantive effect is temporarily to disapply or modify a requirement as to regularity of use of slots”.

That would cover the airport slots regulations that we debated last week. Those would move from being affirmative procedure SIs to negative procedure SIs. The additional stipulations that the Minister mentioned are not reflected in the clause that defines an excluded regulation.

Lord Hendy of Richmond Hill (Lab)I thank the noble Lord for that observation. I will of course take it away and consider what he has said.

Amendment 73, tabled by the noble Lord, Lord Harper, would place the slot co-ordinator under the oversight of the Civil Aviation Authority. I understand the intention to strengthen oversight, but the amendment would cut across a fundamental principle of the slots regime: that the co-ordinator must remain functionally and financially independent of all interested parties, including government. The noble Lord asked whether we are content with the current system, and we are. That principle is reflected in the Worldwide Airport Slot Guidelines , which align these matters across all level 2 and level 3 airports across the globe and are essential to ensuring that scarce airport capacity is allocated fairly, neutrally and without bias towards any airline, airport or Government. They protect new entrants and maintain confidence in the global system. Creating a statutory CAA oversight role would risk putting the UK at odds with established international practice and creating legal and operational uncertainty. I therefore ask the noble Lord not to press Amendment 73.

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I next address Amendment 74, tabled by the noble Lord, Lord Holmes of Richmond, which seeks a secure record-keeping system for slot transactions. As I said in relation to Amendment 73, slot allocation is undertaken by an independent co-ordinator; for UK airports, that is Airport Coordination Ltd. Airlines already notify ACL of transfers and trades. ACL acts as the central system of record, reviewing transactions against airport capacity and operational constraints, documenting exchanges, including monetary and non-monetary swaps, and publishing them online. While I welcome the noble Lord’s interest in innovation, technologies such as distributed ledgers are designed to remove the need for a trusted central party. Here, that central party already exists and is legally bound to operate neutrally and without discrimination. Amendment 74 is therefore unnecessary, and I ask the noble Lord not to press it.

Finally, I turn to the amendment from the noble Lord, Lord Holmes of Richmond, on attaching environmental conditions to the holding and use of airport slots. The Government fully recognise the importance of reducing aviation emissions and supporting the sector’s transition to net zero. However, I agree with the noble Baroness, Lady Foster of Oxton, that the slots regime is not the right mechanism for imposing emissions-related conditions on individual carriers. The Government are addressing aviation emissions through the appropriate policy levers, including the UK Emissions Trading Scheme, CORSIA and the sustainable aviation fuel mandate. The international slots regime is built on clear and predictable rules, including historic rights where slots are used sufficiently. Requiring carriers to retain slots by reference to separate emissions metrics would cut across that framework and create uncertainty for airlines and airports. I will return to wider environmental issues in the relevant group. For now, I ask the noble Lord not to press his amendment.

Lord Empey (UUP)In the Minister’s response to my Amendment 67, he responded to a point that I had not made. I had not asked for domestic slots to replace international slots. Mine is a probing amendment, but it is a very simple proposition: in extremis, does the Secretary of State have the power to ensure regional connectivity, or does he not? It is not a complicated issue in essence, even though the operational issues are. He anticipated something that I had not actually proposed, and I assure him that on this issue, while I shall not move my amendment today, I do not intend to go away. Perhaps his team could engage with me before Report.

Lord Hendy of Richmond Hill (Lab)If I may, I shall respond to the noble Lord by saying that, if I have not understood his point clearly, I shall indeed go away and have a further discussion with him.

Lord Grayling (Con)My Lords, we have had an interesting debate. Again, some important issues were raised. The noble Lord, Lord Empey, makes an important point. In fact, when reflecting on my own amendment at the start, I thought that what he was saying might be an element missing from mine. I have a lot of sympathy with what he has said.

I want to be frank with the Minister. He knows that I have the highest regard for him; he knows that I regard him as knowing more about much of the transport system than anyone I know, so I do not direct this comment at him, but at the Government. I am really quite unimpressed by the Government’s inability to explain what are relatively simple things, or should be relatively simple, if they had thought this through properly, in the measures that they are taking in this Bill and those in the debate that we had last week over the slot regime. If the Government want to take powers or continue powers to enforce criminal sanctions, they should at least be able to say what kind of issues those criminal sanctions are designed to address, because I do not think that this is simply a replication of existing EU law—and were it so, I would be asking what we can we do less of, rather than more of, outside the European Union. However, if the Government’s intention is purely to replicate what is there already, they do not need new Section 34A(4), which says:

“The regulations may make different provision for different purposes”.

What does that mean? What it does is create a blank cheque for the Government to expand their remit in the slots regime beyond where it is at the moment. They are also seeking, as I say, to continue with criminal sanctions. That does not feel to me like a Government who are trying to maintain a light touch in what the Minister rightly says is a commercial marketplace with established processes that are part of international agreements that go beyond the European Union. So some of this should not be necessary, and it should not be necessary to continue some of it on from what we had before. Where it is continuing, there needs to be a good explanation for it. I am sorry, but I do not think that the Minister has been able to give that good explanation. The Government need to do a better job on what should be pretty basic questions about what they are proposing.

I will of course seek to withdraw this amendment today, but I give notice to the Minister that these questions need to be answered properly before we get to Report, because I can see no justification for having what are clear Henry VIII powers in the slots regime. There is not even a provision for the affirmative resolution so, frankly, in six or 12 months’ time, another Minister—I am sure that it would not be this Minister—could simply come back and take a much more interventionist approach to the slots regime, which would be absolutely out of kilter with anything that we have done either inside or outside the European Union. For now, I beg leave to withdraw the amendment, but I will not leave this issue untouched when we come back on Report.

Amendment 66 withdrawn.

Amendments 67 and 68 not moved.

Amendment 69

Moved by

69: Clause 7, page 8, line 16, at end insert— “(4A) The Secretary of State may not make regulations under this section that would have the effect of facilitating airport expansion unless the Secretary of State has first—(a) consulted persons likely to be affected by the proposed expansion, including communities in the vicinity of the airport,(b) undertaken an environmental impact assessment of the proposed expansion, and(c) undertaken a noise impact assessment of the proposed expansion.”Member’s explanatory statement This amendment would prevent the Secretary of State from making regulations that facilitate airport expansion unless they have first consulted affected communities, completed an environmental impact assessment, and completed a noise impact assessment. It ensures that proper scrutiny and community engagement take place before any expansion can be progressed through secondary legislation.

Baroness Pidgeon (LD)My Lords, in moving this amendment, I shall also speak to Amendment 105 in the name of my noble friend Lady Grender, to which I have added my name. Amendments 69 and 105 address what is, for me, the key issue with the Bill: whether the powers could be used to facilitate airport expansion and, if so, on what terms. Amendment 69 would require the Secretary of State to consult affected communities, complete an environmental impact assessment and complete a noise impact assessment before making any regulations that facilitate expansion. Amendment 105 would go further by prohibiting the use of the powers in the Bill for that purpose altogether.

All the communities that are most directly affected by airport expansion—those living under flight paths, those experiencing noise, air quality and traffic impacts and those with a general disturbance from planes flying over them quite some distance from airports—have consistently found themselves presented with fait accompli decisions rather than meaningful consultation. Amendment 69 would, at a minimum, require such consultation, environmental assessment and noise assessment to precede any regulatory action that facilitates expansion. That is not a high bar; it is basic good governance. Although I heard what the Minister said to us in our debate on an earlier group, we believe that this amendment is very much needed, so that it is clearly spelled out.

Airport expansion, at Heathrow in particular, is one of the most contested infrastructure decisions that this country faces. It has planning implications, climate implications and profound implications for communities living under flight paths. Amendment 110 in the name of the noble Lord, Lord Harper, rightly asks for a published assessment of airspace slot and scheduling impact before any decision on a third runway. We think that he makes an important point.

The central question for the Minister is simplecan he give this Committee a clear, unambiguous assurance that nothing at all in the Bill could be used to facilitate airport expansion decisions that have not been subject to full environmental scrutiny, proper community consultation, which goes far further than the exercise we discussed earlier, and meaningful parliamentary oversight? I look forward to his answer with interest and I beg to move.

Lord Harper (Con)My Lords, I will speak to my Amendment 110 and make one or two comments on the amendments that the noble Baroness, Lady Pidgeon, spoke to. Amendment 69 seems perfectly sensible, requiring consultation and so forth. I have more of an issue with Amendment 105. If the processes to determine airport expansion have been complied with, it does not seem sensible to say, “As a result, you can’t use any of the powers in this Act to facilitate that properly taken and consulted-on decision”. While I do not have enormous objection to the noble Baroness’s first amendment, the second one goes a bit too far, so I am half agreeing with her, which is an improvement on where we were last time. I hope that she takes that in the spirit in which it is intended.

My remarks on my own amendment may appear a bit disjointed because I am going to slightly amend them in flight, as it were. Members of the Committee may or may not be aware that, while we have been debating this, the Secretary of State has published a Written Ministerial Statement on the aviation framework, which is specifically to do with Heathrow expansion. I thank the Minister for his courtesy in drawing to my attention, because I have tabled amendments on Heathrow, that the timing of the Written Statement would be during our debate today. I have been through the Statement, but it is quite extensive, so I have done it at speed and might ask things that are covered in it or in some of the attached documentation, which I have not had a chance to study. Given that the noble Baroness, Lady Pidgeon, talked about airport expansion, my amendment might give the Minister a helpful opportunity when he comes to wind up this group of amendments to perhaps set out for the Committee’s benefit one or two of the key points in the Secretary of State’s Written Statement, which I think will interest all noble Lords who are interested in aviation.

My amendment is drafted in such a way as to make sure that it is within scope of the Bill. The purpose of tabling it was to press the Government a bit on the choice that they made, which they set out last November and reiterated in the Written Statement today, to settle on the more expensive of the two options set out: the proposal by Heathrow Airport Ltd for a more ambitious, longer runway with a total price tag of £49 billion. Heathrow Airport has committed that that will be financed entirely privately. Obviously, there will need to be a regulatory funding mechanism for that, but I will not dwell on that now because I have some later amendments, in group 7, which I will touch on at that point, so as not to repeat myself.

I want to understand from the Minister whether the Government are satisfied—I presume that they are, given that they are proceeding in this direction, but I have not seen the underpinning rationale that supports the decision. When she made the decision, the Secretary of State said that the Government’s choice of the more expensive of the two options was “the most credible”, so I would like to understand the Government’s thinking about that.

The Minister and I worked together on HS2 when I was Secretary of State and he was chairman of Network Rail. He knows that infrastructure projects, albeit publicly financed ones, can end up costing rather more money than originally intended. I am worried that this project is now intended to be entirely privately financed. If that does not stick, the Government are very much committed—rightly, in my view—to expanding Heathrow, and I want to make sure that the taxpayer does not at some point end up being on the hook for very significant amounts of public money that they are not currently planning to spend.

14:45:00

Frankly, once someone is building one of these things and it is under way, particularly because it involves making extensive changes to the M25, at some point, if it ran into difficulty, the Government would not be in a position where they could just accept a half-done project and would inevitably end up having to work out how it was going to be completed. I want to test whether the Government are entirely satisfied on that purpose.

The final thing I shall say, because it is relevant to the brief comments I made about Amendment 105, is that clearly the expansion of Heathrow and a third runway will inevitably have airspace impacts, slot impacts and so forth. That is part of the reason why, given that there is an extensive process under way, there will be an updated policy statement on which the House of Commons will have an opportunity to vote, and then there will be a planning process. If, as a result of all of that, some of the powers in the Bill are needed to make changes, it would seem to me that a proper process would be under way, so it would be perfectly reasonable to use some of the powers in the Bill. My amendment would simply require the Government to publish the impact of that expansion on airspace use, slots, airspace design, schedules and air traffic services to improve transparency. My guess would be that compliance with this amendment would be met by the policy statement that the Government are planning to publish.

It may be that when I have read the Written Statement—the Minister can spell it out in a bit more detail when he responds—I am satisfied, but obviously I had not seen the Government’s Written Statement when I tabled the amendment and did not know it was coming today. It is well timed or badly timed, depending on your point of view. I will listen carefully to what the Minister says at the end of the debate and I will take some time after the Committee has finished to study the Written Statement in more detail.

Earl Russell (LD)My Lord, I shall speak to Amendment 114, standing in the name of the noble Baroness, Lady Bennett of Manor Castle. She is unable to attend the Committee today. I will speak to both her amendments, this one and one in a later group. I am mindful of what the Companion says on these matters, so, just to be clear, these are my words and not hers.

This amendment seeks to insert a new clause imposing a climate duty on the Civil Aviation Authority and the Secretary of State. It would require the CAA, when exercising its functions under the Bill, to have regard to the target established by Section 1 of the Climate Change Act 2008, the carbon budgets established under the Act and the need to reduce greenhouse gas emissions from civil aviation. It would also require the Secretary of State to have regard to emissions reductions when exercising powers under the Bill, to refrain from using those powers for the purposes of airport capacity expansion and to use them in pursuit of a strategy aimed at reducing airport capacity.

The case for the amendment is reasonably straightforward. Aviation is one of the hardest sectors to decarbonise, but difficulty is not an argument for inaction. It is precisely because aviation is hard to abate that we need clear legislative direction now rather than later. Without it, the CAA risks operating in a policy vacuum, exercising its functions under this Bill, particularly new functions, with no statutory obligation to consider our national carbon budgets or our commitments under the Climate Change Act, specifically in relation to new powers. I argue that that is not a sustainable position; it warrants examination and perhaps further clarity. The duty the amendment would impose is well known and deliberately light-touch. To “have regard to” is not a command. It would not stand in the way of other duties that the CEA continues to have in carrying out its functions. It would simply require that, when those functions are exercised, it has one eye on the statutory climate framework that Parliament has already enacted.

It would be curious indeed if the Bill to modernise our regulatory aviation framework contained no reference whatever to our climate obligations. I should be transparent with the Committee that my Amendment 107 in a later group pursues similar goals in perhaps a slightly different way. I guess my motivations are similar to those of the noble Baroness, Lady Bennett.

The CAA, particularly with its new powers, must be benchmarked against our national climate commitments. This and my future amendment both call for some form of reporting on that process. An annual account of the environmental efforts of the CAA’s functions and of its compliance with the climate duty is essential for meaningful future parliamentary scrutiny. Aviation’s contributions to emissions cannot be indefinitely treated as an afterthought in legislation. I hope the Minister recognises the constructive spirit in which the noble Baroness’s amendment is advanced, and I look forward to the Government’s response.

I turn briefly to Amendment 110, in the name of the noble Lord, Lord Harper. I thank him for his half-support, or support for one of our amendments, which is gratefully received. We on these Benches are supportive of his amendment: it is sensible and modest in its proposition. He asked some interesting questions of the Minister on the revisions to the Airports National Policy Statement that have literally just come out, and I would be interested in hearing the answers. We could have completely opposing views on whether we need Heathrow expansion but both accept this amendment. The point is not whether we support expansion but how it is reported and properly assessed. There needs to be a proper framework for doing that, so we are supportive of that.

Baroness Foster of Oxton (Con)My Lords, I will comment briefly on the subject in general. I have long been an advocate for airport expansion, particularly at Heathrow. On that note, I support the Government taking this brave step. Having lived in south-west London and under the odd flight path from time to time, I recognise that there was an airport there long before me and before most people who live in the area. It was unfortunately most regrettable—I now intend to be quite party political—that the fortunes of the Liberal Democrats relied on objecting to every element of expansion at Heathrow, whether for new terminals or runways. Most people would agree that we should have had a third runway more than 30 years ago, when the cost would have been substantially less.

My final point is that, while I fully support the Government pushing ahead with expansion and a third runway, the decision on this particular project, at a cost of £49 billion, with disruption to areas around the M25 and elsewhere, is completely wrong. I see it ending up like some of the other massive infrastructure projects that we have had in rail. I do not believe this is the best way forward. There should be a rethink. Other projects would be less disruptive but have not been fully considered. As a general point, I fully support the Government’s ideals to expand but think that the initial decision is wrong at this time.

Lord Moylan (Con)My Lords, I note the publication, while the Committee has been sitting, of the revisions to the Airports National Policy Statement . Obviously, I have not read it, and I do not imagine that other Members have, apart from the Minister and his close associates.

It is worth saying that that this publication does not take us forward; it takes us back to 2018, when the Airports National Policy Statement was published. It was then taken through the courts. There were some ridiculous objections to it, but it got through the High Court. It fell on one particular objection only at the Court of Appeal, which turned, as I recall, on the question of the definition of the word “policy”—this is how great infrastructure projects proceed in this country. It eventually went to the Supreme Court, which took a different view on the definition of “policy” and finally approved the ANPS. By that stage, of course, it was totally out of date and Covid had intervened, so the work had to be started again by the department. The fruits of that work are what have been published today. As I say, I am not in a position to comment on it. We are back to where we were in 2018 and have made no progress in that period. We will see whether this new ANPS survives the sort of process that the previous one was subjected to and whether we will need a third ANPS a few years down the road.

In relation to these amendments, I unfortunately find myself not entirely able to agree with my Liberal Democrat colleagues on the two in the name of the noble Baroness, Lady Grender. It is not because of the intention, because that is of course important—there should be consultation, an environmental impact assessment and a noise impact assessment if Heathrow is to be expanded—but because I think those things will happen anyway without this amendment. Nor can I honestly say that I support Amendment 105. One cannot create powers for the Government in specific areas of aviation and then say that they cannot be used for one particular purpose within the field of aviation. That makes no sense so, sadly, I am slightly out of sympathy on those two.

I understand the comments about the amendment proposed by the noble Baroness, Lady Bennett of Manor Castle, but, sadly, this time, I do not feel I can pursue that either. There are other amendments relating to the environment later on, not least one in the name of my noble friend Lord Harper, which raise some interesting questions.

I find myself very much in support of the amendment tabled by my noble friend Lord Harper. I sympathise with his remarks about the financial consequences and financial circumstances relating to Heathrow expansion. Perhaps I can give a few figures that will help the Committee put this in some context, and then put a couple of questions to the Minister.

Heathrow is a private company and it is very difficult to know its market valuation, because its shares trade so rarely. There was a trade 13 or 14 years ago, which valued the company at approximately £14 billion. That was roughly the same as the value of the airport’s regulated asset base at the time. There was then a trade approximately two years ago—there was quite a reorganisation of shareholders approximately two years ago—and I understand that the valuation implicit in those trades was that the airport was now worth only £10 billion, roughly. Its value had fallen over that period. Meanwhile, its regulated asset base has gone up to in excess of £20 billion, so the shareholders bought a regulated asset base for half its price.

Of the capital structure of the company, there is a large amount of debt—in fact, more debt than there was some years ago. The amount of equity belonging to the shareholders in the company is therefore probably no more than £2 billion—let us say £3 billion to be generous. Now we hear of a company with £3 billion of shareholder commitment that wishes to embark upon a project costing, conservatively, £49 billion at current estimated prices. This is vaunting ambition at the very least. If it were purely a private company, it would be completely unfinanceable without a huge new infusion of shareholder capital, because no bank will lend £49 billion to a company that has only £3 billion of equity and already has several billion pounds of debt on top of that. It is simply an unfinanceable project.

15:00:00

The whole thing rests on having a regulated asset-based finance structure, which allows Heathrow to finance the runway a long time before it is available for use. I genuinely do not know how long the project is going to take, but let us say it will take approximately 10 years to build it and all the stuff that goes with it; Heathrow would have to be financing it a long way in advance. That means airlines are paying for facilities that they cannot use because they have not been built. Passengers are paying for those facilities because they are reimbursing the airlines as far as they can.

Noble Lords will understand, therefore, that I share the doubts and scepticism of my noble friend Lord Harper as to whether this project can be financed purely on that basis. Bear in mind that there is the HS2 problem, whereby £49 billion is just a starting figure. Our anxiety is that this project gets a certain way and the Government become implicated in it because it becomes a policy to deliver it. Then, as the project stumbles on, the Government are drawn into having to finance it.

I would not object in principle if the Government were to say, “We are going to provide enhanced road and rail connections to Heathrow as a result of its expansion”. We find that acceptable in this country. It is a normal thing to do and I expect the Government, at some point, will have to commit to doing that. There are numerous schemes being discussed about enhanced Network Rail connections to Heathrow. Whether the Government, in their current anti-car mode, feel that there is scope for additional road access is another question, but there is certainly scope for new and additional rail access. Many schemes are going around at the moment and I would not be astonished if the Government say they will pay for them, because they provide new capacity and new connections. But what the Government must not do—I believe they have said they will not do—is pay for transport construction that adds no capacity or general benefit to the public at large.

This is where we come to the M25. Moving that road means tunnelling it, which in practice is the same as moving it, because one would not tunnel it where it is; one would build the tunnel further out and then move it. Inherently, that adds no capacity because, even if you built a 10-lane or 20-lane M25 in your tunnel, when it joined the existing M25, it would have to come back to the capacity it currently has. There would be little point in doing that as it would serve only Heathrow. My understanding of the Government’s view is that they will not pay for that.

The tunnelled option may not be the one chosen. An alternative is to build a runway on a slope over the existing M25; I do not know if that is being pursued. There is, I believe in Atlanta, an example of something like that over an interstate highway, so it is not as wholly unprecedented or ridiculous as it sounds, if the gradient is very low. However, it is more likely that the M25 is going to be moved.

I have a crucial question for the Government, which I hope the Minister can satisfy me on now. Is it the Government’s position that they will not pay for moving the M25 and any other works associated with it, which do not add capacity to the general motorway network and are very much part of the Heathrow bill for building the third runway?

The other question is simply more general. Do the Government believe that this is a credibly financeable project, even on a regulated asset base basis? Do they believe that it is fair that the airlines and their passengers will be paying so far in advance and over so many years for a facility that they cannot use? Answers to those three questions in clear, crisp terms that leave no room for ambiguity or doubt would be greatly appreciated.

Lord Hendy of Richmond Hill (Lab)My Lords, this group concerns airport expansion capacity. I am grateful to noble Lords for their amendments.

I will address Amendments 69, 105, 110 and 114 in turn. Before doing so, I will make two points that apply across the group. First, as I made clear at Second Reading, the Bill is not a route to airport expansion. It does not grant planning consent, remove environmental safeguards or predetermine the outcome of any expansion proposal. Secondly, where airport expansion is proposed, the relevant issues, including noise, carbon emissions, air quality, economic benefits and local impacts, are considered through national policy statements and the development consent order processes, with consultation, assessment, scrutiny and independent examination. Those are the common justifications, which I will refer back to. Expansion decisions sit within the planning regime, while this Bill concerns aviation consumer protection and regulatory reform.

I turn first to Amendment 69 spoken to by the noble Baroness, Lady Pidgeon. This amendment would require the Secretary of State to undertake consultation impact assessments before laying slot regulations that facilitate airport expansion. I reassure the noble Baroness that the Government are fully committed to meaningful consultation with communities and to thorough environmental and noise assessment before airport expansion proceeds. However, slot regulations do not grant planning for physical expansion, nor do they increase the legally permitted cap on aircraft movements. They determine how capacity at co-ordinated airports is allocated between airlines. The slots measure in the Bill would allow regulations to be updated if needed so that any capacity already approved through the planning process can be used effectively. Amendment 69 would therefore duplicate consultation and assessment processes that already take place before slot allocation becomes relevant, and for that reason I ask the noble Baroness to withdraw the amendment.

I turn next to Amendment 105, also tabled by the noble Baroness, Lady Grender. This amendment would prohibit the powers in the Bill being used for the purposes of airport expansion. The Bill and the question of airport expansion are distinct. The Bill is focused, as I said, on consumer protection reform of the aviation regulatory framework. The Government would take forward these measures, irrespective of any expansion decision. The Government support Heathrow expansion, but any decision on the third runway is subject to the national policy statement and the development consent order processes, both of which include consultation and scrutiny. Airspace modernisation is also needed, whether or not a third runway is proceeded with. Its purpose is to make UK airspace more efficient, resilient, quieter and cleaner, not to provide a shortcut to expansion. Similarly, slots regulation does not create airport capacity; it manages capacity after it has been approved through the planning process.

Amendment 105 would undermine the workability of the Bill’s regulatory framework. For example, it could prevent reforms to slot regulation where those reforms are needed to manage new capacity that has already been approved. I therefore ask the noble Baroness not to press it.

I turn next to Amendment 110, tabled by the noble Lord, Lord Harper, on a third runway at Heathrow. The Government agree that decisions on airport expansion should be evidence-based and subject to transparency, consultation and scrutiny. However, Amendment 110 is not necessary to achieve that, because decisions on Heathrow expansion will be taken through the national policy statement and development consent order processes.

As noble Lords have noted, the department has today published the revised airports national policy statement, which has been renamed the draft Heathrow expansion national policy statement, to clarify that it applies only to Heathrow expansion and its associated infrastructure for consultation.

In response to the noble Lord, Lord Harper, and others, I am not going to be in a position to respond to the detail of what has literally just been published, which I am sure he and others will understand. However, I have no doubt that the points he and others raise will be discussed both in your Lordships’ House and in the other place. I have also heard the noble Earl, Lord Russell, the noble Baroness, Lady Foster of Oxton, and the noble Lord, Lord Moylan, but as I say, this is for discussion at another time.

I have also written today to all noble Lords with further details. I hope that the noble Lord, Lord Moylan, will accept that I am not going to answer his questions now, because the Written Statement was laid less than two hours ago.

Lord Moylan (Con)Would the noble Lord be so good as to answer them by letter before we reach Report?

Lord Hendy of Richmond Hill (Lab)I will certainly consider what I can say to the noble Lord before Report.

The Heathrow expansion national policy statement includes the full suite of appraisal and supporting analytical documents. Alongside the public consultation, that draft policy statement will be laid before Parliament and subject to parliamentary scrutiny by a nominated parliamentary Select Committee. Following the consultation, the Government will carefully consider all responses received, alongside the report of the parliamentary Select Committee, before deciding whether to designate an amended national policy statement. If the Government decide to proceed, the amended policy statement will be published and laid before Parliament, in accordance with the requirements set out in the Planning Act 2008, and be subject to a vote in the other place before it can take legal effect. Any development consent application for expansion at Heathrow must include detailed, project-specific assessments, including operational and system-wide impacts, and will be published and examined through the Planning Inspectorate process.

Not all the matters covered by Amendment 110 can be determined at a single point. Airspace design, in particular, is developed iteratively and requires sufficient certainty about an expansion scheme before it can be finalised, approved and implemented. Airspace change proposals are also subject to their own oversight processes, including detailed assessment and public consultation, and do not pre-empt planning decisions. It would not be appropriate to include requirements for a specific infrastructure project in this Bill, which is concerned, as I have said, with consumer protection and regulatory reform. Given the extensive information and scrutiny that will already apply to Heathrow expansion, I ask the noble Lord not to press his amendment.

Finally, I turn to Amendment 114, tabled by the noble Baroness, Lady Bennett, but spoken to by the noble Earl, Lord Russell. I agree that tackling climate change and reducing aviation emissions must remain central to aviation policy. However, I cannot accept this amendment. Elements of Amendment 114 would duplicate existing duties under the Climate Change Act 2008, but the provisions on airport capacity go significantly further. This Government support airport expansion where it is justified. The UK needs sufficient airport capacity to support economic growth, trade, freight and connectivity across the country. Proposals are, and will continue to be, assessed case by case against strict climate, environmental and economic tests.

Amendment 114 would prevent the Secretary of State using powers under the Bill to support any expansion of airport capacity and go further, by requiring a reduction in capacity. That would remove the Government’s ability to respond to real capacity constraints, even where a scheme could meet the rigorous tests I have described. This Bill is not the vehicle for making those determinations. I therefore ask for Amendment 114 not to be pressed.

Baroness Pidgeon (LD)My Lords, I thank the Minister for his detailed response. It has been an interesting debate, and I think that how noble Lords view these amendments and powers may reflect which side of the debate one sits on in terms of airport expansion. On these Benches, we are clear that we oppose expansion of Heathrow and Gatwick. I am grateful for the half support from the noble Lord, Lord Harper, for our amendments, though we clearly have different views on Heathrow expansion. We will now need to reflect on the Minister’s words—and, of course, the draft Heathrow expansion national policy statement that, as has been discussed, has been published while we have been sitting—ahead of Report in any amendments that we may wish to table then. But on that basis, I agree to withdraw the amendment at this stage.

Amendment 69 withdrawn.

Amendments 70 to 72 not moved.

Clause 7 agreed.

Amendments 73 to 75 not moved.

15:15:00

Clause 8CAA rules

Amendment 76

Moved by

76: Clause 8, page 9, line 15, leave out “CAA may by rules (to be known as “CAA rules”)” and insert “Secretary of State may by regulations” Member’s explanatory statement This amendment would provide for CAA rules to be made by regulations by the Secretary of State.

Lord Moylan (Con)My Lords, I have a lot of amendments in this group, but I assure noble Lords that a number of them are duplicative, because they seek to replace “document” with “guidance” wherever it appears in the clause. None the less, it will take me a moment to go through my amendments.

We are dealing here with the CAA’s rule-making powers. It is worth reminding noble Lords that the first part of the Bill is about consumer protection and the CAA’s role as the direct enforcer of consumer protection powers. This is a very different part of the Bill. It is about making rules. It gives the CAA huge, unprecedented powers to make rules, including ones that may have criminal penalties, and it does so with practically no supervision—certainly not by Parliament and, as far as I can make out, very little by the Minister either. That is what these amendments are intended to deal with.

The first one probes why it is necessary for the Civil Aviation Authority to have rule-making powers at all. Until recently, the rules it made emanated from the European Union; in fact, they often came through from the ICAO, trickling down in that fashion. But, for all their faults, regulations made by the European Union were not made in secret. One could see what was happening. We had, here in your Lordships’ House, a committee that reviewed regulations and statutory instruments relating to European Union legislation.

All these rules were made under air navigation orders, which are a form of statutory instrument—again, it is a parliamentary process. In future, neither will apply. There will be no scrutiny whatever. But, since these rules have been made by statutory instrument and similar in the past, a question arises: why should they not be made in that fashion in the future?

The Minister said—or I may have read this somewhere in some of the supporting documentation—that there is a backlog of 100 or so of these that have to be got through, and that using parliamentary time for this purpose is not appropriate. It is disturbing to think that there is a backlog, but that is not an excuse in itself. After all, we are all being made to sit here in Grand Committee for five hours rather than four, and for three hours on a Tuesday morning. There is no lack of parliamentary time for considering statutory instruments. We are all being held to the last, and we work very hard. There is no excuse that there is no room for them when the Chamber is full of debates on subjects such as tackling child poverty, rather than legislating, which is what it should be doing while we are in here. We will carry on in here; we will do the statutory instruments and put the time in, so there is no problem there.

At an earlier stage—I cannot remember whether it was on our first day in Committee or at Second Reading—the Minister said he had a trump card. He said that the Delegated Powers and Regulatory Reform Committee thought that it was appropriate for this regulator-led rule-making approach to be adopted. But he did not read the next sentence:

“Inherent in the proposition is that CAA made rules would be highly technical in nature”.

But this Bill does not limit the CAA to making rules that are highly technical in nature. It does not limit it simply to implementing ICAO powers.

In fact, this has caused concern to another committee of your Lordships’ Housethe Constitution Committee. The chairman of that committee, my noble friend Lord Strathclyde, has written to the Minister saying among other things that:

“This Bill strengthens the secondary law-making and rule-making powers of both the Civil Aviation Authority and the Secretary of State”

and that this

“will, by the nature of negative parliamentary approval of secondary legislation, be subject to minimal parliamentary oversight. We are concerned that this will result in a scrutiny gap”.

We will wait to hear, but so far the Minister has had no answer to that.

So my first question iswhy should we make such a dramatic change at all? Secondly, if there is going to be a rule-making power of this character, the Secretary of State should publish the underlying principles. It is not all given to the Secretary of State: it is for the Secretary of State, following the enactment of this Bill, to decide which rule-making powers are given over. There is no limit in the Bill on what those powers are. The second amendment, Amendment 77, would require at least a statement of principles, in advance of enactment of the Bill, as to what basis the Secretary of State is going to use for deciding which powers should be transferred over into this new process. Amendment 79 would require consultation by the Civil Aviation Authority when making rules. There is no requirement for consultation in the Bill.

Amendment 81 in my name probes why the Secretary of State’s priorities and objectives statement is described as a “document” rather than “guidance”. As I said at Second Reading, this is the oddest part of the Bill. It says that the Secretary of State is allowed to issue a document that gives guidance to the CAA on what the Government’s priorities are in relation to rule-making. The word “document” is used and the word “guidance” is avoided. I fear that that is a deliberate choice. The word “guidance” has a legal weight to it; we understand what guidance is in relation to the action of public bodies and how they are bound to it, but we do not understand what obligation a public body has to pay attention to a document issued by the Secretary of State. Does it have the weight of guidance? What weight does it have? I am trying to replace it with the word “guidance” so that we have clarity.

Then we come down to this further pointthe Bill prohibits the Secretary of State from issuing this “document”, which I would change to “guidance”, without the agreement of the Civil Aviation Authority. This is truly remarkable. I do not think that I have ever come across an example where a regulated body acting on behalf of the Secretary of State can refuse to accept the document or guidance that the Secretary of State is going to issue. I raised the point at Second Reading, and the Minister made no defence, although no doubt he is better prepared now—but what could it possibly be, and how could your Lordships possibly agree to such a thing?

There are other matters here. For example, on Amendment 98. The Bill states that the Civil Aviation Authority “may” publish a consolidated set of rules so that people can look at them. That is a good idea, but it would be a better idea if the Bill said that it “must” publish a set of consolidated rules. How could this be left to the discretion of the Civil Aviation Authority? Then the Bill has the cheek to say that anybody who is so impertinent as to ask for a printed copy of that set of rules can be charged a fee, with no limit placed on the fee or on how that might be used. My amendment would take away the fee.

This whole section gives new and unprecedented powers. There is no justification given for them and it is very difficult to understand why the Government would want to do this. I have respect for the Civil Aviation Authority because, as a safety regulator, it is of the highest quality. It is in the box of good regulators; there are bad regulators, but the CAA is not a bad regulator. I do not like to say something disobliging about the CAA, but it seems that this Bill has been written as an enormous power grab by the Civil Aviation Authority. It muscled its way into the digital markets Act in relation to consumer protection, and now it is taking over a whole swathe of rule-making powers. I just remind the Minister that, when we voted for Brexit, one thing we voted for was that rules should not be made by unelected bureaucrats. This Bill moves from a system where there is some scrutiny and understanding of the process and some parliamentary scrutiny of how these rules are made, to one where they are all being made by unelected bureaucrats, without supervision. It is a retrograde step, and not one that we should support. I beg to move.

Lord Tunnicliffe (Lab)My Lords, I have Amendment 78 in this group. I shall only say a few words, and I suppose the very few words I could say are that, if we are to get new powers that may affect pilots, we wish to be consulted. In many ways, it is as simple as that. Hopefully, the Minister can give us a better feel for what this piece of legislation will be used for. I find myself almost agreeing with the noble Lord, Lord Moylan. If we are to have powers where we are not clear what they will be used for and what their extent will be, there are two sensible outcomes: either you do not bother with the powers, or you have an appropriate set of checks and balances to make sure that the powers are sensible.

Viscount Goschen (Con)My Lords, my noble friend Lord Moylan has done the Committee a service by bringing to our attention some of the conflicts within the Bill in terms of rule and regulation-making powers. I should add that I am a member of the Delegated Powers Committee. I have previously been a member of the Delegated Powers Committee, but I was not a member at the time that its report on this Bill was made, for reasons that I explained on Tuesday—I was not a Member of the House at the time.

This a highly complex subject and complex field, and it is very easy to get tangled up in it. Some of the principles that my noble friend has elucidated are extremely valid. The other point is that one perhaps needs to be careful what one wishes for, because I could see hundreds of very technical regulations—technical in the technological sense of the term—coming before your Lordships’ House for scrutiny. None the less, my noble friend has made the particular point around the Government choosing which regulatory process to utilise, and I think there are some real difficulties in that.

15:30:00

I refer the Committee’s attention to the Delegated Powers Committee’s report and the conclusion, which I will read as it is relatively short. Having assessed the issues that we have talked about this afternoon, the report concludes:

“Accordingly, we recommend to the House that: the power in section 61A(7) of the Civil Aviation Act 1982, read with section 61A(1), is inappropriate because its effect is to give the Government unconstrained power to decide which operational and safety aviation rules to be delegated to the CAA and consequently made without parliamentary process; and to ensure Parliament is properly able to scrutinise the scope of delegation of rulemaking to the CAA: the power in section 61A(7) should be amended to make clear the principles—

as my noble friend Lord Moylan said—

“underlying the exceptions to delegated rulemaking; and that power should be subject to affirmative procedure”.

When the Minister responds to this short debate, I would be much obliged if he could give a crisp answer to that aspect of the Committee’s recommendation.

Lord Holmes of Richmond (Con)My Lords, it is a pleasure to follow my noble friend. I shall speak to Amendment 96 in my name. It rehearses an issue that we discussed in Committee on Tuesday, but it is pertinent to this section. Essentially the point at issue is this: we have a Government who have stated that they have no desire to legislate or regulate cross-sector or cross-economy for artificial intelligence and that a domain-specific approach is preferred. I suggest that that is a suboptimal choice, but it is still a legitimate choice.

The difficulty is that every time we come to some such domain—this Bill is about aviation—the Bill is silent on AI. I appreciate that there are data protection provisions in other legislation, but that is but one specific element of artificial intelligence. I believe that when one considers the role and functions of the CAA and the positive role it could take when it comes to artificial intelligence, all the people who are subject to the CAA’s powers would greatly benefit from an AI aviation standard to deal with transparency, explainability and bias and to look to the systems that not only the CAA uses, may use or, indeed, it could be said, must use in the very near future and to AI systems that are already in use across the aviation sector.

A specific AI aviation standard could bring clarity and coherence across this industry, across the roles and powers that the CAA is responsible for and across actions. It is imperfect because it would be far better to have AI legislation and regulations that could be understood by the public, business and all of us wherever we happen to come across AI, because those flexible, agile regulations would be cross-domain, cross-sector and cross-economy, so they would deliver the clarity, consistency and coherence that you require whether you are an aviator, an investor, an innovator or a citizen. However, that is not the choice the Government have made, so I suggest it would be worth considering an AI aviation standard at least to deal with this domain. The issues go far beyond data protection, which is but one part, albeit an important part, of this, but AI is already impacting in this sector. I look forward to the Minister’s response.

Lord Barber of Ainsdale (Lab)My Lords, I begin by recording my registered interest as the president of BALPA. I strongly echo the point made so clearly by the noble Lord, Lord Tunnicliffe, about the importance of engagement with the pilot community on many of the key issues in the Bill. I very much welcome the recognition that I have heard from just about everyone in the Room of the vital expertise that BALPA members can bring to the consultations required by both the Government and the CAA in key provisions in the Bill.

I will speak briefly to Amendments 89 and 95 in my name, which are supported by the noble Lord, Lord Kirkhope. Amendment 89 seeks to remove the apparent veto given to the CAA over the document to be issued by the Secretary of State setting out their priorities and objectives for the exercise of the CAA’s rule-making functions; the noble Lord, Lord Moylan, touched on this point in his remarks. It seems a curious piece of drafting in this part of the Bill. The amendment also strongly emphasises the importance of consultations on these issues with organisations and persons with relevant interests and expertise who would be affected by the new or amended proposed rules; that will clearly include pilots.

Amendment 95 would require the Secretary of State not only to publish any directions issued to the CAA, as the Bill currently requires, but to lay any such directions before Parliament, thus allowing parliamentarians the opportunity to probe and scrutinise them. This would provide greater openness and transparency without being overly burdensome. I look forward to the Minister’s response.

Lord Empey (UUP)My Lords, the noble Lord, Lord Moylan, has conducted a forensic examination of many parts of the Bill, to which I am sure we will return at a later stage.

I shall commence by referring to Amendment 78 from the noble Lord, Lord Tunnicliffe. I agree entirely with the substance and strength of it but I will apply the same remarks to it as I did to a previous amendment he tabled, in that it is not appropriate to specify a particular trade union when it does not necessarily have a monopoly—never mind now; who knows whether it would in future. However, the sentiment is right, and I support it.

I have tabled Amendment 118. Perhaps the Minister could write to me on it before Report. We have here a situation where the CAA is getting a lot of powers and, if I interpreted one part of the Bill correctly, is almost in a position to veto a decision made by the Secretary of State. I might have picked that up wrong, but it seems to be accruing an exceptional amount of power.

One issue—it is a health and safety issue, apart from anything else—is flight-time limitations. A number of years ago, there was a major change to the relevant European directives that apply here, but, of course, flight-time limitations apply not only to airlines that operate or are based in the United Kingdom but to airlines in other jurisdictions that carry UK passengers and use our airspace. That is important. There are international agreements but, with all the changes taking place around who is regulating this area, it would be most helpful if the Minister could write to me before Report clarifying what his department believes the situation to be. This is one of the most difficult issues to deal with because safety is vital. At the same time, there is competition between the desire to have the safest possible environment and airlines pressurising for the maximum amount of efficiency. There is an in-built tension there.

Circumstances arise, be they weather-related or incident-related, in which an airport has to close and crews overshoot their time. We understand the practicalities of flying, but I want clarity on who is setting the rules for the operation of flight crews of not only UK-based airlines but airlines that use UK airspace. Those of us who fly have an investment in ensuring that the right conditions apply. We know that fatigue is a regular cause of accidents and fatalities: it has been well documented in reports, and air crash investigations frequently come up with it as a major issue. So it is important to know precisely where we stand now, given that our rule-making regime is undergoing so many changes and the CAA is accruing so many powers. We had a European arrangement prior to our departure from the European Union. I would be grateful to ensure that we have clarity on who does what and who sets the regulations.

Lord Harper (Con)My Lords, I support my noble friend Lord Moylan in two of his amendments.

On Amendment 76, my noble friend made some very good points about making sure that we have a proper parliamentary process. From a combination of listening to him and looking at the Delegated Powers Committee’s report, I am not against his argument that very technical rule changes should be done by the CAA, but that distinction is not made in the Bill. Clearly, rules that have more impact than that should remain with Ministers—obviously, with the CAA advising them—so that they are made through parliamentary procedure and receive appropriate scrutiny in the House. If there is a backlog of non-technical ones, we can put processes in place, even for a limited period, to deal with it, if that is required. That has happened before: it happened when we were putting through the various changes that were required as a result of Brexit. Both Houses set up processes to deal with the one-off process of changing our legislation. It can be done.

What I want to hear from the Minister iswhat powers do the Government intend to give to the CAA, and what powers do they intend to keep for themselves? How will they make a judgment on which powers to make rules it is appropriate for the CAA, which will have no parliamentary oversight, to have? Where Ministers will retain parallel powers, what will they be used for? As far as I can tell, that is not set out anywhere; it would be helpful if it were.

My final point is small but important. My noble friend Lord Moylan’s Amendment 91 deals with the extraordinary idea that, when the Government are issuing guidance to the CAA, the CAA somehow has a veto over whether the Government can issue the guidance. That does not make any sense to me at all. It is clear that, although the CAA rightly has operational independence in its regulatory and safety responsibilities, the Secretary of State sets out its objectives—she did so as recently as 20 April—in the letter that she sends to the chair of the CAA. Ultimately, she has the ability to hire and fire members of the board.

So it is clear who is in charge here. It seems very odd that, with this drafting, the CAA will be able to stop the Government issuing the guidance. I do not understand why that is there. It might simply be a drafting error, in which case the Minister should bring forward an amendment on Report to deal with it. If not, he should give us a clear explanation of what it is there for; I genuinely do not understand it. My noble friend Lord Moylan has done us a service by spotting this and highlighting it to the Committee.

With that, I draw my remarks to a close. I look forward to hearing from the Minister in due course.

15:45:00

Baroness Grey-Thompson (CB)My Lords, I will speak briefly to Amendment 80 in my name and that of the noble Baroness, Lady Brinton. Although this amendment sits in this group, there is considerable overlap with the amendments that I had on day one in Committee. This amendment would require the CAA to publish a disability impact assessment before implementing significant new regulations. The thought behind the amendment was to put disability rights higher up the priority list, while ensuring there is a better understanding of the needs of disabled people and that they receive both equal and equitable treatment. I am very interested in the Minister’s view on this amendment.

Baroness Pidgeon (LD)My Lords, this is a substantial group that touches on the constitutional and regulatory framework at the heart of the Bill. Amendment 102, in the name of my noble friend Lady Grender, would change the power in Section 61A(7) of the 1982 Act to the affirmative procedure, in line with the recommendations of the Delegated Powers and Regulatory Reform Committee. This House takes those recommendations seriously and I am sure the Government do as well. When Parliament is being asked to delegate significant rule-making powers to the CAA, the least we should expect is meaningful parliamentary oversight of that delegation. I hope the Minister can support this.

Several of the amendments tabled by the noble Lord, Lord Moylan, in this group probe the curious decision to describe the Secretary of State’s priorities and objectives as a document rather than guidance. He made some interesting points in that it has implications for the enforceability of the Bill. Amendment 83 asks that this document address connectivity between the nations and regions of the United Kingdom, which we strongly support.

Amendment 80, tabled by the noble Baronesses, Lady Grey-Thompson and Lady Brinton, would require a disability impact assessment before significant new regulations and speaks to obligations that should be automatic—these are not optional. We should not have to say, in this day and age, that disabled passengers and those with reduced mobility deserve to have their needs considered systematically before regulations are made, not just retrofitted as an afterthought once a problem emerges. Yet the experience of disabled travellers tells a very different story. We have seen wheelchairs damaged or lost in transit, and passengers left on aircraft without explanation or assistance, long after others have disembarked. We have seen accessible services withdrawn or downgraded, with no prior assessment of the impact on those who depend on them. These are not isolated incidents; they reflect a culture in which the needs of disabled travellers are treated as a secondary consideration, rather than an absolute core service.

A disability impact assessment requirement before significant regulatory change would begin to change that culture. It would require the CAA to ask the right questions at the right time, to engage with disabled people and their representative organisations and to put on the record its assessment of how proposed rules will affect those with protected characteristics. This is not just a bureaucratic issue. It is the minimum standard we should expect of a modern regulator. We on these Benches strongly support the noble Baronesses in pressing this point, and we look forward to hearing a response from the Minister.

Lord Hendy of Richmond Hill (Lab)My Lords, this group concerns Civil Aviation Authority rule-making. I begin with the amendment from the noble Lord, Lord Moylan, which would require aviation safety regulations to continue to be made by the Secretary of State, and on which the noble Lord, Lord Harper, also spoke. That would prevent the delegation of technical rule-making to the Civil Aviation Authority, which is a central purpose of the Bill. As I said at Second Reading, the current process risks the UK falling behind its international safety obligations. Delegating technical rule-making to that authority will allow the regime to keep pace with international standards and industry change, while retaining robust safeguards, ministerial oversight and parliamentary accountability. As I will say on a number of amendments in this group, the Bill is designed to create a quicker, more responsive regulator-led system, without removing proper democratic controls.

The words of my noble friend Lord Tunnicliffe at Second Reading strongly resonated with me then, as they do now, but I note that the Delegated Powers and Regulatory Reform Committee clearly recognised a case for such an approach. The noble Lord, Lord Moylan, referred to the letter from the chair of the Constitution Committee, which as yet I have not seen but will obviously fully consider when I do. I will reply to it as soon as I can and take on board all those matters that need to be considered in the Bill before Report.

Lord Moylan (Con)The argument is that these rules have to be made by the CAA because parliamentary scrutiny slows things down and there is a risk that we fall behind meeting our international obligations. That is the case for change, but how often in the past have we fallen behind our international obligations using the existing system?

Lord Hendy of Richmond Hill (Lab)I will certainly consider what the noble Lord says and respond to him. I am sure that what I have said is correct, but I will produce an answer for him as soon as I can.

Amendment 102 from the noble Baroness, Lady Grender, and Amendment 77 from the noble Lord, Lord Moylan, respond to the Delegated Powers and Regulatory Reform Committee’s recommendations. Amendment 102 would move the relevant regulation-making power to the affirmative procedure, while Amendment 77 would require the Secretary of State to publish principles explaining how the power to prevent CAA rule-making in certain areas would be used.

I am grateful to both noble Lords for seeking to address the committee’s concern. The power is important because it helps to define the boundary between the Civil Aviation Authority and the Secretary of State. We are considering these points carefully, and, as I said at the previous Committee hearing, I fully intend to return before Report. I strongly note the advice of the noble Viscount, Lord Goshen, to be careful about what we wish for, given the possibly hundreds of technical amendments. On that basis, I hope the Committee notes that I will fully answer the points of the Constitution Committee and the Delegated Powers and Regulatory Reform Committee, and that noble Lords will not press those amendments at this stage. My noble friend Lord Tunnicliffe’s amendment, which is supported by the noble Lord, Lord Empey, would require the CAA to consult the British Airline Pilots Association. The Bill already requires the CAA to consult. The Secretary of State will expect it to consult appropriately with all relevant stakeholders, and the British Airline Pilots Association will of course be able to respond to consultations. However, a specific duty to consult that organisation in all cases would not be appropriate, because, as the noble Lord, Lord Empey, pointed out, the British Airline Pilots Association is not the only trade union representing pilots, and pilots are not the only people affected by CAA rules. Nor would it be proportionate to require that trade union to be consulted on every rule, including matters unlikely to affect pilots. I hope that reassures my noble friend. I will, of course, be happy to meet him to discuss how consultation will work in practice.

The next amendment from the noble Lord, Lord Moylan, would give the Secretary of State a power to direct the Civil Aviation Authority to consult specific persons. As with the previous amendment, I recognise the importance of appropriate consultation. However, new Section 61G, inserted by Clause 8, already enables the Secretary of State to direct the CAA in how it uses its rule-making functions, including by requiring consultation with specific parties. The amendment is therefore unnecessary and I ask the noble Lord not to press it.

Amendment 80 from the noble Baroness, Lady Grey-Thompson, would require the Civil Aviation Authority to prepare a disability impact assessment for significant rule changes. Accessibility is a priority for the Government, and we are committed to ensuring that anyone who wants to fly can do so without barriers. The Civil Aviation Authority is already subject to the public sector equality duty and must have due regard to equality impacts when making rules. As the noble Baroness, Lady Pidgeon, remarked, that should be considered automatically where appropriate. It includes careful consideration of the impact on disabled people and people with reduced mobility. I hope that reassures the noble Baroness and that she will not press her amendment, but, as I said on Tuesday, I am considering the many powerful points raised about disabled travellers and what we can and should do further in this Bill.

I will deal next with the 10 amendments from the noble Lord, Lord Moylan, which would replace references to a document setting out the Secretary of State’s priorities and objectives with references to guidance. As he notes, the distinction matters. This is not statutory guidance; it is intended to be an agreed administrative framework and work programme for the CAA’s functions. That approach allows Ministers to set clear expectations, maintain appropriate oversight and secure visibility of future rules, while respecting the CAA’s statutory independence. Labelling the document as guidance would weaken that intended effect. I therefore ask the noble Lord not to press those amendments.

Amendment 83, also from the noble Lord, Lord Moylan, would require the Secretary of State to explain how the CAA’s new rule-making function supports regional connectivity. The Government fully recognise the importance of strong air connectivity across the United Kingdom. However, most technical safety rules will have no direct bearing on that policy. Those wider objectives are more properly addressed through aviation strategy and policy, rather than through technical safety and operational rules. I therefore ask the noble Lord not to press this amendment.

I will speak to Amendments 89 and 91 together, as both concern the governance of the priorities and objectives document. Amendment 89, from the noble Lord, Lord Kirkhope of Harrogate, and my noble friend Lord Barber of Ainsdale, would replace the requirement for agreement with the CAA with a broader duty to consult stakeholders. Amendment 91, from the noble Lord, Lord Moylan, would similarly remove the CAA’s role in agreeing the document.

Here, I return to a common point in this groupthe Bill seeks to create a streamlined, effective system with clear roles, while preserving regulatory independence. Replacing agreement with broad consultation would duplicate consultation that already takes place on individual rule changes and would slow the process. Removing agreement would also undermine the CAA’s ability to stand behind the programme it is asked to deliver. Agreement is not a veto; it ensures the programme is credible, deliverable and consistent with the Civil Aviation Authority’s statutory duties. If agreement cannot be reached, the Secretary of State retains existing powers, including the ability to make regulations directly. I will further explore the point made by the noble Lord, Lord Harper, on this. I therefore ask noble Lords not to press Amendments 89 and 91.

The next amendment, also from the noble Lord, Lord Kirkhope of Harrogate, and my noble friend Lord Barber of Ainsdale, concerns parliamentary oversight of the priorities and objectives document. I recognise the importance of transparency. However, Ministers must retain clear backstop powers to direct or intervene quickly where appropriate. Where directions are issued, they will be published, and the Secretary of State will remain accountable, including through the Transport Select Committee. In that context, laying the document before Parliament may not add significant transparency. We will continue to reflect on the points raised but, meanwhile, I ask the noble Lord and my noble friend not to press the amendment.

I turn to Amendment 96 from the noble Lord, Lord Holmes of Richmond, on AI technical standards. Artificial intelligence and automation are already important to aviation safety, and automation has contributed significantly to the high levels of safety achieved over recent decades. The Civil Aviation Authority takes developments in AI seriously and has a developed AI strategy, which it will continue to review as technology evolves. The Civil Aviation Authority already scrutinises technology used in safety-critical systems, including AI, through expert, system-specific certification and oversight. A single framework for all AI use would not be workable, and mandatory human intervention in every decision could undermine safety by introducing avoidable human error. I therefore ask the noble Lord not to press his amendment.

I will take Amendments 97 and 98, from the noble Lord, Lord Moylan, together. They would require the Civil Aviation Authority to republish the entire rulebook whenever a new rule is made, or an existing rule is updated. The CAA rulebook runs to many thousands of provisions. Republishing it in full for even minor changes would be disproportionate, costly and time-consuming, and would frustrate the aim of an agile, consolidated rulebook. The Civil Aviation Authority will publish new rules and updates to existing rules in a timely way. I therefore ask the noble Lord not to press Amendments 97 and 98.

Lord Moylan (Con)Can the Minister give a commitment that the Civil Aviation Authority will maintain an up-to-date rulebook on its website at all times? Any changes made could simply be inserted on the website. That is what I am asking for; I am not asking for a book. The amendment says “publish”; it does say “publish a book”. At the moment, the Bill does not require the CAA to do that; it specifically exempts it from doing so.

16:00:00

Lord Hendy of Richmond Hill (Lab)The noble Lord makes a reasonable point; I will take it away.

Amendments 99 and 100, also from the noble Lord, Lord Moylan, would require the Civil Aviation Authority to provide a free paper copy of the rulebook to anyone who asks. As I have just noted, the rulebook is extremely large, so requiring free paper copies would create a significant cost and administrative burden and, frankly, could be open to abuse. It is right that the CAA may charge for that expense, while ensuring that rules remain available to view for free on its website. I ask the noble Lord not to press Amendments 99 and 100.

I am grateful to the noble Lord for Amendment 101. The provision he seeks to remove is needed to ensure that the transition to CAA-led rule-making works coherently, including by enabling necessary consequential changes to existing legislation and enforcement provisions. Without it, gaps could arise that would require further primary legislation, which would not be proportionate or efficient. This is not an unfettered power. It is limited to what the Secretary of State considers necessary to facilitate or give effect to CAA rules, and it is subject to parliamentary procedure—affirmative where it amends primary legislation and negative in other cases. That provides proper oversight while allowing the new regime to operate effectively. Therefore, I ask the noble Lord not to press Amendment 101.

Finally, Amendment 118 from the noble Lord, Lord Empey, concerns flight time limitations. The CAA is responsible for ensuring that operators comply with those regulations. It already has powers to audit and enforce compliance, and is currently reviewing flight time limitations and enforcement. That review will be published later this year and will inform the CAA’s future approach. I will write to the noble Lord on the points he raised. I hope that that reassures him, and I ask him not to press Amendment 118.

Lord Moylan (Con)My Lords, I note and am grateful for the assurance from the Minister that he will return on Report with an amendment—or amendments—that will address the points raised by the Delegated Powers and Regulatory Reform Committee. I am sure that the noble Baroness, Lady Grender, and I will study that carefully, to see whether it will allow us not to press our own amendments. Beyond that, I am afraid to say that the Minister has, I think, disappointed the Committee with his response.

I will briefly comment on the relationship between the Secretary of State and the CAA. In normal circumstances—we might take Great British Railways as an example, as it is being created at the moment—we expect the Secretary of State to issue a document setting out the Government’s priorities and to impose them on the body being regulated. However, in this case, the Minister seems to envisage a partnership arrangement—a contract of some sort—between the Department for Transport and the Civil Aviation Authority, in which the CAA can say, “No, we don’t accept that part of the contract. We want something else”.

That seems to be unprecedented, although it is possible that the Minister can find precedence for it elsewhere in the regulatory environment in which we exist. It seems unprecedented, but it also seems to requires its own supervisory structure. In the end, if the Civil Aviation Authority can decide what it is willing to do, and the Secretary of State does not have the power to issue guidance requiring it to do those things, then we have created a monster that is totally outside of our control. I hear the Minister’s justification, but, as far as I understand it, it seems to raise more questions than it answers. I beg leave to withdraw my amendment.

Amendment 76 withdrawn.

Amendments 77 to 83 not moved.

Amendment 84

Moved by

84: Clause 8, page 12, line 26, at end insert— “(g) set out how the CAA will have regard to the seventh carbon budget in exercising its functions under this Act, including any implications for aviation demand and consumer access to air travel.”Member’s explanatory statement This amendment probes whether the CAA will be required to have regard to the seventh carbon budget in exercising its functions and what that would mean for aviation demand and consumer access to air travel.

Lord Harper (Con)My Lords, let me explain what the amendment would do and the rationale for why I have tabled it. It goes back to the famous document of the noble Lord, Lord Moylan, that will be issued and seeks to add one thing to the list set out in the Bill: for the Secretary of State to set out to the CAA how it will have regard to the seventh carbon budget in exercising its functions, specifically

“any implications for aviation demand and consumer access to air travel”.

The amendment’s purpose, if I am being frank, was to make sure we could discuss this issue, because it is important and connected. A number of noble Lords have talked about the environmental impact of aviation.

Before I get on to my specific questions about the seventh carbon budget, I want to put this in a little context to make sure—although no one in this Committee would do so—that no one outside misrepresents me. I am a strong supporter of decarbonising aviation. I chaired the Jet Zero Council when I was Secretary of State, working with government, industry, airlines, airports, manufacturers, suppliers of fuel, academia and representatives of the Climate Change Committee looking at how we develop technology to ensure that we can continue flying but in a way that has less impact on the environment. As I said in our debate on the Sustainable Aviation Fuel Bill, I had the great pleasure of being on the VS100 Virgin flight to the US, which was the first flight that had 100% sustainable aviation fuel, showing that it was technically possible to deliver that with a significant reduction, in the order of 70% to 80%, in emissions. I am a strong supporter of decarbonising aviation.

I want to flag, though, the real challenge for government and the question of who makes these trade-off decisions. The current position, which I was operating under when I was Secretary of State and which the current Government have no plans to change, is this: with the net-zero target due to be hit in 2050 in statute, and the Climate Change Committee making its reports on carbon budgets, which the Government accept—Parliament will have the chance to vote on the seventh carbon budget shortly—there is a hard stop for the impact of carbon emissions. A clear path is set out by the Government for the technologies that will be needed to make sure we can decarbonise aviation and those are explained by the Climate Change Committee. But what happens if those technologies do not proceed at the pace that we hope and expect they do?

I am a strong supporter of ordinary people being able to continue to fly. The danger, which I will come on to in a minute, is that, if the technology does not go fast enough and the legislative position remains unchanged, the Government will be forced to use what is euphemistically called demand management—that means jacking up the price of flying so that ordinary people cannot fly any more. Wealthy people will continue to be able to do so because they will be able to afford it, but ordinary people will no longer be able to take their reasonably priced holidays and businesspeople will not be able to fly for essential economic activity. Those sorts of trade-off decisions should be made by Ministers, who are democratically accountable, rather than, as would actually happen, judges, when people judicially review decisions and so they would be made in the courts. That is the purpose of the amendment, and I want to test where the Government’s thinking is on that.

The Committee will be aware that the Climate Change Committee published the Seventh Carbon Budget, which covers the period from 2038 to 2042, on 26 February 2025, which, coincidentally, was my birthday, for completely random reasons. The committee recommended carbon budget 7 and the Government are required to legislate for it by the end of this month. The Climate Change Committee supports the various technologies that are needed to decarbonise aviation; it specifically sets out in the budget that the primary tool in that timeframe is sustainable aviation fuel. A number of Members of this Committee were also involved in the debates on that, so I will not rehearse this at length. There are also other technologies such as the development of hydrogen-powered aircraft for smaller and shorter-haul flights and battery-electric planes. There will also be the necessity, which the Climate Change Committee sets out, to do direct capture of carbon from the atmosphere and then store it. That is how you reach net zero.

The problem is, as I said, that the Government’s current view—it is the view I took when I was Secretary of State and I do not disagree with the Government at the moment—is that the technology the industry is developing will get us on a path to hitting the targets and all will be well and good. But there is risk involved in this process. My view is that Ministers should make the judgments about risk and should balance those things. That is why, while being a very strong supporter of decarbonising aviation, I support the position my party has reached that we should not legislate the net-zero target. If you do that, these decisions—I think my noble friend Lord Moylan talked about the judicial challenge to the Airports National Policy Statement —get challenged and end up being made by judges, not democratically elected and accountable Ministers. In the end, because Ministers are democratically elected, decisions are made by voters.

Given that we are in a position where this is in law, I just want to test the Government’s view. It is set out very clearly in the Explanatory Notes to this Bill, the Minister has said on a number of occasions and it is in the policy statement published today, that the Government support the aviation sector and understand how important it is to economic growth. On a number of occasions, Ministers have made it very clear, rightly, that they support people being able to fly to see family and friends around the world and take holidays, and all those sorts of things, and business. We talked on day 1 of this Committee about the real importance of UK trade and the amount of valuable cargo that is shipped by air, which is particularly important for an island nation such as the United Kingdom.

There are trade-offs here. If the net-zero line is legislated for, it becomes the most important thing, as opposed to one of the things you have to balance. I just want to test Ministers and listen to what they have to say. If the technology does not move quite as quickly as we would hope, are the Government planning to use the demand management measures? To be clear, those are taxes and charges that make aviation more expensive. Are they proposing to give the CAA direction in its regulatory decisions? For example, the CAA has a number of airports that have regulated asset bases and are allowed to pass on a certain amount of charges to consumers. I would not want to see the CAA making aviation and flying more expensive to reduce demand because, inevitably, that would mean that the burden would fall on people who are less well-off, and I do not think that would be reasonable.

I just want to hear from the Minister, when he responds to my amendment and the other amendments in the group, which are obviously on the same theme of the environmental impact on aviation, about where the Government think that these lines should be drawn, given that the Government say that their number one priority is economic growth. If they start slamming the brakes on aviation, they are not going to deliver economic growth and that is not really their number one priority. That is what I am looking forward to hearing from the Minister when he winds up. I beg to move.

16:15:00

Lord in Waiting/Government Whip (Lord Katz) (Lab)I meant to stand up at the start of the group, but the noble Lord, Lord Harper, was a little too quick on his feet. I just want to point out that we now have bang on an hour to finish the remaining groups, which I think that we can achieve, if we have concision in our remarks. That would be very helpful.

Earl Russell (LD)My Lords, I note the comment just made. I welcome the probing amendment in the name of the noble Lord, Lord Harper. That is useful in the Bill, so I thank him for that.

I will speak to my Amendments 106 and 107. Together, they seek to form a coherent case for environmental accountability in the regulation of civil aviation. Amendment 106 asks the Secretary of State within 12 months of the Act passing to lay before Parliament a report assessing its impact on passenger information, on low-carbon travel choices and on emissions from civil aviation. The Bill contains important consumer protection measures, but a consumer framework is only as good as the information that it generates and the behaviour that it manages to change. The amendment asks a simple question: once the Act is on the statute book, how is it actually working?

My amendment calls for a report, which must address four things. First, it must address whether consumers are receiving clear and consistent information about the carbon emissions associated with their flights. Currently, there is no standard for presenting that, and the report would help to establish whether the Act drives progress. Secondly, it must address whether consumers are genuinely comparing aviation and rail options at the point of decision. At present, they largely cannot and booking platforms are entirely siloed. The integrated comparison of journey time door to door, total price and carbon footprint and the whole booking simplicity just barely exist for people who want to be able to do that. For short-haul routes, where rail is a credible alternative, this is a serious market failure. Thirdly, and relatedly, it must address whether consumer awareness of lower-carbon alternatives to short-haul flights has improved. Evidence from France and Sweden shows that better information helps to shift consumer behaviour. Fourthly, it must address the overall emissions trajectory of civil aviation, which, as we know, is one of the most difficult to decarbonise. Demand management, through better information, has an unavoidable role to play while sustainable aviation fuels and zero-emissions flight technology continue to mature.

The amendment would also require consultation with aviation, rail and consumer representatives. It would require the report to include recommendations, not merely descriptions. If the Act is working, the report will say so. If not, Parliament will have the information that it needs to act. Amendment 107 addresses a related but distinct gap: the absence of any statutory environmental duty on the Civil Aviation Authority itself, particularly in relation to the new powers in the Bill. The duty that I am seeking is deliberately light touch. The amendment says that the CAA “must have regard to”. It does not override safety, does not prescribe outcomes and leaves the CAA to weigh its environmental responsibilities against its other functions. It would simply require those commitments to be present when decisions are made.

Three specific matters in subsection (2) are carefully drawn outreducing greenhouse gases and other environmental impacts; supporting biodiversity and natural environment, consistent with the framework in the Environment Act 2021; and improving resilience in the aviation sector to the physical effects of our warming and changing climate. This would be in the form of an annual report, which would also be published to Parliament. It might be that the amendment is clunky and not acceptable because of how I have drafted it. I am more than happy to work with the Minister between now and Report. If there is a form of wording that could capture some of this in a better way, I am more than happy to discuss it.

Finally, I will speak to Amendment 115 in the name of noble Baroness, Lady Bennett of Manor Castle. This amendment is straightforward in its purpose. It seeks to insert a new clause requiring the Secretary of State to make regulations by statutory instrument to reduce carbon emissions from private aviation. These regulations could impose restrictions on private aircraft operations, impose changes on private aircraft movements, prohibit specific categories of movements and make different provisions for different classes of aircraft. This instrument would be subject to the negative procedure.

We have not talked about private aviation yet, but it is important. There is a compelling case here. Private jet movements in the United Kingdom have grown by over 40% since 2020. The carbon emissions per passenger of a private jet are on average five to 14 times higher than those of a commercial flight, yet private aviation sits entirely outside the consumer and environmental framework that this Bill seeks to create. That is a significant gap. The vast majority of private aviation growth is coming from short-haul flights and private aviation is a big part of that. It is in precisely these segments where we have the strongest leverage to change consumer action.

We cannot meet our obligations under the Climate Change Act, as have heard, without using some of those levers. Short-haul flights and private aviation are two of the matters that we need to move the dial on. On these Benches, we have considerable sympathy for the principles contained in this amendment and I welcome the challenge. However, I am not fully supportive of the drafting. The powers in subsection (2) of the new clause are substantial. They are broad, restrictive changes prohibiting entire categories of movements, yet subsection (3) subjects them only to the negative procedure. For powers of this reach, the affirmative procedure would provide more appropriate parliamentary scrutiny. We would welcome a clearer policy framework sitting behind the regulation-making powers, rather than leaving it entirely to ministerial direction. To conclude, I hope that the Minister can tell the Committee what assessment the Government have made of private aviation emissions and whether a levy, perhaps proportionally hypothecated towards sustainable aviation, has been considered alongside perhaps a restrictions-based approach. How do the Government plan to regulate that sector, considering that it is not mentioned in the Bill?

Baroness Pidgeon (LD)My Lords, this group of amendments focuses rightly on the environment and climate impacts. My noble friend Lord Russell has set out clearly Amendments 106 and 107. They are modest, sensible asks and the Government should not find them difficult to accept, given that the aviation sector accounts for a significant and growing share of UK emissions and that it is one of the hardest sectors to decarbonise. We strongly support my noble friend’s amendments and look forward to hearing from the Minister how the Government intend to address this gap.

Lord Moylan (Con)My Lords, between them, my noble friend Lord Harper and the noble Earl, Lord Russell, have drawn attention to the unreality of this debate. Everything in this Committee and everything to do with this Bill is about growth—economic growth, building new airports, having a new runway at Heathrow and so on. However, elsewhere there are, as I mentioned, government policies and statutory commitments that are undeliverable unless that growth is restricted. It is a great advantage to the Committee that the two noble Lords between them have drawn attention to that.

My Amendment 111 asks for a review of the cost of sustainable aviation fuel and takes us back to the issue that we discussed when the Sustainable Aviation Fuel Act was before your Lordships’ House.

Ministers have said that SAF costs are subject to fluctuation but are currently based on costs of £3.30 per litre for conventional SAF and approximately £4 per litre for power-to-liquid fuel. They have also set out estimated RAF market costs rising from £16.5 million in 2025 to £187 million by 2040 as a result of SAF. That has been reported as the RAF spending more than £1 billion over 15 years on switching to sustainable jet fuel. Wider commentary has suggested that sustainable aviation fuel can cost up to eight times as much as conventional jet fuel.

It matters because, as we know, the mandate requires an ever-increasing amount of SAF to be used by the commercial aviation sector. For passengers, it will mean higher fares, and therefore less demand. For airlines, it may mean higher operating costs, but also weaker competitiveness and a reduction in aviation activity. If the demand is falling, the number of planes in the air will be fewer, the number of destinations served will be fewer and the amount of regional connectivity that we can look forward to will be less.

If the Government are imposing this policy, they should be prepared to assess openly what it means for airfares, airline costs, public expenditure and national security for the UK. My amendment calls for the Government to make that assessment within two years—plenty of time—of the passing of the Bill and to publish it. It is the least they can do.

Lord Hendy of Richmond Hill (Lab)My Lords, this group concerns environment and climate impacts. I am grateful to noble Lords for their amendments. I will address each in turn, but first I will make two common points that apply across the group. The Government recognise the need to reduce aviation emissions and to ensure that environmental impacts are properly considered. At the same time, many of the amendments would duplicate existing statutory duties, reporting arrangements or wider decarbonisation policies. Where I refer to duplication, proportionality or the need to treat aviation as a whole sector, these are the common justifications I have in mind.

I begin with Amendment 84, tabled by the noble Lord, Lord Harper. This amendment would require the Secretary of State to set out how the CAA should consider the seventh carbon budget when exercising the new powers in the Bill. I agree that aviation’s climate impacts must be properly considered, but the CAA already has statutory responsibilities in this area, including a legal duty independently to monitor, assess and report on the environmental protection performance of the UK civil aviation sector through the UK Aviation Environmental Review . Domestic aviation emissions have been within legally binding carbon budgets since the first carbon budget, and the Government have laid legislation to include international aviation emissions from the sixth carbon budget, beginning in 2033.

The Government are also supporting greener aviation through the sustainable aviation fuel mandate, the Sustainable Aviation Fuel Act, airspace modernisation and funding for low and zero-emission aircraft technologies. Most safety and operational rules are technical and have limited environmental impact. Where environmental effects are relevant, the CAA will consider them as part of rule-making. A blanket requirement would be disproportionate, add red tape and risk slowing the benefits of delegated rule-making. However, I hear the noble Lord’s question about a political decision on whether demand management might be required. This Government support the ability of ordinary people to fly, so I will consider this point further. In the meantime, I ask the noble Lord to withdraw Amendment 84.

Amendment 106, on supporting low-carbon travel choices, was tabled by the noble Earl, Lord Russell, and spoken to by the noble Baroness, Lady Pidgeon. The Government agree that passengers should have clear information and that aviation policy should support environmental objectives. However, a further statutory review is unnecessary. The Civil Aviation Act 2012 already requires the Civil Aviation Authority to publish information and advice on the environmental effects of civil aviation, including measures to reduce, control or mitigate adverse effects. This is again through the annual UK Aviation Environmental Review . The CAA also works to improve consumer information so that passengers can make informed choices. The Government keep aviation policy impacts under review, informed by CAA reporting and wider climate work. I am afraid that Amendment 106 would add process without improving the evidence base, so I ask the noble Earl not to press it.

16:30:00

Amendment 107, also from the noble Earl, Lord Russell, would place a duty on the CAA to have regard to climate and environmental targets and to report annually on compliance. As I just noted, the CAA already has statutory environmental reporting duties through the UK Aviation Environmental Review . It must also, in relevant areas, take account of environmental objectives set by the Secretary of State and enforce international standards, including aircraft CO 2 certification and emissions rules. Amendment 107 would duplicate existing duties and reporting arrangements. I therefore ask the noble Earl not to press it but will be happy to further discuss the reporting requirements with him.

I turn to the amendment tabled by the noble Lord, Lord Moylan, requiring a report to Parliament within two years on the impact of the sustainable aviation fuel mandate. Noble Lords will be familiar with these issues from the recent passage of the Sustainable Aviation Fuel Act 2026. The mandate was designed with consumer costs in mind and already includes review points so the Government can respond if market conditions change. A further statutory review would duplicate existing mechanisms, add process without substance and risk delaying a central decarbonisation policy. I note that the noble Lord attempted to insert a very similar provision, which was disagreed, into the Sustainable Aviation Fuel Act 2026 during its passage through your Lordships’ House, and I ask him not to press the amendment.

Amendment 115, tabled by the noble Baroness, Lady Bennett, and spoken to by the noble Earl, Lord Russell, is on private aviation. The Government are clear that reducing aviation emissions, including from private aviation, is an important priority. Private aviation is emissions intensive, and it is right that all parts of the sector contribute fairly to decarbonisation. However, private aviation covers a wide range of purposes, including emergency response, specialised logistics, government and military use, as well as corporate and leisure travel, and any approach must reflect that diversity.

The Government’s approach is to decarbonise aviation as a whole, through measures such as sustainable aviation fuel, airspace modernisation and more efficient aircraft. Private aviation is not outside that framework. Domestic aviation emissions are already captured within the carbon budgets under the Climate Change Act 2008 and, as I said, international aviation emissions are being brought fully into scope from the sixth carbon budget onwards.

The Government have also acted through taxation. Building on the 50% increase in air passenger duty rates announced at the Autumn Budget in 2024, the Government will extend the higher air passenger duty rate to all private jets over 5.7 tonnes from April 2027. Amendment 115 would instead create a separate regulatory regime for one part of aviation, with wide powers to impose restrictions, charges or prohibitions. Given that most emissions come from commercial aviation, and that private aviation is already within the wider net-zero framework, we do not consider that proportionate. I therefore ask that Amendment 115 is not pressed.

Lord Harper (Con)My Lords, I am mindful of the Whip’s injunctions on timing. Just very briefly then, before I seek leave to withdraw my amendment, my objective was to probe the Government’s policy, and particularly to make sure that aviation remains affordable for ordinary people to be able to use and that its cost does not rise significantly. Given that the Minister has given me a clear commitment to write to me on that specific point or those related points, I am content to seek leave of the Committee to withdraw my amendment.

Amendment 84 withdrawn.

Amendments 85 to 102 not moved.

Clause 8 agreed.

Amendment 102A not moved.

Clause 9 agreed.

Amendments 103 to 107 not moved.

Amendment 108

Moved by

108: After Clause 9, insert the following new Clause— “Assessment of impact of business rates revaluation on airport services and consumer protection(1) The Secretary of State must, within three months of the day on which this Act is passed, publish an assessment of the impact of the 2026 business rates revaluation on the provision and regulation of airport services and consumer protection measures.(2) The assessment under subsection (1) must include an assessment of the impact of the revaluation on—(a) the cost, quality and resilience of airport services provided to passengers and other users,(b) airports’ ability to meet consumer protection obligations and service standards,(c) airport investment in facilities and infrastructure used for the provision of airport services to consumers,(d) airport expansion and infrastructure development in order to meet regulatory requirements,(e) the financial sustainability of airports and the effects of that on consumers,(e) regional air connectivity, and(f) the regulatory stability of the airport sector.(3) The Secretary of State must lay the assessment before Parliament.”Member’s explanatory statement This amendment would require the Secretary of State to publish an assessment of the impact of the 2026 business rates revaluation on the provision and regulation of airport services and consumer protection, including its effect on passenger outcomes, service standards, investment, infrastructure, financial sustainability, regional connectivity and regulatory stability.

Lord Harper (Con)My Lords, in moving Amendment 108 in my name, I will also speak to Amendments 116 and 117, also in this group. I am afraid it is my group, I suppose. This seems an appropriate moment, given that it is about economic impacts and competition, to remind the Minister that when on Tuesday my noble friend Lord Moylan and I referred to the Government’s commitment to reduce the administrative burdens on business by 25% during this Parliament, he said he could not furnish us with the details immediately but confirmed that he would come back to us today with whatever information he was able to lay his hands on. Since this is effectively an economic-related matter, I thought I would mention that at the beginning of my remarks, and I hope that when he winds up he can give us what he was able to find. If he was not able to pull it all together comprehensively, if there is more to come, I am sure my noble friend Lord Moylan and I will be content for him to write to us with that further information. I wanted to give the Minister a bit of notice rather than springing it on him at the end.

Amendment 108 is distinct and Amendments 116 and 117 are effectively linked. I will deal with Amendment 108 first. If noble Lords are wondering why I have raised it, it is because part of the Long Title of the Bill is to:

“Make provision for the protection of purchasers and users of air transport and airport services”.

One of those protections is obviously to look at the cost of those services and what services people get. One of the things that is going to drive up the cost of those services is the 2026 business rates revaluation, which has had a particularly significant impact on our airports. Rateable values will increase more than sixfold at some regional airports. To be fair, the Government have put in place transitional relief, but all transitional relief does is delay things. Most airports are going to see their rate bills more than double in the next three years. I do not want to spend too long talking about rates in general, but they are a particularly bad tax because they are not linked to the profitability of a business. They are not like corporation tax, where you pay only if you make a profit. They are a cost that hits your business above the line. Given that the aviation sector in general is not a high-margin business, it is inevitable that the cost of that business rates revaluation is inevitably going to flow through to the customers of airports—that is, the airlines—and they will inevitably have to pass that cost on to consumers.

From the figures that I have managed to lay my fingers on, for example, Manchester Airport is going to see an extra £4.2 million per annum on its business rates bill. That is a significant percentage increase, going up to £18 million. Bristol Airport is going to see an increase of just over £1 million, taking its bill to just over £5 million. Those organisations have explained the consequences. Manchester Airports Group, for example, has said:

“Airports were already some of the highest rates-payers in the country and were prepared to pay significantly more. But increases of more than 100% mean we have to look again at our plans to invest more than £2bn in our airports across the UK over the next five years. It is inevitable air travel will become more expensive”.

I draw attention to that because the Government’s position is that aviation and airport expansion are an essential part of driving economic growth, and they keep telling us that economic growth is their number one priority. It seems to me that having a significant increase in your business rates bill of more than 100% over the next three years in a sector where margins are quite tight is inevitably going to increase the price to consumers, business travellers and those shipping cargo in a way that is not going to drive economic growth but do the opposite.

The purpose of my new clause is to say that the Secretary of State, within three months of the day that this Bill is passed, should publish an assessment—that is all; we are not telling her to change the taxes—of the impact of that business rates revaluation on the provision and regulation of airport services and specifically to look at the cost, the ability of airports to meet their obligations, the investment that airports have available to invest in the facilities and infrastructure, their ability to expand the financial sustainability of airports, the effect on consumers and, an important issue that has come up in this Committee before, regional air connectivity.

All the amendment does is ask the Government to assess the impact of that business rates revaluation on this sector. That seems to me to be a reasonable request. It would also have the benefit that if the amendment were accepted and that assessment was done by the Secretary of State for Transport and it showed that the business rates revaluation had a negative impact on the sector, it would give the Secretary of State the evidence base that she could use to have a good conversation with the Chancellor about changes that might be needed to reduce the burden on the sector. There seems to be no downside to producing that information. It might be a useful tool for the Secretary of State and provide some transparency for business.

The second two amendments that I have tabled, Amendments 116 and 117, are related to the conversations we had earlier about the role of the CAA and the cost of flying. The first is about adding to the CAA’s duties when it is exercising its economic regulation functions. It should have a primary duty to promote effective competition in airport operations, services and infrastructure where that competition can deliver benefits to passengers, airlines and operators. The CAA’s objectives are set out in the letter that the Secretary of State sends to the chair of the CAA. The six priorities for 2026-27 in the letter sent by the Secretary of State to the chair of the CAA on 20 April are growth and innovation, economic regulation, airspace modernisation, decarbonisation, modernising its consumer focus and efficiency, effectiveness and resilience.

16:45:00

Nowhere in there does it talk about the use of competition to drive down the cost of delivering aviation services that the CAA regulates for consumers. It seems to me that perhaps flexing one of those requirements and adding competition would be very sensible. I have tabled the amendment to have the discussion with the Minister. It is not for me to tell him how to respond, but I might be content if he says that, when she sends her next annual letter to the CAA, the Secretary of State will look at whether it is appropriate if, in one of the economic bits of the letter, competition ought to be one of the things the CAA has as an objective when it is exercising its decisions. I think that would be a helpful move in improving its ability to grow the sector.

Amendment 117 is just to ask the Minister to flesh out a bit the conversation we had at Second Reading. It concerns the CAA’s power to impose pro-competition remedies at Heathrow, and it specifically says,

“Where the CAA determines that a lack of effective competition … is adversely affecting users of Heathrow Airport, it may impose”

remedies, including how it operates airport facilities, separating airport functions and governing capital investment. I have put that in because we had a discussion when we were talking about Heathrow. My noble friend Lord Moylan referred to the regulated asset base at that airport. The CAA is currently consulting on changes that will be required. I think it has effectively conceded that the current model is not adequate, so it is consulting on changes that it might need in order to facilitate the £49 billion investment in the third runway. When I asked this at Second Reading, the Minister confirmed, if I remember correctly, that the CAA did have these powers, but I want to test that in a bit more detail.

It is consulting on four potential models. Two of them are, if you like, incremental changes. “Enhances the existing framework” is the first one. The second one looks at a longer-term price control method. The two others are a bit more radical. One is looking at competitive delivery of the infrastructure, and the final one is on alternative developers. That is where you could potentially have, for example, a terminal being built and operated by another company in competition with Heathrow Airport Ltd at Heathrow. Obviously, the point of the competition is to drive down the costs of delivering those services to the airport’s customers, which are the airlines, and by reducing the cost to the airlines, you enable the airlines to reduce the costs to passengers.

I asked this question at Second Reading. I am hoping to probe it further with this proposed new clause and give the Minister’s officials the opportunity to provide him with the information in a bit more detail. I obviously do not know what the CAA is going to do—it is independent. If it comes back with one of the more radical options, I want to test, first, whether it actually has the power to do that with its existing regulatory framework. If it wanted to do one of the more radical ones, would the Government have to bring forward legislation to enable it to do so?

I also just want to take a view on the fact that, given that the Government have set out which of the two options for the third runway they prefer, which is the more expensive one, the Government clearly, therefore, have a policy need to deliver an economic regulation model that can fund it. The Government have been very clear, rightly, as I was when I was the Secretary of State, that the CAA does this economic regulation independently, but if they are committed to airport expansion, they have to be convinced that the model the CAA delivers is going to deliver Heathrow Airport.

My final question is to test whether the Government are going to remain completely hands-off and allow the CAA to finish its consultation, decide which of those four models it prefers and just go along with whatever the CAA says or are the Government going to take a view on whether what the CAA has come up with is actually going to enable it to deliver the Government’s preferred choice of the more expensive £49 billion option for the third runway? That was the purpose of tabling the amendment, and I hope that the Minister can set out some detailed answers when he responds.

Lord Moylan (Con)My Lords, I wholly support the amendments proposed by my noble friend Lord Harper. I keep coming back—I must—to the absolutely cruel imposition of increased business rates on airports. They are a smash and grab of deliberate design; they can have no effect other than to make aviation less accessible to ordinary people, despite what the Minister has just said is the Government’s policy. Equally, if the CAA is to have these very substantial new powers, it is reasonable to ask why it should not also have a clear duty to promote competition. For that reason, I strongly support the amendments in this group.

Lord Hendy of Richmond Hill (Lab)I thank your Lordships for the debate on this group regarding economic impacts and competition, and I thank the noble Lord, Lord Harper, in particular for his amendments. I turn first to his amendment on the impact of business rates revaluation. At the Budget, the Valuation Office Agency announced updated property values from the 2026 revaluation. This revaluation is the first since the pandemic to result in significant increases in rateable value for some property, which includes some airports. The Government recognise the impact that these changes can have. We have considered this carefully and have put in place measures to ensure that the effects are manageable. We are delivering a support package worth £4.3 billion over the next three years, including a £3.2 billion transitional relief scheme. That provides more generous support to the largest ratepayers, including airports. It caps increases in airport bills arising from revaluations to just over double by 2028-29, before any supplements and reliefs are applied, preventing the much larger increases they otherwise would have seen.

The Government believe these arrangements strike the right balance, reflecting updated property values while ensuring a smooth and manageable adjustment for airports. Looking ahead, however, the Government recognise that businesses with decades-long capital cycles need stability and predictability to deliver capital investment plans. To provide this, the Government published a call for evidence around the receipts and expenditure valuation methodology and its impacts on long-term, high-value investments. This will allow the Government to work constructively with airports and other ratepayers ahead of the 2029 revaluation. I should also note that if an airport, or indeed any business, disagrees with their business rates valuation, they may challenge it with the Valuation Office Agency and, if that fails to produce a satisfactory outcome, the affected party may escalate the case to the independent Valuation Tribunal. As a result, I hope the noble Lord feels able to withdraw this amendment.

I turn to Amendment 116. The Government agree that effective competition, where it can be delivered, plays an important role in improving outcomes for passengers, airlines and the wider sector. The CAA already has a clear statutory role in economic regulation and a duty to further the interests of air passengers, both of which it actively applies. The Civil Aviation Act 2012 provides a well-established framework designed to give the Civil Aviation Authority clear focus on furthering the interests of passengers. The framework ensures that competition is properly considered as a means of furthering those interests, while allowing the regulator to take a balanced and proportionate approach in markets where competition may not always be effective. It is important that the CAA continues to have discretion in how it regulates airports, including by balancing the promotion of competition with other ways to further the interests of consumers where those are more appropriate. Although the CAA’s competition remit is targeted, the Competition and Markets Authority is able to intervene when wider competition issues arise.

We recognise that there are arguments for looking more broadly at the CAA’s role in relation to competition, but so far we have seen no evidence that the current framework is not working effectively, although we will continue to keep it under review. If we consider it necessary, we will, indeed, as the noble Lord, Lord Harper, suggested, add competition to the next letter to the Civil Aviation Authority chair.

Changes in this space could have wide-ranging implications for investment, passenger costs and regulatory independence, so it is important that those impacts are fully considered before any changes are made. Amendment 116 does not address those broader questions, and it risks cutting across a more considered approach. The proposed reporting requirement is unlikely to add significant value, given the CAA’s existing transparency and reporting obligations. For those reasons, I hope the noble Lord feels able not to press his amendment.

Finally, Amendment 117 seeks to enable the CAA to impose pro-competition remedies at Heathrow. As noted, the CAA already has a well-established framework of powers relating to economic competition. These enable it to act where competition is not working effectively. It can impose and enforce licence conditions on dominant airports and has concurrent competition powers alongside the CMA. In short, the tools to act are already in place, and competition consideration is already embedded in the statutory duties.

We note, as the noble Lord did, that the CAA is currently consulting on aspects of the future regulatory framework at Heathrow, including options, as he mentioned, that relate to competition and the delivery of airport infrastructure. In answer to his question, the CAA does not believe it needs further powers if it chooses a more radical option. On his second question, about whether the Government will take a view on the CAA’s choices, I cannot say at the moment, but since the Heathrow expansion national policy statement has been launched, we will no doubt be able to in due course. I have no doubt that the noble Lord is engaging with those processes and, for that reason, we do not believe that this amendment is necessary.

The noble Lord asked on Tuesday about the department’s role in reducing the administrative burden of regulation on business by 25% in this Parliament. I can confirm that the department is working closely with regulators and with the Department for Business and Trade to identify legislative and practical changes to deliver that. We have already made progress: for example, changes to rules for large vehicle licence holders with diabetes, which reduce costs by several million pounds a year; and there are some examples of Civil Aviation Authority initiatives that contribute to a reduction in the administrative burden incurred by businesses, including investment in systems modernisation, the recent update to the Airspace Coordination and Obstacle Management Service, and the general aviation licensing and training simplification programme. I am very happy to write to him further, and I will do so.

Lord Harper (Con)My Lords, I am grateful. On Amendment 108, I am very pleased that the Government are consulting on the process by which business rates revaluations are done for airports, given the necessity for capital expenditure over a significant period. I will look carefully at the results of that consultation. I am sure airports will have been, and are, responding to that consultation to make the arguments that they need to, so that is welcome.

On the extent to which competition should be one of the CAA’s objectives, I accept that the CAA has to balance objectives, and that is very sensible. If it were added to the Secretary of State’s letter, which sets out a range of objectives for the CAA, then the CAA would be able to balance those objectives as it is taking its decisions. I think that that is perfectly appropriate. As I said, all I would ask is that, when Ministers are formulating the next letter, they think about whether an explicit mention of competition is set out as part of one of the economic sections of that letter.

Finally, the Minister has confirmed more explicitly than he was able to at Second Reading that the CAA has all the powers it needs to do any of the options, including the more radical ones. I am sure that, when we no doubt get the opportunity in the House to ask questions about the Heathrow document, whatever it will now be called—

Lord Hendy of Richmond Hill (Lab)It is the Heathrow expansion national policy statement.

Lord Harper (Con)I thank the Minister for that prompt. When we get that opportunity, we can no doubt ask whether the Government will take a view. For very sensible reasons—and I am not trying to be mischievous—I was always very careful to let the CAA get on with their economic regulations, and there is a very strong argument; it is simply that, if the Government are very wedded to delivering the Heathrow third runway, they have to make sure that they are confident that the economic model will finance it. We will no doubt come back to that. With that, I beg leave to withdraw Amendment 108.

Amendment 108 withdrawn.

Amendments 109 to 123 not moved.

17:00:00

Clause 10Power to make consequential provision

Debate on whether Clause 10 should stand part of the Bill.

Member’s explanatory statement

Opposition to this clause standing part is intended to delete a Henry VIII provision.

Lord Moylan (Con)My Lords, I shall briefly oppose Clause 10 standing part of the Bill. This is a wide-ranging Henry VIII power, and wholly unnecessary. In a letter sent by the Civil Service to the Delegated Powers Committee, civil servants identify every Act that this Bill interacts with and states that all amendments necessary are already made in the Bill. Why should the Government be seeking a Henry VIII power to amend even further legislation, yet unknown and undiscovered, when the case has been closed off already?

Baroness Pidgeon (LD)My Lords, the Clause 10 stand part notice tabled by the noble Lord, Lord Moylan, raises a point of constitutional principle that the Committee will wish to consider carefully. I draw attention to subsection (6), which enables regulations to be implemented using the negative procedure. Have the Government considered whether the affirmative procedure should apply to all regulations made under this clause, rather than only to those presently specified? Given that the power extends to modifying primary legislation, there is a reasonable case that every exercise of it should require the active approval of both Houses, rather than passing on the nod. Can the Minister confirm whether he is prepared to reflect further on that question before Report?

Lord Hendy of Richmond Hill (Lab)My Lords, the noble Lord, Lord Moylan, opposes the inclusion of Clause 10 in the Bill. I recognise the importance of proper parliamentary scrutiny where powers are taken to make consequential provision, particularly where those powers may be used to amend primary legislation. However, I reassure the noble Lord that this clause is both limited and appropriate. I note that the Delegated Powers and Regulatory Reform Committee did not draw this clause to the attention of your Lordships’ House.

Clause 10 gives the Secretary of State a power to make consequential regulations so that the statute book properly reflects the changes made by the Bill. It is not a power to make substantive policy changes. The clause allows regulations to amend, appeal or revoke provision made by or under an Act passed before this Bill or later in the parliamentary Session, but only when that is consequential on the Bill. Importantly, where regulations made under this power amend or repeal primary legislation, they must be laid before Parliament and approved by both Houses under the affirmative procedure. Such consequential powers are a common and practical feature of legislation used to ensure that the wider statute book works coherently once a Bill is enacted. In this case, the power is appropriately constrained and subject to the necessary parliamentary safeguards. Removing this clause would mean that the Government may need to rely on primary legislation to make minor changes and that, if there were delays, this could create inconsistencies in legislation and legal uncertainty.

I note the suggestion made by the noble Baroness, Lady Pidgeon, to reflect on Clause 6. I will, of course, consider that further. For those reasons, the Government consider it necessary to retain this power, and I hope the noble Lord will withdraw his opposition to Clause 10 standing part of the Bill.

Lord Moylan (Con)My Lords, the fact is that the job has been done. The Minister did not address the point that all the relevant Acts have already been identified and that no further amendments are required. He did not explain—perhaps he cannot explain—what legislation this power should be used for. It is not constrained and, as the noble Baroness, Lady Pidgeon, said, some of its provisions, although not those that allow the alteration of primary legislation, can be processed using the negative procedure. It is not appropriate.

I will conclude very briefly. We started by identifying this Bill as a massive power grab. Our last discussion in Committee is yet more about massive power grabs. This is not the way to treat Parliament. I think many of these issues are going to come back on Report and there will be widespread opposition to the way the Government are conducting themselves. For now, however, I withdraw my opposition to Clause 10.

Clause 10 agreed.

Clause 11 agreed.

Clause 12Commencement

Amendments 124 to 128 not moved.

Clause 12 agreed.

Clause 13 agreed.

Bill reported without amendment.

Committee adjourned at 5.07 pm.