CONCLUSIONS

72. NATS has failed to meet every target it has set for the opening of the Swanwick centre, and still cannot give a firm assurance about an opening date. It seems that either the original specifications for the system at Swanwick were wrong or that changes to the specifications have hindered it being brought into operation. We find it remarkable that the previous management of NATS decided to press on with pioneering this highly complex project after the US Federal Aviation Administration abandoned a similar system. The previous CAA and NATS management must take the blame. We are also astonished at the apparent complacency of the Department about progress with the project in recent years. Either the Department of Transport did not detect the early warning signs of a major problem, or it did not act on them.

73. The delays to Swanwick have meant that the London Area and Terminal Control Centre is having to cope with the constant increase in traffic, and air traffic controllers and the equipment they use are under severe pressure. We have heard contradictory evidence about whether the increase in traffic is reducing the safety of the system, and there is a shortage of consistent and comprehensive performance indicators of air traffic control management and operations.

74. In order to avoid the problems caused by the delays to the Swanwick project persisting for several years more, there is an urgent need for the Department of the Environment, Transport and the Regions to commission an independent audit to run in parallel with existing work, which should have a short and definite time limit, to establish answers to the following important questions:

• Whether the increasing demands on the personnel and equipment at LATCC are such that there is an increased risk of an accident
• Whether the software at Swanwick can be made to work or whether a simpler system should be used instead. Depending on the results of this study, a decision must be made as to whether the Swanwick software system should be abandoned
• Whether NATS has underestimated future traffic and therefore the air traffic control capacity that will be needed
• Whether dissimilar software systems should be used at Swanwick and at the New Scottish Centre.

75. In addition, the National Audit Office should in the near future examine in detail the costs of the New En Route Centre and the extra cost of the delays to the Swanwick project; why almost all the fee to the software contractor has been paid before the system has been shown to be capable of working; the placing of the contract for the New Scottish Centre; and the implications, financial and otherwise, for NATS of having a single supplier of air traffic control systems. When the Swanwick centre is operational, the National Audit Office should study the history of the project in order to learn and disseminate the lessons.

76. The contract for the New Scottish Centre must not be signed unless the independent audit of the software system which we have recommended shows that the software at NERC is capable of working properly.

77. NATS will need significant capital investment in the near future. We doubt whether it can expect to receive any more money direct from government funds to finance this. In addition, the evidence suggests that there are serious problems about using the Private Finance Initiative as a mechanism for funding air traffic control investment where a unified system is of critical importance for safety, and that the PFI is a relatively expensive way of financing investment. Since the Eurocontrol charging structure ensures that NATS recovers its costs, we believe that the private sector would be likely to be willing to lend NATS money for capital investment. We have reservations about the privatisation as a profit-making company of such an important national organisation with vital defence implications. Other countries have solved this dilemma in a number of different ways. Their common feature has been to provide the air traffic control service with the ability to raise capital outside government spending limitations, and allow it more management freedom, while not turning it into a profit-making private sector company. The Government should examine the experience of other countries in restructuring their air traffic control organisations with a view to adopting one of these models or adapting one of them to UK conditions.

78. The evidence has in our opinion identified profound issues regarding the role of the CAA's Safety Regulation Group and the activities of the CAA in this and other important areas of responsibility. We are likely to return to this subject in the future.

79. In accordance with good practice and in order to prevent any possible conflict of interest between safety regulation and operational responsibility, the CAA's Safety Regulation Group should be quite separate from NATS. In order to achieve this, the Safety Regulation Group should be moved to a new independent transport safety authority and NATS should be separated entirely from the CAA. Any new transport safety body should include representatives of operators, consumers, and of those who work in the aviation industry.