1. The Northern Ireland economy is currently performing well and the number of visitors coming here last year is estimated to have exceeded two million for the first time.[1] Because of its geographical location, good air transport links to other parts of the United Kingdom, to continental Europe and beyond, are vital to the maintenance and development of a healthy Northern Ireland economy.

2. We were conscious, however, when we started this inquiry in early 2004, that air services to and from Northern Ireland had been through a period of decline over the previous decade. During this time ten scheduled airlines ceased operations in Northern Ireland while only three were established and over 50 scheduled air routes disappeared.[2] With only one direct air link remaining to mainland Europe, Northern Ireland was at a considerable disadvantage compared to other regions of the United Kingdom. Our Inquiry also took place at a time of continuing major structural change within the airline industry which has seen increasing pressures on the established carriers and the rapid growth of the so-called low-cost airlines.

3. This report sets out the results of our examination of :

• the development of capacity at existing airports in Northern Ireland
• the specific challenges facing Northern Ireland as a peripheral region of the United Kingdom
• the effectiveness of the Route Development Fund; and
• the potential impact for Northern Ireland of wider air transport issues on the island of Ireland.

4. In the course of the inquiry we visited each of the three commercial airports in Northern Ireland, and we took evidence from a range of organisations in Westminster, Belfast, Aldergrove and Londonderry. We visited Dublin where we had discussions with the management of Dublin Airport and the management of the two principal airlines in the Republic of Ireland. We are grateful to all those who have helped us, including those who provided written or oral evidence. We wish to thank Mr Chris Tarry, our Specialist Adviser, for his valuable assistance.

BACKGROUND

5. Northern Ireland has three commercial airports. The largest of these, Belfast International Airport, which is privately owned, handled some 4.4 million passengers in 2004, principally using low-cost or charter airlines. It is situated in a sparsely populated area, has no constraints on overall capacity or operating hours, and has scope to expand within its existing boundaries.

6. Belfast City Airport, which is also privately owned, provides a wide range of scheduled services mainly to destinations within the UK and handled just over 2 million passengers in 2004. Because of its location close to Belfast city centre it is subject to constraints and has to operate within a planning agreement which restricts its operating hours and overall capacity. It is also one of a small number of airports designated by the European Commission as a 'City Airport' which means that it may be subject to "more stringent noise-related operating restrictions than at other airports in the EU, if desired".[3]

7. City of Derry Airport is owned by Derry City Council and operates a limited number of services, serving the northwest area including Co Donegal in the Republic of Ireland and handling just under 0.25 million passengers in 2004.

8. The Department for Transport (DfT) is responsible for overall aviation policy throughout the United Kingdom. Within Northern Ireland, the Department for Regional Development (DRD) has responsibility for a number of aviation matters including land use planning, environmental issues such as noise control, surface transport and the funding of airports in public ownership. The Department of Enterprise Trade and Investment (DETI) provides funding for a Route Development Fund that aims to promote new air routes of economic benefit to Northern Ireland. The Department of the Environment (DOE) has responsibility for decisions on planning issues relating to airports.

9. The Government published a White Paper in December 2003, which set out a strategic framework for the development of airport capacity in the United Kingdom over the next 30 years.[4] The White Paper recognised the need to balance the benefits of expansion of air travel against its environmental impact including "the significant impact that airports can have on those living nearby".[5] The principal conclusions in the White Paper in relation to Northern Ireland airports were that:

• "the Northern Ireland authorities should review the form of the planning agreement at Belfast City should the airport operator ask them to do so;
• the scope to develop capacity within Belfast International's existing boundaries is significant and should be supported;
• the future development of City of Derry Airport needs early consideration in conjunction with the Government of the Republic of Ireland;
• all developments will need careful environmental assessment."[6]

10. Those who made submissions to us generally accepted the overall thrust of the White Paper, although there were differing views on the solution to the problem of shortage of runway capacity in the South-east of England which has a bearing on the forecast growth for other regions of the UK, including Northern Ireland. The increasing pressure on capacity in London and the South-east will have significant implications for regional services throughout the United Kingdom and for Northern Ireland in particular because of its high dependence on Heathrow for onward global connections. London Redhill Airport argued that the White Paper's conclusions on runway capacity in the Southeast was "too little, too late and partly in the wrong location"[7] while bmi (formerly British Midland) believed that the White Paper "establishes a sound strategic framework in which that capacity can be delivered in a sustainable way".[8]

11. Within Northern Ireland only the management of Belfast International Airport was overtly critical of the White Paper stating that it "fell short of expectation and … gave no firm direction for the future".[9] Its main concern appeared to relate to the growth forecast for the Belfast City Airport in the White Paper.[10] The General Consumer Council called for the Department for Regional Development "to consult further to promote informed debate and devise a strategy on how Northern Ireland airports can facilitate the proposed growth over the next 25-30 years".[11] Whilst the Department for Transport told us that its "view on aviation policy affecting Northern Ireland has not changed materially since publication of the White Paper", it drew our attention to the fact that ^"the Government is committed to reviewing implementation of the White Paper in 2006."[12]

12. A Transport Committee report on aviation, prepared in advance of the White Paper, warned that none of the White Paper's "goals will be achieved unless the Government immediately takes action to plan and monitor and ensure the delivery of the developments and policies it proposes."[13]

2   Ev 103; Ev 123; Q 375 Back

3   The Future of Air Transport, Department for Transport, December 2003, Cm 6046 Chapter 7.8 Back

4   The Future of Air Transport, Department for Transport, December 2003, Cm 6046 Back

5   Ibid, Executive Summary Back

6   Ev 111 Back

7   Ev 162 Back

8   Ev 169 Back

9   Ev 122 Back

10   Q 374 Back

11   Ev 36 Back

12   Ev 111 Back

13   Select Committee on Transport, 2002-03, Sixth Report, Aviation, HC 454-I, para 265 Back