Below is the text of the speech made by Nicholas Ridley, the then Secretary of State for Transport, in the House of Commons on 17 June 1985.
I beg to move,
That this House approves the Government’s White Paper on airports policy, Cmnd. 9542.
In proposing an airports policy to the House on 5 June, I had to try to reconcile two interests which conflict. The first is the need to provide the airport capacity that is likely to be needed in each region of the country. The second is the strong views of many thousands of people living near airports about whether further development should take place in their localities. These matters had to be decided. Perhaps the worst policy of all would have been to postpone decisions.
In their 1978 White Paper, the Labour Government foreswore forcing airlines and passengers to go where they did not want to go:
“The Government rejects the suggestion that the air transport industry should be subject to the damaging restrictions on its operations which could be the outcome of the forced diversion of traffic to regional airports.”
I agree with that. But by virtue of our joint rejection of that course, there is no alternative to providing more capacity in south-east England.
However the Labour party may wriggle today, in a position of responsibility it would have had to accept the logic of providing capacity in the south-east for between 72 and 79 million passengers per annum by 1995, just as the inspector did. Economic growth, foreign earnings, and, most important, jobs in the aviation industry are at stake. So is the convenience of both business and holiday travellers.
On the other hand, the Government are acutely conscious of the inconvenience, noise, and development that airports bring to their neighbours. For these reasons we have not sought to provide any more capacity than is necessary, and to phase it so that it is provided only when it is necessary. I will discuss other aspects of environmental protection later in my speech.
I particularly understand and sympathise with the worries of people living near Stansted. They have fought long and hard against a busy airport there. My hon. Friend the Member for Saffron Walden (Mr. Haselhurst) and many other hon. Friends have put their case with consistent force and skill. It is in recognition of this concern that we have restricted expansion at Stansted to the minimum necessary.
We have done our best to meet the concerns of those who really speak for Stansted. The development of the airport will be phased, with the first phase restricted to 7 million to 8 million PPA, an increment of only 5 million to 6 million on Stansted’s current capacity. The growth of traffic will be gradual, the new terminal will open around 1990, but it is impossible to say when it will reach capacity. Gradual growth will make it easier for local authorities to plan supporting development which may be needed, such as housing and services, road improvements, and so on. It will help to guard against the strains imposed by rapid expansion on a relatively small community. Good and sympathetic design of the new terminal and associated developments will be very important, and I am sure that the British Airports Authority and the local planning authority, which will need to approve the detailed plans, will strive for it.
Mr. Bowen Wells (Hertford and Stortford)
Can my right hon. Friend explain exactly how planning approvals will be given, in view of his statement that the expansion will be phased? Is he aware that many of my constituents would accept a phased terminal expansion—say to 4 million to 5 million PPA at the most, which is what is needed at Stansted according to the White Paper, and not between 7 million and 8 million? Is he aware, further, that the British Airports Authority made it clear to me when I visited its headquarters on Friday that it was bent on building a 15-million-PPA terminal. How will that be handled by my right hon. Friend?
My hon. Friend seeks an assurance, which I am happy to give him. The British Airports Authority can apply for a 7 million to 8 million PPA terminal—I think that it is 50,000 sq m in area. It is again controlled by the number of air traffic movements, to which we hope the House will agree to restrict Stansted. If the authority makes detailed application—it has only outline planning permission at present—which is outside that restriction, I would expect the local planning authority to refuse it, and there is always the appeal mechanism if it does not. I assure my hon. Friend that the planning defences are there to make sure that the Government’s phasing of this development is adhered to accurately.
Our proposal to impose a limit on air transport movements at the airport commensurate with the first phase of development will, I hope, provide further reassurance to my hon. Friends and to local residents about the rate of growth of traffic. The legislation, which I intend to introduce at the earliest opportunity, will provide that the limit can be raised only with the approval of Parliament, which will have to be satisfied that this is necessary to meet the demand. This mechanism will ensure direct control by Parliament over the use of the airport. We cannot now be sure of the amount of demand at any time in the future, how much can be accommodated at Heathrow, Gatwick and Luton, and, above all, how successful the regional airports will be, with the Government’s help, in attracting traffic. Parliament will be able to judge all these factors.
Aircraft noise at Stansted is being significantly reduced by bans on the noisier aircraft types, and we shall seek further to reduce the impact at Stansted by improving on the current noise abatement measures, which include restrictions on night operations. There is a review of night sleep disturbance currently under way. Quiet take-off and landing procedures and noise preferential routes will be required. They will be supplemented with new measures, including a noise insulation grants scheme for the Stansted area.
In the light of the decision on phasing the development of the airport, British Rail will be examining the case for a rail link to Stansted. The cheapest option would be a simple spur to the Liverpool Street-Cambridge line, costing perhaps £50 million. The options will be assessed on exactly the same terms as a rail link to Manchester airport. I understand that British Rail thinks that the Stansted study could be completed by the end of this year. The Manchester study could probably be completed sooner than that, I look forward to reading them both.
Mr. Andrew F. Bennett (Denton and Reddish)
The Secretary of State will be aware that some people in the Greater Manchester area are worried that British Rail may be loading the question of the Manchester airport link because of its reluctance to see people changing from train to plane to travel from Manchester to London. Will he make sure that the development of a rail link to Manchester airport is looked at in terms of its international impact rather than simply in terms of its competition with British Rail on journeys from Manchester to London?
I shall seek to make sure of that. It is for British Rail to work out the figures and appraise the nature of the investment, but it is for me to approve it or otherwise. I shall make sure that this work is done properly. It will also be done in conjunction with Manchester city council and Manchester international airport so that they, too, can make sure that there is no suggestion—I am sure that the hon. Gentleman does not suspect that there is any such possibility—of the figures being wrongly put together.
I know there are many people in the Stansted area who oppose any more than a relatively small expansion. But there are also many who welcome the new jobs development will bring. Estimates of the number of jobs arising from expansion of the airport to a capacity of 15 million passengers per annum, both directly and indirectly, vary from 18,000 to 25,000. The inspector appeared to place more reliance on the lower figure; I have no better estimates as yet, but even on this basis it seems likely that development restricted initially to 7 million to 8 million passengers per annum would generate perhaps 10,000 jobs for the unemployed at Harlow, Braintree, Basildon, north-east London and even further afield—for instance, north-east Kent, which now enjoys good road access to the airport. Many people presently commuting to London from the area may obtain airport-related jobs. The more people from neighbouring areas take jobs there, the less will be the pressure for more housing to be provided.
My hon. Friends representing constituencies near Stansted are also concerned that low charges at Stansted might draw traffic away from the regions. This is also a fear shared by hon. Members from the north of England. For this to happen would be contrary to one of our main objectives, which is to encourage the growth of traffic at the regional airports. I assure the House that we will take the necessary steps to ensure that Stansted does not have an unfair advantage.
First, under the legislation I shall be introducing, the structure of the BAA, with seven separate companies under one holding company, will require separate accounts for each subsidiary and full financial transparency; this will inhibit cross-subsidisation. Secondly, the role of the Civil Aviation Authority, in regulating the general level of airport charges, will prevent any predatory price cutting at Stansted. Thirdly, if individual airport companies borrow from within the group or outside it, they will have to pay full commercial rates of interest. The expansion of Stansted will have to be a commercial investment. It follows that charges at the airport will need to rise steeply to meet the costs of expansion. The BAA board, since the decision on 5 June to approve the development of Stansted, has said that it will be consulting its airline customers on the increased charges required to meet the costs of providing the new capacity. The Government are determined to ensure that traffic is not attracted away from the regions by unfair competition.
Mr. Cecil Franks (Barrow and Furness)
My right hon. Friend said that the structure of the British Airports Authority and the seven subsidiary companies would inhibit subsidy. Many Conservative Members would like the word “prohibit” to be substituted for the word “inhibit”, for many people are very sceptical about the good faith of the British Airports Authority.
With respect to my hon. Friend the Member for Barrow and Furness (Mr. Franks), I said that to set up seven separate companies will require separate accounts for each subsidiary and full financial transparency, but that is only part of what I said. I went on to say that we should insist—most probably through the articles of association—upon a commercial rate of interest being charged upon inter-company loans. Furthermore, the Civil Aviation Authority will supervise all charges to ensure that none of them is predatory. That is perhaps the most important measure. Any one of them, taken alone, is not adequate but, taken together, I believe that they will prove to be adequate for the purpose.
Mr. Alfred Morris (Manchester, Wythenshawe)
The Secretary of State is referring to the future. Is he aware that what is happening now is a scandal? Last year, Stansted lost £3·88 million, an average subsidy of £8 per passenger. Its landing charges are one quarter of the landing charges in Manchester. Is the Secretary of State unable to take some action immediately to end that scandal?
If the right hon. Gentleman will support the Bill which is to be placed before the House not only by his vote but by curtailing his speech, the sooner shall we have the power to do what he seeks, but in advance of that legislation I have no such power.
Mr. Robert C. Brown (Newcastle upon Tyne, North)
The Secretary of State has said that he does not wish Stansted to draw traffic away from the regional airports. Will he give a categorical assurance that there will be no hidden subsidies or cross-subsidisation for Stansted?
I have already said this at length twice, so the hon. Gentleman already has my assurance. Our policy is the reverse of Stansted being in a position to attract traffic away from the regions. Its purpose is to help to meet the growth of unavoidable demand in the southeast, not to divert traffic which would otherwise have used the regional airports.
Finally, on Stansted, we have made it clear that no second runway should be built there. I am requiring the British Airports Authority to sell all surplus land that would be needed for a second runway. Its external financing limit will be set on the basis of receiving the proceeds of sale of this land.
Mr. Gerald Howarth (Cannock and Burntwood)
Will my right hon. Friend say how many international airports operate in the 1980s with one runway?
Without notice I am unable to give to my hon. Friend the answer that he seeks, but perhaps he would answer this question: how would our airports policy fare if I were to propose second runways at the three London airports which have only one runway at present?
Mr. Tony Favell
(Stockport): Will my right hon. Friend confirm, first, that the intention of the British Airports Authority is that Stansted should primarily be a charter flight airport? Secondly, how does he intend that the CAA should supervise the charging policy at Stansted? Thirdly, is there anything to prevent Stansted from making losses and also is there anything to ensure that it declares dividends to the holding companies?
I do not confirm that the intention is that Stansted should be a charter airport. The White Paper has asked the CAA to consult all the airlines to establish what would be the right traffic distribution policy. I very much hope that the growth of scheduled services as well as charter flights will take place at Stansted. Secondly, with the information provided by separate company accounting, the CAA will undoubtedly have the power to supervise charges, both to prevent the exploitation of monopoly and to prevent predatory pricing. That is, there will be a limit both at the top and at the bottom. We shall ensure during the passage of the legislation that the powers to be made available are adequate. Thirdly, it is probable that Stansted will make losses in the early years as it develops. It is making losses already. Whether it is a separate company or whether it is part of the BAA, there still has to be the ability for it to make losses. Prestwick is also making losses. We cannot prevent a company from making losses, but we can roll up those losses in the balance sheet of the company so that it has to pay interest on them and finally redeem them when it enters a profitable period.
Mr. Anthony Steen (South Hams)
Does my right hon. Friend agree that if besides privatising it we changed the management structure of the British Airports Authority we might find that no losses would be made? Will he consider changing the management of the BAA as well as privatising it?
I have complete confidence in the management of the BAA, and it is not part of my plans to do as my hon. Friend suggests. We shall have enough on our plate with this legislation.
Mr. Lewis Carter-Jones (Eccles)
Will the right hon. Gentleman give way?
I must make a little more progress.
Perhaps the Secretary of State would give way just on this point.
I shall give way to the hon. Member for Eccles (Mr. Carter-Jones), but after that I shall have to restrict interventions to those who have a constituency interest, otherwise I shall never finish my speech.
I am most grateful to the Secretary of State. I served, as did the Secretary of State, on the Standing Committee on the Civil Aviation Bill, which fell apart and disappeared. He mentioned that there is to be legislation. A White Paper has been published and eventually legislation will be introduced. Will he say in what way that legislation will differ from the Bill that we considered earlier this year?
The contents of the legislation are to be found in the last chapter of the White Paper, which I am sure the hon. Gentleman has studied. The Bill will contain the proposals that were included in the Civil Aviation Bill which the Government abandoned. It will be a wider Bill than the Civil Aviation Bill, but it will include many of the same powers.
On the subject of Heathrow, I must make it clear that we have not simply postponed or fudged the building of terminal 5. I have not ruled out the possibility for all time, but I am not convinced on present forecasts that it is necessary at all. Terminal 4, which is due to open early next year, will handle some 8 million PPA. Thereafter, the major constraint at Heathrow will be runway, not terminal capacity. When the runways reach saturation in the rush hours, growth in passenger throughput at the airport can come only from spreading the traffic to off-peak periods, which is unattractive to both airlines and passengers, or from an increase in the average number of passengers carried on each flight.
During the 1970s, particularly the first half, there were substantial increases in average passenger loads per aircraft at Heathrow, resulting from the introduction of larger aircraft. That growth has slowed down in recent years.
Some have suggested that rapid growth in the average number of passengers per aircraft will be resumed, once runway capacity is reached. But many of the signs point in the opposite direction.
First, it is our policy to increase competition between airlines on domestic routes and to continue pressing for more liberalisation in European markets.
Secondly, commuter routes are growing in importance, with a preference for frequent services and smaller aircraft. Thirdly, we are determined to maintain access to Heathrow for services from regional airports. Fourthly, aircraft manufacturers’ order books suggest that there is now less interest in bigger “stretched” aircraft for long-haul services and, indeed, more airlines are considering operating twin-engined jets across the Atlantic.
The conclusion that I draw is that growth in passengers per flight at Heathrow is likely to be relatively slow, and that it is the runways which will be the constraint. Even if I am wrong, it will be a long time before extra capacity is needed. I ask the House to support the Government’s decision to abandon the 275,000 air traffic movement limit, and to allow us to go back on our undertaking. The Government tried to implement this commitment in the Civil Aviation Bill, but the House did not entirely support us.
Mr. Harry Greenway (Ealing, North)
I appreciate the impossible problem that my right hon. Friend had with that Bill, from the Labour and Liberal parties and from the SDP, as well as from one or two of my hon. Friends. However, any decision to abandon the 275,000 flight limit will be viewed extremely seriously in west London. Will my right hon. Friend go instead for an increased number of passengers on each flight and stick as near as humanly possible to the 275,000 limit? Will he give an undertaking not to increase the number of passenger flights using Northolt?
The market will determine the size of aircraft and the number of passengers carried. On our forecasts, it is unlikely that the number of passengers per aircraft will increase or that there will be a very great increase in the number of flights, as Heathrow is already fairly close to capacity. It would be better to let Heathrow determine how best to use its capacity to the full.
Mr. Robert McCrindle (Brentwood and Ongar)
Should not my right hon. Friend turn his attention to another factor—the type of flying that is likely to become more popular as we move into the 1990s? Do not many in the aviation industry predict a far greater use of scheduled rather than charter flights? If Stansted were developed primarily as a charter airport, might not any future decision about expansion come down quite easily in favour of terminal 5?
I have already said what the Government think about terminal 5. With an ever more competitive and free airline industry, which extends into Europe, the difference between scheduled and charter flights will probably become less and less clear. I do not want to bind any given airport or airline to a particular policy. After all, the operators know best what they want to do and where they want to go. I believe it wise to run traffic distribution policy with the lightest rein possible.
On the subject of the ATM limit, I do not quite understand the point made by the hon. Member for Crewe and Nantwich (Mrs. Dunwoody). On 5 June, she criticised me for abandoning the limit, yet on every occasion her troops voted against a Bill that would have imposed it. I should make it clear that we shall continue with the policy of restricting night flights at Heathrow. Indeed, the studies that I referred to earlier could well alleviate night disturbance there. Quieter aircraft are already beginning to alleviate the nuisance at night, as well as during the day.
Dr. Alan Glyn (Windsor and Maidenhead)
My right hon. Friend has given the impression today that terminal 5 will not be constructed at Heathrow in the foreseeable future. That is in direct conflict with what the White Paper says on page 59. Furthermore, there is a widespread belief that the removal of the sludge works must be a first step towards constructing terminal 5. Will my right hon. Friend give an undertaking that terminal 5 will not be constructed in the foreseeable future?
My hon. Friend has anticipated my comments. If the House will allow me, I shall proceed, as interventions take up too much time.
We attach the utmost importance to airline competition and liberalisation. It has already yielded substantial benefits for the passenger. It is the most effective stimulus of all for extra regional traffic. If the choice is between more passengers using Heathrow and more competition, there is no doubt that the passengers have more to gain from competition. That explains why we may not need terminal 5.
In addition, the development of Luton and Stansted will bring more runway capacity into effective use in the London airport system. It may be possible, as a result, to improve the utilisation of the existing terminals at Heathrow to cater for up to 42 million PPA, thus again reducing the need for a fifth terminal. But I accept that there are uncertainties about the mix of aircraft and the pattern of demand in the longer term, and that a fifth terminal might—I emphasise “might”—one day be needed, although possibly of lower capacity than 15 million PPA. That would not be a realistic option if the Perry Oaks site continues to be occupied by a sludge disposal facility.
The Perry Oaks works were there before the airport began to develop. They are an incongruous neighbour for the airport and I do not doubt that they would be better moved. The land they occupy would in any event provide valuable relief for the cramped Heathrow site. We have therefore asked the BAA and the Thames water authority to study the possibility of moving them, the costs, the alternative sites and methods of disposal, and the time that it would take. When those questions are answered, and we have a clearer view of how traffic will develop, we shall be in a position to assess whether there is a need for more terminal capacity.
On the question of road and rail links to Heathrow, we undertook in the White Paper to examine urgently what could be done to reduce congestion and to improve passenger access to the airport. I intend to appoint consultants to look at options for investment in the corridor between London and Heathrow. The study will cover road access by public and private transport, the Underground, and rail services. The large number of options to be considered inevitably means that this study will take some time. I am also establishing a working group, with the local authorities concerned, to look at options for traffic management in the vicinity of Heathrow.
As I said, all forecasts suggest that we need to provide capacity in the south-east for 72 million to 79 million PPA by 1995. Capacity will run short in the early 1990s. Even if we could provide a fifth terminal at Heathrow after the Perry Oaks sludge works have been moved, that would not solve the problem because it is primarily one of runway capacity. Further provision is needed at airports with spare runway capacity, which means Luton and Stansted.
Looking further ahead, south-east traffic can grow only by use of the five runways we have: two at Heathrow and one each at Gatwick, Luton and Stansted. Our policy is to make the best use of those resources. We have provided for 1995 and allowed room for expansion. We need not commit ourselves before we have to, but equally it would be senseless not to retain the capability to meet the growth in demand, if it happens. I believe that our decisions will provide the scope that our civil aviation industry needs to expand and prosper.
Our decisions have been widely welcomed by the industry, especially the independent airlines operating from regional airports. The airlines know that more capacity is needed at the London airports to provide for the growth of air traffic and the jobs that go with it. Nothing would stifle competition and damage the interests of the travelling public more than a shortage of capacity.
That is why they have welcomed the Government’s decisions.
Mr. Allan Roberts (Bootle) rose—
I shall not give way because I must make progress. I am about to talk about the regions, so perhaps the hon. Gentleman will wait to see whether I cover his point.
Our assumptions for the capacity needed in the southeast include an appreciation of how much traffic can be attracted away from the south-east to regional and Scottish airports. It is a prime aim of our policy to seek to get more traffic to go there, for three reasons. First, it will encourage development and activity in those parts of the country. Secondly, it will serve the interests of passengers there better to fly from local airports. Thirdly, it will relieve the pressure on the south-east. That is why we will look for every possible way of encouraging more flights to regional airports. Our record, as my hon. Friend the Member for Manchester, Withington (Mr. Silvester) said on 5 June, bears witness to our determination. In the last six years we have authorised £200 million of capital investment at regional airports, compared with only £14 million in the last five years of the Labour Government. International scheduled services from Manchester now total 33—of which 14 are new this year. The figures for Birmingham are 15, of which four are new this year.
What regional airports need is more concrete flights, not more concrete. We cannot force airlines to provide unprofitable services, but we can help by pressing for more liberalisation in Europe and by promoting regional airports when we negotiate air service agreements with other countries. No one can gainsay what we have already achieved. We have indeed done far more for regional airports than the Labour Government who preceded us, and who published a White Paper with dismissive comments about
“Limited scope for diverting passengers from the London airports to those in other regions.”
Imagine, therefore, the brazen nature of the Labour party’s amendment today, which states:
“totally fail to foster a modern strategy for the regional airports”.
Since we are the first Government to do that very thing, the hon. Lady’s amendment can be described only as breathtaking.
Mr. Allan Roberts
The Minister has not dealt with the point that I wished to make—and nor has the White Paper. Nowhere is Liverpool airport mentioned—[Interruption.] Hon. Members may groan, but it is important to the people of Merseyside. There is great anxiety on Merseyside that the proposals in the White Paper, coupled with the Bill to abolish the Merseyside county council, will cause Liverpool airport to close. Will the Minister give an undertaking that he will protect Merseyside from that eventuality?
Liverpool airport will belong to the joint board that will be set up after abolition. However, if the districts can agree, it could belong to them in proportion to their shareholding after abolition. The decision of what to do with Liverpool airport will rest entirely with the districts and/or the joint board. I cannot give an assurance that it will or will not close; the decision is theirs, nor mine.
Mr. Churchill (Davyhulme)
May I, as a Manchester Member, say how much I appreciate the fact that since we last debated this matter in February, due to my right hon. Friend’s liberalisation policy there has been a 75 per cent. increase in the number of scheduled destinations to which one can fly from Manchester? It is important to my constituents and to the north-west as a whole, and we thank him for it. We further appreciate his undertaking that landing fees at Stansted will cease to be predatory. How soon is that likely to happen?
I am grateful to my hon. Friend. As I said earlier, the BAA board has already decided to start consultations with airlines about the increase in charges at Stansted that will be necessary. I imagine that those will come in within the reasonably near future.
The Government are committed to the development of Manchester as the major hub gateway international airport for the north of England. British Airways has begun services to New York this summer and will be adding Dubai, Bangkok and Hong Kong from November. But we have also encouraged foreign carriers to operate long-haul services from the airport—Qantas to Australia, El Al to Israel, and Singapore Airlines to the far east. We are also ready to negotiate with the United States Government the basis on which their airlines may operate direct scheduled services to Manchester, and an early date had already been fixed for these negotiations.
American Airlines wishes to begin a Chicago-Manchester service next summer. I hope that the negotiations with the United States Government, which could pave the way for other United States airline services, can be speedily and satisfactorily concluded. Manchester International Airport is being fully consulted about these negotiations. We have established a good working relationship with MIA and are discussing with its management a five-year plan for increasing the range of international services. We have already asked for work to be put in hand to assess the viability of a joint rail link to Manchester airport.
I think that that meets 95 per cent. of the demands of the North of England Regional Consortium—a limited development at Stansted, fair competition on airport charges, and positive policies for developing traffic to and from regional airports. But it has also asked for free access to regional airports for foreign carriers. That particular suggestion is not in its best interests. There are indeed advantages in services by foreign airlines, but a reasonable price must be paid by foreign Governments in return in the form of new rights for United Kingdom airlines or a more liberal agreement between us.
Even the United States, with its liberal policies and competitive aviation industry, insists on a satisfactory quid pro quo for its airlines, and so will we. To give up in advance any advantage we can obtain in negotiations for British aviation interests would be the worst possible deal, particularly for the regions.
The reason for that is simple. More jobs at any airport derive from the services flown by United Kingdom airlines than by foreign-based airlines which centre their operations overseas. The key to the development of regional airports is a strong network of services by British Airlines and the creation of local hubs, locally-based airline support services and local employment. We must strengthen their position, not damage their commercial prospects. The role of foreign airlines is important, but complementary.
These proposals have been welcomed by regional airports. Manchester airport welcomed our White Paper. The chief executive described it on television as:
“Good news for Manchester and good news for job prospects in the North West”.
Even the northern consortium, formed by northern local authorities, stated that the White Paper:
“may form the basis for the kind of development of regional airports which we would have liked to have seen after the 1978 White Paper”.
It called for an assurance that the Government and their successors would honour the White Paper’s commitments. As long as this Government and this party are in office, it has that assurance.
So why did the hon. Lady call the White Paper a
“slap in the face for regional airports”?—[Official Report, 5 June 1985; Vol. 80, c. 312.]
Why did the hon. Member for Burnley (Mr. Pike) describe it as a “kick in the teeth”? Why did the hon. Member for Bradford, West (Mr. Madden) describe it as a “hammer blow” to the regions, or the hon. Member for Denton and Reddish say that most people in Greater Manchester would be “disgusted”? The same day, the Manchester Evening News carried the banner headline, “Boosts for Ringway”. Evidently Opposition Members are not even in touch with opinion in the North.
Just as we seek to encourage more direct services from Manchester to meet the demand in its catchment area, so we seek more direct services from the Scottish airports to meet Scottish demand. We will encourage new long-haul transatlantic services to Scotland, and more direct services to European destinations from Glasgow, Edinburgh and Aberdeen. Glasgow and Edinburgh have done very well in attracting new services; Glasgow now has scheduled services to 10 international destinations, three of them new this year, while Edinburgh serves six European destinations, two of them new this year.
I have recently confirmed the present traffic distribution policy. We now look to the BAA to develop Prestwick as Scotland’s gateway international airport for long-haul services, by exploiting Scotland’s undoubted attractions for tourism and by providing services to assist its important new businesses. Prestwick, as a separate airport company, will probably operate at a loss initially, but I hope that it can be brought into profit very shortly. Our proposals give Prestwick a new opportunity to thrive.
These are our measures aimed at providing additional capacity in the south-east and encouraging more flights from regional and Scottish airports. Time allows me to deal only briefly with our proposals to privatise BAA and convert the major local authority airports into companies. We will have opportunities enough to discuss these proposals during the passage of the legislation.
These policies are complementary to our general aviation policy of encouraging airline competition, leading to an efficient industry providing a cheap and attractive service to consumers. We need to provide the country with an efficient and enterprising airports system responsive to the needs of airlines and their customers. Selling the BAA and imposing company disciplines on local authority airports will, I believe, meet this objective.
It is interesting that, apart from the hon. Member for Crewe and Nantwich, no hon. Member on 5 June questioned the decisions to privatise the BAA and to make the local authority airports into public limited companies. There are arguments we can have about whether the BAA should be privatised in one or two or seven airports. But they will arise in debating the legislation, as I said, and I believe that we have the right answer. I also assure the Liberal party that there will be adequate proposals for regulating these airports and their changes as described in the White Paper, and I say that in view of the amendment which stands in the names of Liberal and SDP Members.
I believe that the policy described in the White Paper will provide the right framework for the expansion of our civil aviation industry, that it will allow enough, but not excessive, airport capacity to be built, and that it will cause the least possible disturbance to those who are adversely affected by airport development. I commend it to the House.