Waiving Air Passenger Duty (APD) would save 45 per cent of air
routes out of the UK that would otherwise be lost due to the impacts of the
Covid-19 pandemic, according to a new report written by York Aviation and
commissioned by Airlines UK.
The study found a 12-month APD waiver could potentially save
8,000 aviation jobs and contribute an additional £7 billion in gross value
added (GVA).
According to the report, UK airports initially stand to lose
around 600 routes without government support, though the situation could
improve as the aviation market recovers. However, the country could still be
down 130 routes by July 2021. Around 80 per cent of the routes lost would be from
regional airports.
With government support, Airlines UK said 35 routes could
immediately return, with an APD waiver supporting an additional 56 routes by
July next year.
In addition, the report claims an APD waiver and the savings
it could bring for passengers would boost demand by about 12 per cent over the
next 12 months, equating to 21 million passengers against a baseline of 170
million.
Airlines UK chief executive Tim Alderslade commented: “UK
airports are in danger of losing many valuable routes over the coming months
unless the government steps in with a support package for our sector – starting
with an emergency APD waiver to get us through the winter and into the
recovery. Some of these routes may never come back but APD relief will – by next
July – save almost half that would otherwise be lost. The UK came into this
crisis as the third-best-connected country in the world – it would be a tragedy
if through government inaction and neglect we needlessly forfeited this position
to our closest rivals.”
The organisation has garnered the support of Andrew
Griffith, MP for Arundel and South Downs, and Graham Brady, MP for Altrincham
and Sale West and chairman of the 1922 Committee, who said: “Almost alone within
Europe we have been slow to appreciate the importance of aviation – not only as
an industry that supports a million jobs – but as an enabler of the outward-facing
trading nation we wish to be.”
Karen Dee, CEO of the Airport Operators Association, has
also backed the call for an APD waiver, saying: “We cannot have a full national
economic recovery without a thriving aviation sector; airports are essential
components of Britain’s ambition to be a global trading nation and form a vital
network for economic stimulus across the UK, levelling up the regions. It is
high time that the government supported UK aviation and backed it as the vital
economic enabler that it is and provide the much-needed support to get Britain flying
again.”
Clive Wratten, CEO of the Business Travel Association, said
the organisation has been lobbying for a full or temporary APD waiver to
stimulate business travel demand.
The request will likely be met with opposition from environmental campaigners, who have long argued that reducing the UK’s rate of APD will go against the government’s commitment to achieve net
zero carbon emissions by 2050.
APD has been a bone of contention between the aviation industry and the government for years. Airlines and airports have long lobbied against the rate of tax, which is the highest in Europe, particularly since the UK voted to leave the European Union. Industry groups say the level of tax will prohibit the country from competing with its EU neighbours on the world stage once the UK has fully left the bloc.