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Passenger numbers to more than double ?
The Regional Air Studies and the resulting White Paper are based entirely
on a prediction by the government that the number of
passengers using the UK airports will more than double in 20 years - from 180 million a year in 2000
to 500 million a year in 2030.
Where will that growth come from ?
The growth will come mainly from leisure trips. Leisure trips are becoming shorter and shorter with more people flying off
for more weekend breaks.
Do we need these trips ?
The essential fact to remember is that the forecast growth in air travel of the next 20 or 30 years in the
UK will be largely accounted for by these inessential trips. Is it really in the best interest of the
country that our inhabitants' health, quality of life and environment should be sacrificed so that more
better-off people can fly to Prague for the weekend ?
Key facts to note
- Only 20% of flights are for business purposes. That figure is likely to remain constant over the
next 20 years. If it were not for the leisure trips, there would be little need for an increase in airport capacity.
- £8.6 billion annual deficit in aviation tourism. That is the difference between the amount of money spent
abroad by Britons flying out of the UK for leisure and holiday trips (£17.7 billion) and the amount visitors to
the UK spend here (£9.1 billion). See aviation and tourism briefing.
- Tax concessions are stimulating the demand. Air fares are so low because of the huge hidden subsidies
received by the aviation industry. It pays no tax on aviation fuel, no VAT on the purchase of planes or any of
the components of air travel, nor does it cover the costs of the noise and pollution it causes.
See aviation and tax briefing.
- Removing subsidies to aviation would benefit low-income households. Most people on low-incomes do not fly off
on weekends abroad. They make few air journeys. They therefore receive the least benefits from the subsidised
fares. See aviation and equity briefing.
- Subsidies are socially divisive. Everybody would benefit if the subsidies to the aviation industry
were cut. The Exchequer would get a big increase in tax revenue, which would help fund public services without
needing to increase income tax. See aviation and equity briefing.
- Regional Aviation Studies assume that these subsidies will remain. Despite the evident
costs to society of these subsidies, the government is assuming that they will remain. As a result, they
forecast that fares will decrease by 1% or even 2% per year (in real terms), fuelling unsustainable growth
rates. See aviation and tax briefing.
- Subsidies distort the UK economy. The total annual subsidy to the industry is estimated to be in the
region of £7 billion. This disorts the economy and leads to a loss in welfare. See aviation and tax briefing. The
aviation industry would continue to provide jobs without the subsidies and overall employment would be
unchanged. See aviation and jobs briefing.
- Airport expansion won't help regional economies. Independent evidence suggests that new transport
infrastructure - of any sort - plays a very limited role in regional regeneration. Only if all the other conditions
are right, such as the availability of labour with the necessary skills, are new or expanded airports likely
to significantly assist regional regeneration. See aviation and regeneration briefing.
Links to other pages on economics and the air studies
economics introduction
tax avoidance
tourism
regeneration
equity
jobs
red herrings
Links to related pages
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