DERBYSHIRE and Nottinghamshire Chamber of Commerce has called on the Government to create additional capacity at UK airports, including East Midlands, and scrap the proposed increase in Air Passenger Duty.
The Chamber has made the comments following the publication of a new report by the British Chambers of Commerce. It contains evidence from an express freight survey, which found that around 10% of firms would relocate from their strategic location close to the East Midlands Airport freight hub, and potentially from the UK, if international next day delivery services were no longer available.
The report sets out recommendations to develop a long-term aviation policy which supports business growth and job creation. It demonstrates that the current lack of a clear aviation policy means the UK could miss out on millions in GDP, and much-needed jobs.
Aviation allows businesses to deliver high-value goods, move employees, and link to new markets. Around 40% of the UK’s exports go by air and good connectivity is vital to attracting inward investment, and driving growth in tourism.
If businesses are to deliver sustained economic growth, then the UK needs a long-term plan to improve the UK’s aviation infrastructure.
The report also recommends the scrapping of planned increases in Air Passenger Duty as a priority for the Government. In the UK, APD has increased between 140% and 320% since 2007, with a further increase of 5% expected in April 2012. Many European countries, including Belgium, Holland, and Denmark, have abandoned aviation taxes due to the negative effect on their economies.
Analysis in the report shows that a 5% year-on-year rise in APD could cost the economy at least £70m by 2015, £190m by 2020 and £660m by 2030; and reduce the number of jobs by as much as 25,000 by 2015, 71,000 by 2020 and 250,000 by 2030.
Commenting on the report, George Cowcher, Chief Executive of the Derbyshire and Nottinghamshire Chamber of Commerce, said: “What this report makes clear is that the UK needs a long-term aviation policy with economic growth and job creation at its core.
“East Midlands Airport is an important freight hub for the UK. If this Government is serious about rebalancing the UK economy and promoting growth across all regions, it should incentivise the growth of regional airports through discounted taxation and initiatives to help increase its capacity by boosting investment in its infrastructure.”
Brian Conway, Head of Government and Industry Affairs at East Midlands Airport, added: “The Government needs to support the aviation sector, not kill it. It says it is supportive, but the lack of a clearly-defined strategy and high taxation is making airlines choose to expand elsewhere in Europe and not in the UK.”