South West Economy Risks Losing £843M and 1,569 Jobs as Tax on Flying set for Devolution to Wales
12th February, 2016 - The South West economy is set to lose £843 million and 1,569 jobs if the power to set Air Passenger Duty (APD) is devolved to the Welsh Government, according to figures released today.
Launching its campaign for “A Fair Flight For The South West”, Bristol Airport has published a report highlighting the risks to the South West economy of APD devolution to Wales – something that the Chancellor is likely to announce at this year’s Budget on 16th March.
The risks of APD devolution to Wales include:
- The loss of £843 million in gross value added (GVA) from the West of England economy over the next decade
- The loss of 1,569 jobs in the West of England over the next decade
- The likely loss of almost a third of Bristol Airport’s existing air routes, and long-haul routes expected to be launched soon, reducing choice for passengers from the region, air access for overseas visitors, and trade links for the local economy
- A 25% drop in passengers travelling from Bristol Airport by 2020 – seriously damaging a regional business which generates almost £400m in GVA and supports 11,000 jobs for the regional economy
Dr Liam Fox, local MP, says: “The South West is set to lose out massively if this tax on flying is devolved to Wales. The toxic combination of less consumer choice, job losses and reduced economic activity is simply not acceptable and I am today calling on the Government to halt this measure.”
James Durie Chief Executive of Bristol Chamber of Commerce at Business West, says: “Bristol Airport plays an increasingly important role in the regional economy of the South West. We have the best performing economy outside of London and ambitious plans to grow. A critical part of this is excellent air connectivity to international markets for trade and commerce. Unilateral devolution of this tax to Wales would substantially undermine and damage this. We are supportive of the devolution of power from Westminster but it must be based on terms that will grow UK plc not just transfer activity across boundaries. The Government must properly recognise the economic dangers of unintended consequences for neighbouring regions.”
Robert Sinclair, Chief Executive of Bristol Airport, says: “If this tax is devolved to Wales and scrapped, we will be put at a significant commercial disadvantage to Cardiff Airport, which is owned by the Welsh Government and less than 100km away from Bristol Airport. Even if limited to long-haul flights, there would be a significant impact on more than 100,000 passengers who use European hubs and it would jeopardise plans to launch direct long-haul flights in the near future.
“We expect competition in the aviation industry, but that competition needs to be on a level playing field. Distorting this market will mean less choice and increased costs for people in the South West when going on holiday or doing business overseas.”