Industry associations respond to 2018 Budget

The UK Chancellor’s announcement that Air Passenger Duty (APD) will increase on long-haul rates and remain frozen for short-haul has been met with disappointment by airport and airline associations, with several seeing it as a “missed opportunity” for the UK.

On Monday 29 October, Chancellor Philip Hammond revealed in his Budget 2018 that from April 2020 APD for long-haul rates will rise in line with inflation, while short-haul rates of APD will remain frozen.

Chief executive of the Airport Operators Association (AOA), Karen Dee, commented: “Last year, the UK was the only country in the EU that saw a decline in direct aviation connectivity. As we prepare to build a Global Britain, aviation connectivity will be vital. The UK currently levies the developed world’s highest departure tax, double the next-highest in the EU, and it is the biggest barrier to growing that connectivity.

“While freeze in short-haul APD is better than the rise for long-haul destinations, the failure to make a decisive cut to APD is a missed opportunity to get the UK Brexit-ready and signal to the world we are open for business.”

Earlier this week at the opening of the AOA’s Annual Conference, Dee called on the Chancellor to cut APD, commenting: “The UK aviation industry is working hard to deliver the services passengers want. But, we’re being hampered in our efforts by the anti-competitive Air Passenger Duty.”

Tim Alderslade, chief executive of Airlines UK, a trade body representing UK-registered airlines, said the announcement “sends entirely the wrong signal as we prepare to leave the European Union.”

He added: “With Brexit just around the corner, it is a missed opportunity to have truly transformed the UK’s international competitiveness.”

Improving the border experience

The Chancellor also revealed plans under the Budget to enable more passengers to use ePassport gates as they arrive in the UK.

Transport associations welcomed the announcement that from summer 2019 travellers from the US, Canada, New Zealand, Australia and Japan will be able to use ePassport gates.

The gates are currently available for British and EU nationals, allowing eligible passengers to be processed quickly.

The government said in a statement that the expansion is expected to “significantly improve the flow of passengers at busy airports such as Heathrow.”

Immigration Minister Caroline Nokes commented: “Increasing the use of digital technology is part of our ambitious programme to improve the passenger experience and meet the challenge of increased passenger numbers.”

The AOA’s Karen Dee said of the announcement: “Extending the use of ePassport gates to citizens of trusted allies is great news for the customer experiences at our international gateways.

“We are pleased to see that Government has listened to the concerns of airlines and airports about the deteriorating border experience in recent years with this announcement. It could be transformational for those airports with high numbers of arrivals from those countries.

“We now urge the Government to work with industry to build on this excellent step forward to work with industry on a long-term plan how to improve the welcome the UK gives at the border and demonstrate that Global Britain is open for business.”

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