In our previous articles we’ve referenced the work of the New Economics Foundation. This is an independent charity which strives to transform the UK economy so that it works for people and the planet, rather than wealthy shareholders and company management structures.
One of their latest reports looks in depth at Aviation, and the economics of Air Transport in the UK. They’ve looked at four of the key reasons Airport Operators’ reference to their cases that expansion is crucial:-
- The welfare impact of broad access to international travel, and the social benefits this brings to UK residents.
- Job creation, both locally and nationally.
- International Air Transport growth does not affect the UK tourism industry.
- Air Transport growth is beneficial for the wider UK economy and Gross Domestic Product.
The full report can be found here:- https://neweconomics.org/uploads/files/NEF_Losing-altitude.pdf
The New Economics Foundation recommendations are:-
- The Government should conduct a new, comprehensive, call for evidence and review of the economic case for the expansion of the UK Air Transport sector in terms of passenger departure and air traffic capacity.
- In light of the findings of this review, the Government should consider the consistency of its air capacity policies with those of climate change, domestic tourism, and its Levelling-Up Agenda.
- Given the proven and significant environmental damage delivered by Air Travel, set against uncertain and declining economic benefits, it might be prudent to pause airport expansion proceedings until said review has been completed.
- Economic impact analysis capacity at different layers of Government decision-making should be improved. Delegated decision-makers, such as the Planning Inspectorate and Local Authorities tasked with appraising large and complex Air Transport proposals, should have greater access to economic training and independent technical support. This capacity would assist decision-makers in navigating several often misrepresented, opaque and/or ignored issues surrounding Air Transport appraisal, including: –
- Ensuring comprehensive inclusion of all socioeconomic costs and benefits in economic impact assessments of Air Transport proposals, and application of welfare weighting to account for the equity of impacts (in line with the Government’s Green Book). –
- Scrutinising claims made around growth in business passenger departures and resulting productivity gains.
- Estimating and quantifying greenhouse gas emissions impacts in economic welfare impact assessments, according to Government guidance.
- Ensuring routine measurement of the impact of proposed Air Transport growth on the flows and balances of tourism spending.
- Delivering consistent assessment of the displacement of impacts between sectors and regions and the presence of national-level impacts.
- Providing an expert opinion on the currency, relevance, and credibility of data cited on Air Transport’s economic benefits.