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Civil Aviation Appeals

Volume 413: debated on Tuesday 21 October 1980

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4.53 p.m.

My Lords, I hope that it is to your Lordships' convenience that I intervene now, with your Lordships approval, to make a Statement concerning air transport licensing appeals. My right honourable friend the Secretary of State for Trade has just taken decisions on four appeals from airlines against licensing decisions of the Civil Aviation Authority. The first was a request from British Caledonian to give them exclusive licences to operate out of Gatwick to several destinations which they, but not British Airways, already served. In responding to British Caledonian's appeal submission to the Secretary of State, the Civil Aviation Authority accepted that it had acted inconsistently and agreed with the appellant that its own decision should be reversed. British Airways made no representation on the appeal and, accordingly, my right honourable friend has decided to allow it.

The second case concerned British Caledonian's application for 20 routes from Gatwick to the continent—their "miniprix" services. The CAA granted licences for six destinations but felt unable to grant the rest. The airline appealed in respect of five routes. Under the statute my right honourable friend has to pay regard to the likely outcome of the negotiations which would need to take place with the foreign countries concerned. The authority came to their assessment of the likely outcome of the negotiations with the other European Governments, in terms of the anticipated effect on the United Kingdom's aviation interests as a whole. Having carefully considered the evidence, my right honourable friend decided there were no grounds for disagreeing with the authority's assessment.

The third case is Laker Airways' appeal against the CAA's decision on their application for routes to Miami. The CAA granted a licence to operate from Gatwick, but not from Manchester or Prestwick. The bilateral Agreement with the United States allows us to designate two United Kingdom airlines for London-Miami and one each for Prestwick and Manchester to Miami, so there is no need for further international negotiations.

The CAA thought that to allow Laker to fly from Manchester and Prestwick would harm the development of services from London. My right honourable friend considered this point very carefully. He appreciates the authority's reluctance on this score, but does not believe that in this case the overall balance of advantage lies in denying Laker, and his potential passengers, the benefits of operating from Manchester and Prestwick. He also considered that the authority paid insufficient attention to the important airports policy implications; in particular, the advantages of developing services outside the London area. Accordingly, the Secretary of State decided to allow Laker's appeal in this case. My right honourable friend attaches considerable importance to developing regional services and he hopes and expects that the Laker services will benefit the North of England and Scotland.

The fourth case concerns Laker's appeal in respect of 600 or so European routes. The key issues in this case were: whether our domestic licensing system and the series of bilateral agreements with foreign governments are incompatible with the provisions of the Treaty of Rome—rendering the whole of the regulatory machine redundant; and whether the applicant provided sufficient evidence to satisfy the economic requirements of the legislation.

On the first point, Laker argued strongly that the whole system is incompatible with the Treaty of Rome. The Government's legal opinion is that there is no provision of Community law which overrides the regulatory systems of member Governments, though if Sir Freddie wants to test his interpretation of the Treaty of Rome in the European Court he is free to do so. Under the Civil Aviation Act 1971, my right honourable friend also had to examine whether a proper economic assessment has been made for each of the many routes involved. In the light of these considerations, he has decided that he cannot allow the present appeal, but he agreed with the CAA's suggestion that, if Sir Freddie Laker wishes to reapply for those of the European routes which are of particular interest to him, the Authority will consider them with care.

Formal letters giving the Secretary of State's decisions on these four cases are being sent to the Civil Aviation Authority today, with copies to the appellants and the parties to each appeal.

My Lords, that concludes the Statement.

4.57 p.m.

My Lords, may I thank the noble Lord for making that Statement, which records decisions taken by the Secretary of State on four appeals by airlines against decisions of the Civil Aviation Authority. One of those appeals was allowed with the consent of the Civil Aviation Authority, one was allowed against the judgment of the Civil Aviation Authority, and in the other two cases the Secretary of State agreed with the decisions of the Civil Aviation Authority.

The effect of these decisions by the Secretary of State is further to undermine the authority of the Civil Aviation Authority and to strengthen the hands of the noble Lord, Lord Boyd-Carpenter, who I am sorry not to see in his place this afternoon, and my noble friend Lord Beswick, who so eloquently spoke to an amendment to the Civil Aviation Bill last Thursday, seeking to have a proper appeal procedure established, with reconsideration by the Civil Aviation Authority and with the Secretary of State intervening only in really exceptional cases.

As I see it, these are not really exceptional cases. They are cases where it is a matter of professional judgment whether the decision should go one way or the other. The professionals at the Civil Aviation Authority have taken a considered decision and no exceptional reasons should arise to reverse those decisions. There is a danger, if the decisions of the Civil Aviation Authority are overruled like this, that the Civil Aviation Authority will lose authority and airlines will regard the most important part of the application procedure as the appeal, so the whole procedure, as it operates at present, will tend to fall into disrepute. This should not be so. There should not be two bites at the same cherry. No doubt we shall return to this on Thursday during the Report stage of the Civil Aviation Bill.

My Lords, from these Benches I should also like to thank the noble Lord for making this statement. It would be difficult to the point of impossibility to speak intelligently about the decisions of the Secretary of State without having studied the arguments which were placed before the Civil Aviation Authority in the first place and the Secretary of State on appeal.

I have only three rather general comments to make. I agree with the noble Lord, Lord Ponsonby of Shulbrede, that this indicates the undesirability of having an appeal to the Secretary of State instead of having an appeal procedure to a more independent body. But that, as he says, is a matter which can be discussed further when the Civil Aviation Bill comes back to the House on Report.

I was interested to see in the first case that the Secretary of State called attention to some inconsistency in the decisions of the Civil Aviation Authority, with which they agreed. I have been informed—I do not know whether this is right—that the practice has been for the Civil Aviation Authority to share applications, very often with a tribunal of only one member, sometimes two. It occurs to me that the possibility of inconsistency would be reduced if there were always a tribunal of three members so that almost certainly one of them would be able to recall a comparable decision that had been made before, and so tend to avoid these inconsistencies.

My last point is that I was very pleased to see the decision of the Secretary of State in regard to Laker flying from Manchester and Prestwick. I am sure that any effort to spread the load of the overseas services among the other airports is to be commended.

My Lords, I am grateful to the noble Lords for their reception of this statement. I am sorry that it was not all that the noble Lord, Lord Ponsonby of Shulbrede, would have wished. He was particularly critical of what he suggested was the undermining of the authority of the Civil Aviation Authority. I can assure the noble Lord that decisions of the authority are never lightly overturned. However, the appeal system has been set up under the 1971 Act and the subsequent regulations and it is there to be used. There is no point in having an appeals system if appeals are never ever to be granted.

The fact is that any authority can make a mistake. It is also possible for reasonable people to reach different judgments on matters of policy—for example, over the importance of developing regional airports. It is entirely proper, I would suggest, for the Secertary of State, carrying out his quasi-judicial role in these matters when reviewing decisions in response to an appeal, to take a different view from the authority.

In one of these cases—British Caledonian's application for exclusive licences from Gatwick for several destinations—the Civil Aviation Authority themselves admitted that their original decision was inconsistent with some of their earlier decisions and accepted that the appeal should be granted. In another case—aker's routes from Manchester and Prestwick to Miami, to which the noble Viscount, Lord Simon, referred—my right honourable friend took a different view from the Civil Aviation Authority on two issues: first about the preference to be given to operators with services from London to Miami and, second, about the importance of the development of regional airports.

The noble Viscount, Lord Simon, also raised the question of the numbers of Civil Aviation Authority members who hear these original applications. The fact is that under the present law a minimum of one member of the authority is required. We have no evidence to suggest that this is not working satisfactorily. We do not detect any inconsistencies flowing from that particular situation. On the other hand, it is fair to tell the noble Viscount that this is a matter which we are considering. The Commission on Tribunals, I think it is called, has also made some observations upon the position at the Civil Aviation Authority.

My Lords, may I thank the noble Lord for making this Statement this afternoon, especially since he told me on 16th October during the Committee stage that it was unnecessary to make such statements. He turned down my amendment which would have provided for such a statement to be made.

The noble Lord also said to me on 16th October that the Secretary of State would not vary decisions lightly, but I understand from what he has just said that one of the decisions taken was on a balance of advantages. May I ask him whether this is an exceptional case? Would he say that this decision was taken lightly or whether it was taken just on a balance of advantages? When the noble Lord was answering my amendment he also said that only on a few occasions within nine years has the Secretary of State reversed decisions of the Civil Aviation Authority. May I ask him whether, with this batch of reversals, the quota for the next nine years has now been exhausted?

My Lords, I do not think that the noble Lord expects me to answer the slightly flippant last supplementary, if I may so call it. However, I confirm that these matters are considered with the very greatest care, and I will say again, as I said to the noble Lord last week, that decisions of the authority are overturned or varied only after the most exhaustive consideration of all the facts. That indeed was what happened on this occasion. It is still the case that the number of appeals which have been allowed in the nine years or so since the passage of the 1971 Act is very small indeed, and that situation will continue.