Mark Lazarowicz: Edinburgh North & Leith

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	The Aviation Industry and the Environment
	Mr. Mark Lazarowicz (Edinburgh, North and Leith): I, too, congratulate my hon. Friend the Member for Putney (Mr. Colman) on securing a debate on this matter. He made reference to the true cost of aviation, which is the nub of the debate on how to find a way in which the aviation industry can pay the true costs of its impact on the wider community and on the environment. An imaginative and comprehensive approach must be taken to the problem, because the aviation industry enjoys tax concessions amounting to about £10 billion a year. Setting against that the £900 million raised from air passenger duty brings it down to just over £9 billion—comprising such things as VAT exemptions on tickets and aircraft fuel, exemption from excise duty on fuel, and other tax concessions. That is relevant to the debate about airport capacity, because if one links a low-tax framework to the increased capacity that the White Paper foreshadows, air travel prices will continue to reduce in real terms, leading to increased demand, so demand for more capacity will also continue to increase. The right tax policies are essential if the right sustainable aviation strategy is to be advanced. If the tax concessions to which I have referred were to be removed gradually, over 25 to 30 years, air travel would not increase in real terms but it would keep pace with inflation. The way in which those tax concessions should be addressed cannot be restricted to this country. The issue has both European and international dimensions. We should not expect too much from some of the international aviation bodies that are dominated by airline industry interests, but we can look to the European Union to take a major role in addressing the issue. The idea of an emissions trading scheme for air travel is gaining support in many quarters. That could certainly be introduced on a European Union basis, and it would have an impact on some of the scenarios outlined by my hon. Friend the Member for Putney. It has been suggested that an emissions charge introduced on an European Union basis would reduce aviation's carbon dioxide contribution to global warming by up to 13 per cent. That would clearly have a significant effect on the overall picture. Such an emissions trading scheme might also allow us to move away from air passenger duty, which is a blunt instrument and takes little account of a journey's environmental consequences, which depend on its length, and the type and size of aircraft. Emissions trading would allow a much more comprehensive approach. Finally, alongside a taxation policy to ensure that aviation bears its true costs, there should be investment in high-speed rail capacity, as my hon. Friend said. Such investment would allow many journeys in the UK to be transferred from air to rail, and would benefit areas such as mine very much. Auctions for slots at airports, for example, might allow funds to be raised to develop rail lines over the next 10 years, and not only contribute to solving the problem, but improve transport links to areas with the greatest need for urgent improvement.

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	18th November 2003, Column 233-4 Westminster Hall