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UK Government blocks devolution of Air Passenger Duty to Wales

Cardiff Airport statement: UK Government’s decision to block the devolution of Air Passenger Duty (APD) to Wales
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Deb Bowen Rees, CEO of Cardiff Airport, said: “We are hugely disappointed by today’s announcement.
“Cardiff Airport has always been in favour of the UK-wide abolition of Air Passenger Duty and in support of the ‘A Fair Tax on Flying’ campaign. It is a punitive tax on travel and a cost that hinders the ability for the United Kingdom to remain competitive in what is a very competitive, fast-paced global industry. Not to mention, the UK APD rate is one of the highest in the world.

“We presented compelling and robust evidence to the Welsh Affairs Committee to demonstrate how beneficial this would be to both Wales and the South West as a region. The WAC then went on to make their own impartial, confident recommendation to the UK Government that demonstrated complete, cross-party support for the devolution of Air Passenger Duty to Wales.

“It is difficult to understand the timing and the reasoning behind today’s decision. This would have been a real post-Brexit boost to the region, enhancing international connectivity and promoting competitiveness within the industry. Furthermore, it would lead to environmental benefits, enabling customers to fly locally and, in turn, drive significant economic benefit to Wales and the South West of England.”
 
I've never been a fan of the idea of devolving Air Passenger Duty, not that I've ever been a fan of the tax in the first place. I just think it will have too much of an impact on neighbouring regional airports such as Birmingham and Bristol airports and so long as we are part of a United Kingdom I think it's not fair to disadvantage one region in favour of another. Other ways of encouraging growth in Wales should be explored to maximise the potential of Cardiff airport and to maximise inward investment. On a final note, I think as long as we are peddling the global warming agenda we are unlikely to see any relaxation in the APD tax and if anything it's likely to get more expensive in years to come unless the climate change narrative changes.
 

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The problem is that the UK government has already devolved it to Scotland and long haul to Northern Ireland and i believe they were investigating whether to devolve short haul to Northern Ireland as well. It's been recommended now twice that it be devolved to Wales yet the UK government has refused. The Welsh government has always stated that it will hold an enquiry and factor in any environmental factors but they want the decision to be thiers and not someone from London. For Cardiff to continue to grow it needs the playing field levelled a bit to be more attractive to airlines like Ryanair not for just routes like Alicante but for routes like Milan or Rome or Madrid. Bristol will always be the dominant airport in the area and APD won't change that, in fact i actually wonder if it would help Bristol as more routes from Cardiff may well encourage more people to fly in and out of the region altogether. Wales as a country needs to be able to have better connectivity with the world, the only other way to do that is with massive subsidies which will immediately get reported by Bristol to the EU. In Wales we are constantly told that Wales is part of a union of equals yet things like APD are denied to us which make it very clear that Wales is only there to serve England. I used to be an a die hard unionist but i would now vote for Welsh independence tomorrow if i could because i think APD serves as an example of how the UK won't act in the best interests of Wales and i'm not alone in feeling this. I do think that the Welsh government would've excepted long haul but the UK government didn't even bother devolving that, they didn't even bother launching their own investigation just excepted the findings of the report commisioned by Bristol Airport.
It's frustrating from the view of someone who wants Cardiff airport to do well because i think it and many other regional airports are having both hands tied behind their backs.
 
I think the problems you mention are prevalent throughout many UK regions with regions suffering largely at the expense of London. We see huge divides from town to town, and from city to city. I know you are a well travelled guy and I think you will probably understand when mentioning the differences between Leeds and Manchester. Leeds has a small under developed airport that struggles to compete with neighbouring Manchester airport. The latter is undergoing a billion pound transformation project as you will be aware. The cities are the same, Leeds struggles to get any government investment for things such as transport infrastructure whereas neighbouring Manchester ploughs millions into Metrolink, it's rapid transport system.

I understand why you might feel frustrated about this especially when Wales is meant to be devolved with it's own powers but unlike the Scottish airports, Wales' Cardiff is very close to Bristol and it would be a huge disadvantage to Bristol airport and the wider Southwest region. You mention wanting a level playing field? Is giving Cardiff airport a significant edge over neighbouring Bristol airport really a fair thing to do? Personally I think the problems which lead to the Brexit debacle were more to do with the inequality and poor distribution of UK wealth than with the EU. We've got ourselves into a right old mess. If Wales and the wider Southwest region had received sufficient funding to start with would the devolving APD question have been asked in the first place?
 
You mention wanting a level playing field? Is giving Cardiff airport a significant edge over neighbouring Bristol airport really a fair thing to do?
Except is it an advantage? Bristols passenger numbers are coming up to the 9 million passengers mark while Cardiff is 1.6 million and will probably drop to below 1.5 million passengers.
Bristol will always be the dominant airport and will continue to grow as it has done over the last few years while Cardiff has recovered as well. The playing field won't be levelled with Bristol it never will be but it might be less steeper.APD will never stop Bristol being an attractive airport for people from southern Wales to fly from.
There also the political side. Wales is a country yet it's not allowed to adjust its own APD because essentially its neighbour says no because saying no benefits it. Could you imagine the outcry in England if say the Welsh government prevented the UK government from doing the opposite?
 
One thing with the whole narrative of APD is that the UK government always focuses on how it will impact English airports but not benefit Wales and that Cardiff is just in competition with Bristol but Ryanair did state that Cardiff main competition for routes comes from airports all over Europe most of which don't have something like APD to hold them back and from my own personal experience having the ability to fly from Cardiff hasn't just benefited Cardiff but Bristol and Heathrow and Manchester as I've used all of them in my travels not just for the YouTube channel but for personal reasons as well so it quite possible a more vibrant Cardiff airport may benefit Bristol as well.
 
Whilst it's disappointing to see Wales not getting APD devolved, you have to look at the bigger picture. Wales is a part of the UK but for Scotland and Northern Ireland it's also about Geography. Northern Ireland is competing with Southern Ireland which isn't part of the UK. Scotland has a number of Airports, with the only competition really being NCL, but even then I can't see many people from Northern England choosing Scottish Airports over NCL, and also the catchment is different in that NCL is able to support it's own route network.
We can say "but it's not fair.....etc etc", but in reality, regardless of how well BRS is performing, it's still competing private businesses. It's like handing subsidies to small local grocery stores in order to compete with the big supermarkets, it rarely happens, if at all. The smaller businesses need to find ways to compete. Or in another way it's like handing money to the likes of Flybe/BMI regional etc in order to compete with EZY/FR. It won't happen.
CWL was doing just fine in 2008/2009 on it's own, but was run down due to it's then owners not investing in it. That isn't the fault of the Government or BRS. It's up to CWL and it's owner to get it out of that mess.
I can't see how devolving APD to Wales would benefit BRS. Despite what people think, devolving APD it's going to bring a raft of new routes to Wales. If anything it will just mean increased frequencies on current routes and the introduction of certain sustainable routes that are highly likely already offered from BRS. If people want to fly in to the region, they have the option of using BRS. So I can't see how it's going to create any fantastic new opportunities to accessing the area.
In Wales we are constantly told that Wales is part of a union of equals yet things like APD are denied to us which make it very clear that Wales is only there to serve England.
Surely if Wales is part of a union of equals, then everything needs to be equal? As in APD for all of those in the union. If APD is devolved then Wales it's at an advantage, so not equal measures?

Ultimately it's about saving money to make routes more attractive. It's often said that devolving APD won't actually decrease air fares, as Airlines will pocket the money to make the routes more sustainable. So if the air fares being offered are the same to BRS as they are to CWL, then it's only serving the Welsh catchment. Is the Welsh catchment and inbound business and tourism demand big enough to support many new routes?
Maybe the Welsh government should look at other options, which again may or may not be given the go ahead. Spanish residents get discounts on flights internally in Spain. Could the government fund a similar system to people from to/from Wales?
Could Welsh residents get discounts on parking/bus/train fares? Could inbound tourists/business travellers claim back some of the cost?

CWL needs to show that it is an extremely cost efficient operation with the lowest costs possible to be able to offer deals to Airlines to get through the door before it starts doing anything to try and get advantageous deals elsewhere. It needs to play on it's positives and shout from the rooftops about what it's got to offer, which I personally feel doesn't happen enough. It's small, easy to transit through, closer to peoples homes to other Airports (excluding South East Wales) and can actually be quite competitive on price. Not enough is being done to dispell the myths about the prices Airlines charge from CWL. Many people still spout the landing charges being high myth.... STILL!

Lastly, if APD is devolved to CWL to enable it to better compete with BRS, then it should also be devolved to EXT and NQY. LBA & LPL should get it to compete with MAN. DSA and EMA to compete with BHX. SOU & BOH to compete with LHR/LGW. It's all the same situation. For such a small Island, the UK has a lot of Airports, mainly through historic building of Airfields during the war, realistically, are they all needed?
 
Surely if Wales is part of a union of equals, then everything needs to be equal? As in APD for all of those in the union. If APD is devolved then Wales it's at an advantage, so not equal measures?
Except that Wales is the only part of the UK that doesn't have the power to adjust APD so it's not equal.
Lastly, if APD is devolved to CWL to enable it to better compete with BRS, then it should also be devolved to EXT and NQY. LBA & LPL should get it to compete with MAN. DSA and EMA to compete with BHX. SOU & BOH to compete with LHR/LGW. It's all the same situation. For such a small Island, the UK has a lot of Airports, mainly through historic building of Airfields during the war, realistically, are they all needed?
I do agree there. I think that airports below a certain passenger numbers should get some sort of reduced APD.
With Wales for me it's down to self determination. Decisions effecting Wales should be made in Wales by a Welsh government not London.
As for CWL APD needs to be part of a package to attract airlines. It won't ever be the be all and end all but you can shout out about how good and convenient CWL is and how cheap but unless the airlines turn up and operate and make money from Cardiff then people will continue to say things like the landing fees are still high and that Bristol and Birmingham are superior to Cardiff whether it's true or not.
 
It's an interesting idea, having APD tax brackets, kind of like income tax brackets, but they would also cause similar issues. For example, a person on a £35,000 salary can actually end up with more in the bank at the end of the day than someone on a £40,000 salary, because the latter is in a higher income tax bracket and gets more taken off them in tax. I know someone who declined a pay rise because of this very issue.

Now applying this to the way airlines do business. I think this could actually cause a few setbacks for smaller airports. There might be growth from airlines while the airport is in a lower tax bracket, but more marginal routes could start running at a loss if the airport grows enough to move into a higher tax bracket.

It might also deter based airlines from adding more flights if an airport's pax numbers are hovering just beneath a higher tax bracket, since breaking the pax barrier will make their operations at that airport less profitable as a whole.
 
As for CWL APD needs to be part of a package to attract airlines. It won't ever be the be all and end all but you can shout out about how good and convenient CWL is and how cheap but unless the airlines turn up and operate and make money from Cardiff then people will continue to say things like the landing fees are still high and that Bristol and Birmingham are superior to Cardiff whether it's true or not.
It's simple marketing, which if any business doesn't do, it will fall behind. Any business that is falling short often rebrands, relaunches or find ways to create interest in it again and change opinion. That in turn will increase demand, which in turn should increase supply, that's how business works.
The BBC news just reported on this and quoted 20% of BRS's passengers coming from South Wales, so approx 1.75 million, more than actually travel from CWL. That should be the concentration. Reduce APD as much as you like, but if the Airlines take the money and don't reduce the air fares, why would people choose to use CWL when they are already using BRS for routes that are also already flown from CWL? If that demand and way of thinking by passengers doesn't change, then you've got a bunch of Airlines pocketing the money from reduced APD and hardly any guaranteed benefit or increase from the Airlines.
I can't remember the last time i saw or heard an advert about Vuelings services. Flybe also seems to have seen a marketing reduction. 2 probably lesser known Airlines to FR and EZY that people seem to default to. Now we're seeing Vueling become stagnant and demand on certain flybe routes not being strong enough to retain them and the base. (within Q400 range). EZY and FR with much lower cost bases can afford to knock a tenner off their fares at BRS and continue with their brand power to attract Welsh travellers. Although it may influence many, £13 reduction per ticket isn't a deal breaker, especially for groups of travellers over family travellers, as a group (like a stag/hen party) would only see an individual saving of £13 each, whereas a family would look at it in a different way, as in a family of 4 would save £52.
 
It's simple marketing, which if any business doesn't do, it will fall behind. Any business that is falling short often rebrands, relaunches or find ways to create interest in it again and change opinion. That in turn will increase demand, which in turn should increase supply, that's how business works.
And most businesses will have a limited marketing budget and I personally believe a big chunk of CWLs is tied up with promoting Qatar Airways rather than other airlines.

The BBC news just reported on this and quoted 20% of BRS's passengers coming from South Wales, so approx 1.75 million, more than actually travel from CWL. That should be the concentration.
But why are those people and I'm one of them, attracted to Bristol. It's because they have the airlines and routes namely Easyjet and Ryanair. On Wednesday I'm flying from Bristol not because it's cheaper but because I was attracted by the Ryanair brand. It'll be a cold day in hell before Easyjet flies from Cardiff but Ryanair are a different matter. So how does Cardiff persuade Ryanair to not just offer a few weekly flights but offer dozens of weekly flights not just to sun destinations but from European cities bringing in tourism into Wales and giving Wales more exposure around Europe? APD is a way of doing that or the Welsh government doing s marketing deal. But without something like those then Cardiff becomes far less attractive to an airline like Ryanair.
 
I agree with Jerry, the people of WALES will see this as yet another let down by Westminster, so far this year Wales have seen the new nuclear power station on Anglesey mothballed, the Swansea Bay Tidal lagoon turned down, the non electrification of the main line between Cardiff and Swansea, and this in a country which allegedly is autonomous, no wonder people are turning to nationalism.
 
The UK government decision to block APD will only help to contribute to what happened in Merthyr today when over 5000 people turned up to march in support of Welsh independence. The Welsh independence movement is now more organised and growing and more high profile than before.
 
We've discussed many times the iniquitous quasi federal system of government we have in the UK with three of the four countries having some form of devolved government - but not the same in each - and the fourth having none.

If, as would seem possible, a different Westminster government evolves in the coming months they might take another look at APD devolution.

If it were to be significantly Lib-Dem/Green in colour, even if as the support group for Labour, that would throw up an interesting conundrum as lower APD would likely lead to more flights which would be anathema to the Lib Dems and Greens because of perceived climate change reasons.

If a Labour-led coalition also had to rely on the Scots Nats and Plaid Cymru for support in order to govern more interesting questions would arise as these two parties would doubtless name their price: another independence referendum for Scotland and possibly APD devolution as part of a number of demands from Plaid.

The CWL CEO seems to believe that devolution of the tax would lead to APD reduction or removal. She appears to be second-guessing the result of any climate-change enquiry the WG said it would hold before deciding on how they would apply APD powers.

A point I've raised before is the anti-competitive element with an airport owner being in the enviable position of setting its own APD rates. I wonder if Westminster would take a different view over APD devolution if CWL was owned by the private sector.
 
The BBC news just reported on this and quoted 20% of BRS's passengers coming from South Wales, so approx 1.75 million, more than actually travel from CWL. That should be the concentration.
Never more graphically illustrated than today when I was at BRS changing buses on one of my walks.

Around 10am National Express (Edwards) service 216 came in from Wales and 30-40 passengers got off. By sheer coincidence I was returning home via the airport later in the day around half past two when another service 216 arrived seemingly rammed with passengers - over 50 of them at a rough guess.

That's the situation that exists. It has done for many years and thus far no-one has come up with a proper answer.

It's actually not a case of persuading 1.75 million people to change their travels habits. Given that most people fly out and then fly back (I know that Jerry is a bit of a 'Cook's Tour' enthusiast and sometimes does a circular route pattern :), but most people don't go in for that) the 1.75 million can immediately be halved when it comes to individuals. A lot of people also fly more than one return journey each year so the raw 1.75 million probably relates to fewer than 800,000 individuals. Still a lot but, if 1,000 could be persuaded to use CWL instead, that would boost the airport's passenger numbers by over 2,000 a year. Clearly, they would want many more than that but it shows that for every person captured the numbers go up by the power of at least two.
 
That's the situation that exists. It has done for many years and thus far no-one ha
Because the problems are and always will be trying to persuade the airlines to operate flights from Cardiff and not Bristol and the sheer size of the Easyjet base and there attractiveness. In a way the airport has achieved part of it to a certain degree in the TUI base expansion and Ryanair extra flights but to be more attractive they need more from Ryanair to the extent of the equivalent of 1 or 2 based aircraft. But without the ability to be more attractive to Ryanair than Bristol or southend or Leeds or Manchester as Bristol isn't just the only competition, then it will be an uphill battle for every single flight.
Then there is the perception of the airport in people's minds and that is that it's inferior to all other airports not just Bristol. It's definitely an uphill battle for the airport to try and be competitive and attract passengers back.
As for my travel my itineraries tend to be different for the YouTube channel but for my own personal travel I tend to start and end at Cardiff but in my way maybe itineraries using both airports should be encouraged more?
 
I think a lot of the younger generation in South Wales tend to fly from Bristol, because of the numerous destinations and prices available with Easyjet and Ryanair. there is a party of 18 women from my area flying from BRS to Valencia tomorrow. My young next door neighbour went on a hen party to Barcelona last month with Easyjet, when I pointed out to her that her party could have flown from CWL she said they didn't even look at CWL because they preferred Easyjey. It is and will be very hard for CWL to change peoples views especially the younger generation.
 
I think a lot of the younger generation in South Wales tend to fly from Bristol, because of the numerous destinations and prices available with Easyjet and Ryanair. there is a party of 18 women from my area flying from BRS to Valencia tomorrow. My young next door neighbour went on a hen party to Barcelona last month with Easyjet, when I pointed out to her that her party could have flown from CWL she said they didn't even look at CWL because they preferred Easyjey. It is and will be very hard for CWL to change peoples views especially the younger generation.
I don't think it's just the younger generation. Easyjet has an attractive brand to most age groups.
 
I'll delete if this link is against house rules. Nice little summary of what's been said on here really.

 

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