Heathrow boss attacks No 10 over lack of support for airports
The chief executive of Heathrow airport has a blunt message for No 10: “Wake up and smell the French roast.”
John Holland-Kaye has spent the morning conceding in broadcast interviews that his airport, previously the busiest in Europe, has been overtaken by Paris Charles de Gaulle.
“The French understand just how important aviation is to a thriving economy,” he told The Independent. “I don’t think the UK government does.
“The fact that Heathrow has now lost its leadership position as the biggest airport in Europe should be a wake-up call to the government.
“Unless they wake up and and take action to protect aviation, then Britain will start to fall behind just as Heathrow has started to fall behind.
"That way millions of jobs will be lost that could have been saved.”
In a normal year, in late October, Heathrow would be reporting third-quarter results with record passenger numbers for July, August and September, and generous dividends for its shareholders – led by Ferrovial of Spain, with 25 per cent, and the Qatar Investment Authority, which owns one-fifth.
Instead, Mr Holland-Kaye has revealed a collapse of 84 per cent in passenger numbers for the peak summer months. The last time levels were so low between July and September was in 1967, before the Boeing 747 was flying.
He is calling on the prime minister, who is an avowed opponent of expansion at Heathrow, to come to the rescue.
“This is a chance for leadership but it has to start with a point of view that aviation is a force for good, it’s going to help to keep people in jobs, and it can be done safely,” says the Heathrow chief executive. “That's where we really need some leadership from No 10 to make that happen.”
The hub had a highly successful start to the year, before the coronavirus crisis triggered a slump in flying, but in April the airport handled fewer passenger all month than in a single day a year earlier.
In the first nine months of the year, earnings from airport shops and catering have fallen by two-thirds compared with 2019.
Revenue from the Heathrow Express rail link to London Paddington, which the airport owns, slumped by three-quarters.
Heathrow has actually performed much better during the coronavirus pandemic than most UK airports, and has actually gained market share – primarily from Gatwick, from which BA and Virgin Atlantic have moved aircraft.
But Mr Holland-Kaye says he fears for smaller airports.
"The rates bill that Tesco and Sainsbury’s have been paying, about £500m a year, they’ve been given alleviation from that – they don’t have to pay that bill, even though their business is booming, while poor old airports get no business rates alleviation even though it’s their biggest single cost factor other than employment,” he said.
“That’s a real sign that the government does not understand how important aviation is to the UK economy.”
The chief executive has also cut Heathrow’s forecast for 2021 passenger numbers by 41 per cent from the estimate just four months ago.
Heathrow now predicts 37.1 million passengers will use the airport next year, the same as in 1988. The airport blames the lower forecast on “slow progress on introducing testing by the UK government to reopen borders with ‘high-risk’ countries”.
At present almost all travellers arriving in the UK must self-isolate for 14 days. Only a very few major countries are exempt.
Facilities for testing on arrival – “day zero” – have been in place at Heathrow for three months. But the transport secretary, Grant Shapps, has rejected the option, saying: “We know for certain that if you were to test people on day zero, that isn't going to help.
“It is true to say, I'm afraid, I know this has been hotly disputed, and this is what has taken time to get to the bottom of, that you’d only pick up about seven per cent of those who are asymptomatic coming off that flight on day zero.”
Mr Shapps is co-chairing the Global Travel Taskforce with the health secretary, Matt Hancock. It is due to report by early November and is likely to recommend a test for Covid-19 after about a week of quarantine, roughly halving the time spent in self-isolation.
Mr Holland-Kaye says: “Post-arrival testing is something entirely within their control and we need to keep working with government to make sure that it actually happens. And for many people who are visiting friends and relatives, even some business travellers, that will help them to go about their normal business.
“Pre-departure testing is the holy grail. There is consensus around the aviation and travel industry that that is the right way to go.
“As a passenger, it’s very confusing as to whether you need to have a test or not before you get on the plane, what kind of test it needs to be, how long it needs to be done [in advance] and that's what creates this real confusion for passengers.
“All that does is to put people off travelling. We need some clarity on this, and if we can get the US, the UK and the EU to align on a way of having pre-departure testing, that will take a lot of the rest of the world with it."
There has been much speculation that the procedures could be tested on a pilot “air bridge” on what was previously the busiest and most profitable intercontinental air route in the world, between London Heathrow and New York JFK.
“If it doesn't happen between New York and London, it’ll happen between New York and Paris or New York and Frankfurt, and the UK will yet again be left behind," says Heathrow’s chief executive.
“Here’s a chance for the UK to show real leadership. Will they take it? That really depends on No 10.”
A spokesperson for the Department for Transport (DfT) said: “Our priority has always been to protect the public and manage the risk of new cases being imported from abroad.
“The government’s Global Travel Taskforce is working at pace, with clinicians, devolved administrations and the travel industry to develop measures as quickly as possible to protect air connectivity and consider how testing could be used to reduce the self-isolation period.”
Two aspects of good news appeared in Heathrow’s otherwise dismal third-quarter results: the proportion of on-time departures has risen from 80 to 87 per cent, and the proportion of failed baggage connections has fallen by one-fifth.
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