Photo: Getty
Show Hide image

London Gatwick. Obviously.

“Gatwick – affordable and deliverable”

Gatwick’s chairman, Sir Roy McNulty, takes on aviation arguments from the other side and urges a new government to be decisive. 

Q. Let’s look at some of the arguments Heathrow is making. What of its claim to be the UK’s biggest port?

A. This is a hangover from the British Airports Authority monopoly. If you look at the freight situation, there’s an enormous amount to be said for creating some more competition. Gatwick is the only viable way of doing that.

Q. So is this a legacy issue?

A. A huge market share is impressive from one point of view. However, huge market share is not a great thing from a competition and efficiency point of view.

Q. What about the argument that the centre of economic gravity is to the west of London, not to the south?

A. If you look at the Airports Commission’s analysis and that of the Mayor of London, there is common consensus that the area to the west of London and around Heathrow is severely overheated. There’s tremendous pressure on roads and other infrastructure. There’s tremendous pressure on housing and there are environmental pressures, too. There’s much to be said both nationally and in and around London for more balanced growth.

Q. Another point – isn’t it true to say that transfer passengers are the only way to make long-haul routes financially viable for airlines?

A. That’s an argument of 15 to 20 years ago.

Q. Why is it the wrong argument for today?

A. Western European hubs, including Heathrow, Frankfurt, Amsterdam and Paris, are losing transfer market share rapidly to the hubs in the Middle East. These newer hubs are much better placed geographically for today’s traffic patterns, which are focused on journeys to and from the Far East. The second thing to look at is the pattern of aircraft orders. Airlines are ordering large numbers of aircraft like the 787 and the A350, the so-called hub busters. Those aircraft do not need large proportions of transfer passengers to operate economically.

Q. Are you saying the hub concept is outdated, or that Heathrow is in the wrong place?

A. It’s a bit of both. If you want to base a business on transfer passengers you wouldn’t locate it at the western edge of Europe today. Consider that one of the big transfer flows is from North America to India. The natural stopping-off place was western Europe. But now the 787 and A350 can fly direct. Nobody likes stopping off to transfer – it’s a pain in the neck.

Q. So do these newer aircraft remove the argument about the financial viability of transfer traffic?

A. Absolutely. The 747 and others like it needed transfer traffic in the order of 30 to 40 per cent to be viable. With the 787 and A350 you can easily get by with 10 per cent transfer traffic.

Q. An airport to the west of London will always have better connections to the rest of the country than one to the south. How do you respond to that proposition?

A. I don’t buy that. If you’re in Northern Ireland or Scotland, you’re not going to want to get to London by road and, in the case of Northern Ireland, you’re not going to do it by rail. You’re going to fly, and it’s immaterial whether you fly to and from Heathrow or Gatwick.

On rail, one of the things that most people don’t yet understand is the extent to which Gatwick’s rail connections will be revolutionised by Thameslink. It represents a bigger increase in capacity for us than Crossrail does for Heathrow.

Q. Heathrow has promised to review regional pricing to help boost air links to Scotland. Won’t that be very welcome, from a regional point of view?

A. The Scots are very sensible people. When they see somebody promise a review, they wait to see the colour of their money. And bearing in mind that Heathrow’s charges are the most expensive in the world, you’d need to review them an awful lot to make them competitive.

Q. Business opinion from the likes of the Institute of Directors and the British Chambers of Commerce appears to be weighted against Gatwick. Do you accept that description as fair?

A. Within the business community there is a spectrum of opinion. Within the IoD, for example, the Gatwick support is far from negligible. And if you go to the Federation of Small Businesses and people who are in a start-up or small-business situation – and where they worry about the cost of travel – you’ll find sizeable support for Gatwick.

Q. In addressing all these arguments what part of the Gatwick proposition has been missed?

A. We missed the fact that with the Commission’s projections on traffic and connectivity, the end result for the UK as a whole is much the same, whichever airport is chosen. In other words, the choice of scheme doesn’t really matter in terms of what the original purpose of the exercise was – to deliver the connectivity the UK needs.

At Gatwick, the expansion we have designed is much better able to serve all the different types of airline business models. No matter what it does with a new runway, Heathrow is largely configured for full-service carriers of a traditional type. Gatwick is a more flexible solution.

Heathrow is a big bet on the hub concept – but suppose, as has been the history of aviation, things move on. If you look fifty years ahead, Gatwick presents a much more flexible solution and proves much more robust to market changes in the future than the alternative.

Q. So what, in your view, are the strengths of the Gatwick case?

A. First of all it’s a much more affordable option. We’re into unknown territory with the new government but the one thing we can be sure of is that the public finances will be at least as tight in the next five years as they have been in the last five years. Heathrow is looking for a public subsidy of something between £5bn and £6bn for surface access. There isn’t going to be a great deal of spare money for propositions like that.

The Gatwick project will cost less than half the Heathrow project. Gatwick airport charges will be half the charges at Heathrow. So in terms of being a more affordable proposition, Gatwick is streets ahead. And we have guaranteed that our airport charges will not exceed £15 per passenger.

Q. What about environmental considerations?

A. Heathrow remains a huge challenge in terms of noise impact. Over 300,000 people will be newly affected by significant noise if the Heathrow plans go ahead. That is going to be a huge hurdle for them to get over. And on top of that they still haven’t solved the air quality problem that dates back to 2009. They are still exceeding the legal limit the European Commission has laid down and there’s really no solution in sight for that problem. On those criteria, Gatwick is much more deliverable.

Having said all that, the most important thing is that something does happen.

Q. How hopeful are you that something will happen this time?

A. The problem of aviation capacity is much more pressing than it was 20 years ago. To an extent, we were all rescued by the recession of 2008/2009. If that hadn’t happened, the capacity constraints really would be hurting today. The recession has given a bit of breathing space but Heathrow is nearly full today and we are heading that way at Gatwick.

Q. And do you believe the politicians will make a choice?

A. The likelihood of them making a choice is much higher today than it was even ten years ago. Having set up this commission to make a recommendation, to then flunk the decision and make no decision would be an absolute disgrace.

The politicians we’ve been speaking to in the last couple of years are very aware of this. The airport capacity issue has to be dealt with.

Sir Roy McNulty is the chairman of Gatwick Airport Ltd

To download “Rethinking the Debate on Aviation Capacity”, a New Statesman special supplement created in association with Gatwick Airport, go to tinyurl.com/aviationcapacity

Jon Bernstein, former deputy editor of New Statesman, is a digital strategist and editor. He tweets @Jon_Bernstein. 

Getty
Show Hide image

Chuka Umunna calls for "solidarity" among Labour MPs, whoever is voted leader

The full text of shadow business secretary Chuka Umunna's speech to Policy Network on election-winning ideas for Labour's future, and the weaknesses of the New Labour project.

There has never been an easy time to be a social democrat (or “democratic socialist” as we sometimes call ourselves in Britain). Whereas the right can demonise the poor and extol the virtues of the market, and the hard left can demonise the market and extol the role of the state, our position of constraining the domination of markets and reforming the state is, by definition, more complex.

It is nonetheless the case that social democracy has a historic responsibility, in every generation, to renew democracy and preserve a civic culture. This is achieved not through soundbites and slogans, but through the hard-headed development of a progressive politics that reconciles liberty and democracy, new comers and locals to our communities, business and workers, in a common life that preserves security, prosperity and peace.  This historic mission is all the more urgent now and my determination that we succeed has grown not weakened since our election defeat last May.

But, in order to be heard, it is necessary to make balanced and reasonable argument that both animates and inspires our movement, and which is popular and plausible with the people.  The first is pre-requisite to the second; and there is no choice to be made between your party’s fundamental principles and electability. They are mutually dependent - you cannot do one without the other.

We are in the midst of choosing a new leader and it is clear to anyone who has watched the UK Labour Party leadership election this summer that amongst a significant number there is a profound rage against Third Way politics – as pursued by the likes of Bill Clinton, Tony Blair, Gerhard Schröder and others - as a rejection of our fundamental values.

In the UK there is a view that New Labour accepted an uncritical accommodation with global capital that widened inequality, weakened organised labour and we were too close to the US Republicans and too far from the European left.

I do not believe this is fair, not least because we rescued many of our public services from the scrap heap when we came to office in 1997 and there were very significant achievements  we should celebrate.  New Labour renewed our National Health Service in a fundamental way; we built new schools and improved existing ones; we set up new children’s centres all over the country; we brought in a National Minimum Wage; we worked with others to bring peace to Northern Ireland; we introduced civil partnerships.  Just some of our achievements.

However, though we may take issue with the critique, I do not think we can simply dismiss out of hand those who hold critical views of New Labour. Like any government, the New Labour administration made mistakes - it could and should have achieved more, and done more to challenge the Right’s assumptions about the world. In the end, it is not unreasonable to be ambitious for what your party in government can achieve in building greater equality, liberty, democracy and sustainability. It is far better we acknowledge, not reject, this ambition for a better world, as we seek to forge a new politics of the common good fit for the future.

Realising our values in office has been disrupted by globalisation and the surge of technological forces that are displacing and reshaping industry after industry.

Some argue that globalisation as an ideological construct of the right. But we must recognise that we live in an increasingly integrated world in which markets have led to an unprecedented participation of excluded people in prosperity, a rise in living standards for hundreds of millions  of people and a literacy unprecedented in human history – this is particularly so in emerging economies like my father’s native Nigeria. And the internet has led to a level of accountability that has disturbed elites.

Yet, this has been combined with a concentration of ownership that needs to be challenged, of a subordination of politics that requires creative rather than reactive thinking, and these global forces have exacerbated inequalities as well as helped reduce poverty.

So it is important that we understand the sheer scale and impact of new technologies. At the moment we are engaged in a debate about Uber and its threat to one of the last vestiges of vocational labour markets left in London, those of the black taxi cabs and their attainment of 'The Knowledge'. But the reality is that within the next decade there will be the emergence of driverless cars so we have to intensify our exploration of how to support people in a knowledge economy and the realities of lifelong learning, as well as lifelong teaching. As people live longer we will have to think about how to engage them constructively in work and teaching in new ways.

Once again, I'm addressing all of this, Social Democracy requires a balanced view that domesticates the destructive energy of capital while recognising its creative energy, that recognises the need for new skills rather than simply the protection of old ones. A Social Democracy that recognises that internationalism requires co-operation between states and not a zero sum game that protectionism would encourage.

Above all, Social Democratic politics must recognise the importance of place, of the resources to be found in the local through which the pressures of globalisation can be mediated and shaped. Our job is to shape the future and neither to accept it as a passive fate nor to indulge the fantasy that we can dominate it but to work with the grain of change in order to renew our tradition, recognising the creativity of the workforce, the benefits of democracy and the importance of building a common life.  Sources of value are to be found in local traditions and institutions.

This also requires a recognition that though demonstration and protest are important,; but relationships and conversations are a far more effective way of building a movement for political change.

One of the huge weaknesses of New Labour was in its reliance on mobilisation from the centre rather than organising. It therefore allowed itself to be characterised as an elite project with wide popular support but it did not build a base for its support within the party across the country, and it did not develop leaders from the communities it represented. It was strong on policy but weak on strengthening democratic politics, particularly Labour politics.

Over half a million people are now members, supporters or affiliated supporters of our party, with hundreds of thousands joining in the last few weeks. Some have joined in order to thwart the pursuit of Labour values but many more have joined to further the pursuit of those values, including lots of young people. At a time when so many are walking away from centre left parties across the Western world and many young people do not vote let alone join a party, this is surely something to celebrate.

So it is vital that we now embrace our new joiners and harness the energy they can bring to renewing Labour’s connection with the people. First, we must help as many them as possible to become doorstep activists for our politics. Second, I have long argued UK Labour should campaign and organise not only to win elections but to affect tangible change through local community campaigns. We brought Arnie Graf, the Chicago community organiser who mentored President Obama in his early years, over from the U.S. to help teach us how to community organise more effectively. We should bring Arnie back over to finish the job and help empower our new joiners to be the change they want to see in every community – we need to build on the links they have with local groups and organisations.

I mentioned at the beginning that in every generation Social Democracy is besieged from left and right but the achievements of each generation are defined by the strength of a complex political tradition that strengthens solidarity through protecting democracy and liberty, a role for the state and the market and seeks to shape the future through an inclusive politics. Solidarity is key which is why we must accept the result of our contest when it comes and support our new leader in developing an agenda that can return Labour to office.

Yes, these are troubled times for social democrats. All over Europe there is a sense among our traditional voters that we are remote and do not share their concerns or represent their interests or values.  There is surge of support for populist right wing parties from Denmark to France, of more left wing parties in Greece and Spain and in Britain too. There is renewal of imperial politics in Russia, the murderous and abhorrent regime of ISIL in the Middle East, volatility in the Chinese economy and in Europe a flow of immigration that causes fear and anxiety.

But, the task of Social Democracy in our time is to fashion a politics of hope that can bring together divided populations around justice, peace and prosperity so that we can govern ourselves democratically. We have seen worse than this and weathered the storm. I am looking forward, with great optimism to be being part of a generation that renews our relevance and popularity in the years to come.

Chuka Umunna is the shadow business secretary and the Labour MP for Streatham.