My Lords, these draft regulations will be made under the powers conferred by the Air Traffic Management and Unmanned Aircraft Act 2021, known fondly by everybody as ATMUA. ATMUA created a more flexible set of powers for Ministers to implement slot alleviation measures related to the impacts of Covid-19, subject to a vote in both Houses. It allows us to tailor our response in ways that were not possible beforehand.
Ordinarily, airlines must operate slots 80% of the time to retain the right to the same slots the following year; this is known as the 80:20 rule or the “use it or lose it” rule. However, the powers provided by ATMUA enable the Secretary of State to provide alleviation from this rule if he is satisfied that there is a reduction in demand due to the Covid-19 pandemic and that the reduction is likely to persist.
Under ordinary circumstances, the 80:20 rule helps to encourage efficient use of scarce airport capacity while allowing airlines a degree of flexibility in their operations. In response to the Covid-19 pandemic, the EU Commission waived the 80:20 rule for the summer 2020 and winter 2020 seasons. Following the UK’s departure from the EU, the UK Government decided to extend this waiver to cover the summer 2021 season, going through until the end of October 2021, through the Airports Slot Allocation (Alleviation of Usage Requirements) Regulations 2021.
Through the provision to airlines of legal certainty that they would be able to retain their slots even if not operated, the commercial impacts of the Covid-19 outbreak on the industry were mitigated. This is because airlines might otherwise have opted to incur costs and operate flights at low load factors merely to retain slots. That would have been bad for emissions and, of course, bad for their finances.
Due to continued uncertainty and low passenger demand forecasts, we set out a package of measures on 19 July to alleviate slot usage requirements for the winter 2021 season, which runs from 31 October 2021 through to 26 March 2022. This package was developed following consultation with the aviation industry and
careful consideration of the responses that we received. Industry expressed a range of views, ranging from calls for a full waiver to support for no alleviation at all.
The draft instrument being considered today applies to England, Scotland and Wales. Aerodromes are a devolved matter in relation to Northern Ireland and, as there are no slot co-ordinated airports in Northern Ireland, the Northern Ireland Executive agreed that it was not appropriate for the powers of the Act to extend to, or apply in relation to, Northern Ireland.
In the draft instrument, the Government have set out a package of alleviation measures designed to work together. These include changing the minimum usage ratio to 50:50, meaning that airlines are required to use their slots at least 50% of the time to retain the right to operate these same slots the following year. The reintroduction of a utilisation rate should encourage efficient slot use while also supporting sector recovery.
Secondly, the draft regulations also allow airlines that hand back a full series of slots to the slot co-ordinator—
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