My name is Simon Buck, Chief Executive of the British Air Transport Association (otherwise known as BATA) and it is a pleasure to see you all today. Firstly,

May I thank you Graham for very kindly hosting this reception for us today.

I’d like to say just a few words about BATA and the key role that aviation plays in the UK economy.

BATA is the trade body for UK-registered airlines, with members representing all sectors of the industry, scheduled, charter, low-cost, regional and cargo. BATA members employ over 71,000 people, operate over four-fifths of the UK commercial aircraft fleet and are responsible for some 96% of UK airline output, carrying 119 million passengers and 1 million tonnes of cargo each YEAR.

Aviation is sometimes referred to as the real world wide web and plays a crucial role providing international connectivity for our island nation. Domestic air links also fulfil an essential role for the remoter parts of the UK regions – it’s important to note that about 85% of these air routes are over water and could not realistically be substituted by high speed rail.

In terms of economic impact, aviation contributes over £50 billion a year to UK GDP and supports almost a million jobs. Aviation also raises almost £9 billion in tax and duty each year for the government. Not bad for an industry that some say is undertaxed.

But enough of dry statistics.  Airports play a vital role in the regional economies of the UK serving as a magnet for business, providing regional connections both nationally and internationally. Nearly everybody in the UK has at some time flown by plane and the vast majority hope to fly as often or more frequently in future – be they residents of West Dorset or Sheffield, no

Matter what the reported view of some politicians may be!  Visits by British citizens overseas not only enrich our own lives but help provide much needed revenue for many developing countries who rely on tourism as the main part of their economy.

Even within the UK, the prime minister has identified tourism as the third highest export earner behind chemicals and financial services, playing a vital role in rebalancing our economy. Indeed, about three out of four overseas visitors come to the UK by air. However, the tax take on flying, known as air passenger duty, has soared by 16% in the last year and more than doubled in the last five years. At the same time, air passenger numbers have now dipped to their lowest level for seven years. While the recent decision by the chancellor not to increase the tax this year is to be welcomed, his announcement that the tax will rise by twice the rate of inflation next year will do nothing to make the UK a more affordable place to visit or boost our faltering tourist numbers. APD already raises more than the tax on the banks known as the bank levy and will cost air travellers over £15 billion the next five years. We urge him to listen to the fair tax on flying campaign, in which BATA plays a key part, and reconsider this decision – especially in the light of aviation entering the EU emissions trading scheme from 1st January next year.

ETS will offer a far smarter way of addressing aviation’s environmental impact than a blunt tax that simply makes the UK uncompetitive and increasingly unaffordable both for business and tourism alike.

We would, in fact, go further and urge the chancellor to follow the example set by the new irish coalition government that has recently announced it will be scrapping its tax on flying and instead challenging its airlines to increase tourist numbers thus boosting the Irish economy. Mr Osborne, British airlines and the entire British tourism industry would welcome a similar fiscal initiative and challenge!

Over the last few years, BATA has been playing a significant role in the sustainable aviation initiative. This initiative is unique in the UK transport sector in representing a proactive coalition of airlines, airports, engine and airframe manufacturers and air traffic management providers to address aviation sustainability issues. Great strides have been made in recent years in improving the environmental performance of aircraft but we are committed to working together further to improve aviation’s environmental performance and ensure sustainable growth. We recently published our latest progress report and copies of the two page executive summary are available for you to take away.