6th July, 2016
Nearly two weeks ago, the UK was in shock following the result of the EU referendum, with 52% of the UK public voting to leave the European Union. There are still major uncertainties for the UK ahead but here we take a look at the reaction of the industry and NGOs, and at some of the changes to the political landscape, to try to gain an understanding of what leaving the European Union could mean for our work.
What does Brexit mean for the aviation industry?
The predicted economic impacts of Brexit have left the future of the UK’s aviation market now looking quite different from the world imagined when the Airports Commission undertook its assessments. The pound has fallen significantly in value and the last time this happened (during the 2008 recession), the number of air passengers decreased considerably as people cut down on flying. Preliminary estimates by the airline association, IATA, suggest that “the number of UK air passengers could be 3-5% lower by 2020, driven by the expected downturn in economic activity and the fall in the sterling exchange rate. The near-term impact on the UK air freight market is less certain, but freight will be affected by lower international trade in the longer term.”
Flights to and from the EU are, meanwhile, an important and significant component of the UK’s aviation industry. The EU is easily the single biggest destination market from the UK, according to IATA, accounting for 49% of passengers and 54% of scheduled commercial flights. EU countries account for the majority of UK holiday destinations, with 76% of UK holidays being taken in the EU. In addition, 68% of business visits from the UK are to EU countries, and 73% of business visitors to the UK are from EU countries. Whether or not all these flights will be sustained in the future depends on the UK’s relationship with the EU after Brexit, especially if there is a restriction imposed on the free movement of people into and out of the UK.
There already seems to be concern in the industry about what could happen to the UK aviation market, with EasyJet suggesting it could move its headquarters from the UK.
What does Brexit mean for airport expansion?
The Brexit vote and subsequent Prime Minister’s resignation have led to a delay in the Government’s decision on airport expansion. The leading candidate to succeed David Cameron, Theresa May, has a constituency near Heathrow but has recently been quiet on the subject of Heathrow expansion.
Brexit may be used by proponents of expansion to up the pressure for a favourable decision. Sir Howard Davies, former chair of the Airports Commission, made the case on the Today Programme, for example, for a decision to be made ‘as soon as possible’ to counter the impression that the UK is ‘turning in on itself’. Given the industry assessments anticipating a significant and long-term impact on passenger growth, however, the demand case for a new a new South East runway surely needs reviewing.
How will Brexit affect environmental legislation?
There’s been much early analysis of what Brexit could mean for environmental protection in the UK (since many regulations were agreed in Brussels), and for the UK’s leadership on climate change, including this very good assessment by Dr Charlotte Burns of the University of York.
Some of the key legislation for aviation has been developed at a national level, independently of the EU, most notably the Climate Change Act. Maintaining full access to the Single Market may, in any case, require the UK to demonstrate compliance with EU environmental legislation, including having to abide by the Environmental Noise Directive and Ambient Air Quality Directive.
However, Client Earth have indicated that while its on-going court case against the UK Government for air pollution breaches won’t be affected, it may be harder for future cases to be enforced through the courts after Brexit.
Amid the current uncertainty about the implications of Brexit, AEF will be continuing to campaign for the protection of public health and for effective climate change policy, whether that comes from the EU or the UK. And we will continue to make the case for the Government’s decisions about aviation and airports to be consistent with these policies, and based on up-to-date environmental evidence.
Written with help from Rosie Coyle