Environmental Engineering Reference
In-Depth Information
In the UK government's current review of aviation policy, maintaining high and
stable levels of economic growth is one of the economic criteria for deciding on the
right level of capacity (DETR, 2000). One way of spurring economic growth is to ensure
that investment finds its way to sectors that make best use of capital and labour. The
aviation sector has an above-average level of labour productivity, a fact mistakenly used
to explain its positive contribution to overall economic growth. A more representative
measure would also consider how productively it used capital. Highly capital inten-
sive compared to other sectors, the effect is to lower aviation's overall contribution to
economic growth.
There are other ways in which the availability of efficient global air transport net-
works may increase investment and productivity in the wider economy. Increased acces-
sibility allows markets to enlarge. Lower transport costs facilitate increased specialization
in international markets, enabling each country to exploit its comparative advantage
in global production. In principle, greater exposure to competition helps to ensure
that people, products and ideas move to where they are most efficiently utilized.
Forecasting these linkages is more difficult. An industry-sponsored report by Oxford
Economic Forecasting (OEF) suggested that capping air transport at today's level
would result in a whole year's worth of economic growth being lost by 2015 (OEF,
1999). It did so while failing to prove a link between air transport and economic growth
and ignoring environmental costs. No attempt was made to consider that future
investments in transport infrastructure could have diminishing or even negative eco-
nomic returns.
In areas where congestion is already a problem, the marginal costs of more people
and goods getting to and from airports could outweigh the benefits of growth. Three-
quarters of international air travel is for pleasure not business, and leisure spending
by UK residents when abroad is greater than spending by overseas visitors in the
UK. The UK£7 billion deficit in spending by UK air travellers (OEF, 1999) is grow-
ing as long-distance air travel becomes cheaper per kilometre than more sustainable
local travel, and incentives to travel further and faster accelerate.
Tax exemptions and subsidies worth an estimated UK£6 billion a year are part
of the reason behind low air-travel prices and high demand (Sewill, 2000). There is
no tax on aviation fuel, no value-added tax (VAT) on tickets, duty-free sales and
cross-subsidy of airport charges by retail activity. If aviation were to pay its way, then
growth would be much more modest, with passenger numbers rising from 160 mil-
lion in 1998 to 240 million instead of 400 million by 2020 (Sewill, 2000).
Raising charges for airport access would make flying more expensive, possibly
hitting those on low incomes hardest. Even if tax exemptions and subsidies were
removed, there would still be around 80 million or 50 per cent more passenger air
trips by 2020 than there were in 1998 (Sewill, 2000). There are likely to be more,
not less, people flying in the future. Leisure flights are discretionary, while the same
cannot be said for the environmental costs associated with air travel. With growth
unchecked, the adverse impacts of aviation will be meted out faster than the indus-
try can mitigate them. In the vicinity of airports, more people will be exposed to the
harmful effects of noise and air pollution.
Aviation's global contribution to climate change will also grow from a 1992 level
of 3.5 per cent to over 15 per cent by 2015, as a percentage of total anthropogenic
carbon emissions (IPCC, 1999). The figure will be greater still if the emissions from
