Secret Squirrel
17th Mar 2001, 04:17
This is the background:
A few months ago someone on this website posted a thread urging us all to write to our MP's re NATS privatisation. If you didn't now who your MP was then all you had to do was go to the House Of Commons website and find out. I did this and wrote to my MP. Fortunately, he took up my cause and wrote to Prescott because, like me, he didn't agree with privatisation either. This is the reply I got back:-
"Dear Paul, (Burstow)
Thank you for your letter of 24th January to John Prescott enclosing this correspondence from your constituent Mr Secret Squirrel of Sutton, regarding the private public partnership of NATS. As you will be aware, the transport bill has completed its parliamentary stages and received Royal Assent on 30 November 2000.
The government remains committed to setting up a public private partnership for NATS. This is in the best interests of air users, the UK and NATS itself. To begin with, we believe that the partnership will make a positive contribution to air safety. Firstly, by separating safety regulation from service provision – something that aviation professionals and airspace users have long urged. Secondly, by ensuring that NATS has access to investment capital outside the bounds of government financial controls. Indeed, if we do not secure substantial new investment for NATS, there would be a much greater risk of a trade off – not between safety and profit, but between safety and delays. The basis for that investment will be the centres at Swanwick and Prestwick, to which we have already committed significant funding, but additional investment of around £1.3 bn over the next ten years is needed to keep pace with traffic growth.
I would like to re-iterate that safety is, and always will be, the overriding priority of our policy. We are committed to maintaining – and improving wherever necessary – some of the most stringent aviation safety standards in the world.
There is no real parallel between Railtrack and the proposals for NATS under partnership in safety regulatory terms. When it was privatised, Railtrack took certain regulatory functions with it into the private sector. NATS will remain subject to regulation by the CAA Safety Regulation Group (SRG), which is highly regarded worldwide, as an effective and professional regulator. They have wide ranging powers to regulate aviation safety and have ample experience of regulating private sector bodies. The governments willingness to enhance the safety regulator’s powers if necessary, was explicitly stated in the consultation paper published in October 1998 and still stands, although the Group Director of SRG considers that his existing powers are adequate to regulate a private sector NATS.
The strategic partner in NATS will be carefully selected under a rigorous procedure to ensure that they are fit and proper to play a role in delivering air traffic control services and that they share our commitment to safety. The government will be looking for potential partners who are seeking the competitive position a stake in NATS will secure – with unique opportunities to expand into new markets – rather than the opportunity to make quick profits. The safety culture within NATS is very strong, and the government, the regulator and NATS together will ensure that this remains the case. There will be no question of putting profits before safety, and we have sought assurances from the CAA safety regulator that this is a robust view.
Ministers fully recognise that ATC is a strategic activity with implications for the national economy, national security and public safety. While we do not believe that this is incompatible with public sector status, it does mean that government – in addition to its shareholding – will need to retain certain powers over the public private partnership in order to discharge its own responsibilities. Wer therefore intend to take certain statutory powers and a special (‘golden’ ;) share that will enable public interest to be maintained while NATS otherwise enjoys commercial freedom. As part of the arrangements to maintain the public interest, the government will appoint two ‘Partnership Directors’ to the board, with explicit guidance as to their role in protecting the government’s interests as an investor. This effective government veto will cover decisions on the strategic and business plans, major investment and divestment proposals, dividend policy and the selling of shares by the strategic partner.
The government has carefully thought about the fundamental point of whether it is right and/or necessary to transfer control of NATS to the private sector. The significant advantage this secures is a guarantee of the necessary investment, without having to find it from public resources – which we believe would be better invested in education and health, where no alternative funding sources are available. We have therefore concluded, having considered safety issues in some detail that a new Partnership Company is the right way forward. This is very different indeed from the privatisation proposed by the last government. We are not selling our air, but mobilising private finance and management expertise to deliver safer skies without delaying passengers or depriving other government priorities of much needed investment.
I hope the foregoing provides some reassurance to your constituent on these important issues."
Bob Ainsworth.
A few months ago someone on this website posted a thread urging us all to write to our MP's re NATS privatisation. If you didn't now who your MP was then all you had to do was go to the House Of Commons website and find out. I did this and wrote to my MP. Fortunately, he took up my cause and wrote to Prescott because, like me, he didn't agree with privatisation either. This is the reply I got back:-
"Dear Paul, (Burstow)
Thank you for your letter of 24th January to John Prescott enclosing this correspondence from your constituent Mr Secret Squirrel of Sutton, regarding the private public partnership of NATS. As you will be aware, the transport bill has completed its parliamentary stages and received Royal Assent on 30 November 2000.
The government remains committed to setting up a public private partnership for NATS. This is in the best interests of air users, the UK and NATS itself. To begin with, we believe that the partnership will make a positive contribution to air safety. Firstly, by separating safety regulation from service provision – something that aviation professionals and airspace users have long urged. Secondly, by ensuring that NATS has access to investment capital outside the bounds of government financial controls. Indeed, if we do not secure substantial new investment for NATS, there would be a much greater risk of a trade off – not between safety and profit, but between safety and delays. The basis for that investment will be the centres at Swanwick and Prestwick, to which we have already committed significant funding, but additional investment of around £1.3 bn over the next ten years is needed to keep pace with traffic growth.
I would like to re-iterate that safety is, and always will be, the overriding priority of our policy. We are committed to maintaining – and improving wherever necessary – some of the most stringent aviation safety standards in the world.
There is no real parallel between Railtrack and the proposals for NATS under partnership in safety regulatory terms. When it was privatised, Railtrack took certain regulatory functions with it into the private sector. NATS will remain subject to regulation by the CAA Safety Regulation Group (SRG), which is highly regarded worldwide, as an effective and professional regulator. They have wide ranging powers to regulate aviation safety and have ample experience of regulating private sector bodies. The governments willingness to enhance the safety regulator’s powers if necessary, was explicitly stated in the consultation paper published in October 1998 and still stands, although the Group Director of SRG considers that his existing powers are adequate to regulate a private sector NATS.
The strategic partner in NATS will be carefully selected under a rigorous procedure to ensure that they are fit and proper to play a role in delivering air traffic control services and that they share our commitment to safety. The government will be looking for potential partners who are seeking the competitive position a stake in NATS will secure – with unique opportunities to expand into new markets – rather than the opportunity to make quick profits. The safety culture within NATS is very strong, and the government, the regulator and NATS together will ensure that this remains the case. There will be no question of putting profits before safety, and we have sought assurances from the CAA safety regulator that this is a robust view.
Ministers fully recognise that ATC is a strategic activity with implications for the national economy, national security and public safety. While we do not believe that this is incompatible with public sector status, it does mean that government – in addition to its shareholding – will need to retain certain powers over the public private partnership in order to discharge its own responsibilities. Wer therefore intend to take certain statutory powers and a special (‘golden’ ;) share that will enable public interest to be maintained while NATS otherwise enjoys commercial freedom. As part of the arrangements to maintain the public interest, the government will appoint two ‘Partnership Directors’ to the board, with explicit guidance as to their role in protecting the government’s interests as an investor. This effective government veto will cover decisions on the strategic and business plans, major investment and divestment proposals, dividend policy and the selling of shares by the strategic partner.
The government has carefully thought about the fundamental point of whether it is right and/or necessary to transfer control of NATS to the private sector. The significant advantage this secures is a guarantee of the necessary investment, without having to find it from public resources – which we believe would be better invested in education and health, where no alternative funding sources are available. We have therefore concluded, having considered safety issues in some detail that a new Partnership Company is the right way forward. This is very different indeed from the privatisation proposed by the last government. We are not selling our air, but mobilising private finance and management expertise to deliver safer skies without delaying passengers or depriving other government priorities of much needed investment.
I hope the foregoing provides some reassurance to your constituent on these important issues."
Bob Ainsworth.