Cheap Flights cause another record Trade Deficit

UK appetite for cheap flights shows no signs of abating

The rapid growth in cheap leisure flights resulted in a record hole in the UK trade balance last year according to figures published today by the Office of National Statistics (‘ONS’).

The figures (from ‘Travel Trends 2006’) show that UK residents took 56.5 million overseas flights in 2006 more than double the number of incoming foreign visitors (24.6 million). The net impact on the UK trade balance was a deficit of almost £19 billion (£18.85 billion).

Ten years ago (1996) the UK trade deficit on international air travel was just £2.3bn but it has grown dramatically since then as the number of overseas trips by UK residents has more than doubled while the number of foreign tourists visiting the UK has increased at a much slower rate.

Leisure flights are the main driver of growth and less than one in seven overseas trips by UK residents is now for business purposes.

These latest figures from the ONS again call into question the Government’s claims that its controversial airport expansion plans are essential for the UK economy. The Government is expected to announce later this week that it intends to proceed with plans for a third Heathrow runway, increasing its capacity by 50%.

The Government relies upon the claimed economic benefits of airport expansion to justify the clear contradiction between its support for massive airport expansion in the UK while claiming that it is in the forefront, internationally, in tackling climate change.

Brian Ross, economics adviser to Stop Stansted Expansion commented: “These latest figures from the ONS showing a record trade deficit on air travel demonstrate that it’s time for the Government to abandon the myth that endless growth in air travel is necessarily beneficial for the UK economy.”

Mr Ross continued: “The Government would also do well to recognise that its airport expansion plans – whether for Heathrow, Stansted or elsewhere – are simply not reconcilable with its claims to be committed to tackling climate change.”

NOTES

‘Travel Trends 2006’ was published by the Office of National Statistics (ONS) on 19 November 2006. It provides information on inward and outward visitors to/from the UK travelling by air including expenditure data but excluding expenditure on air tickets. The latter can be obtained from 2007 edition of The Pink Book also published by the ONS.