2. In light of a report by the Welsh Affairs Committee stating air passenger duty should be fully devolved to Wales, will the Minister outline the Welsh Government's plans for abolishing or reducing the rate if the power is transferred to Wales? 322

Yes, of course. Our intention would be to use APD to secure optimal growth for both the airport and for Wales, working with the other levers available to us. Ultimately, this means giving serious consideration to reducing APD rates. Any proposed changes to APD would be impact assessed and, of course, subject to full consultation with businesses and, importantly, the public.

Thank you for that answer, Minister. I am a little concerned by your pronouncements over the last couple of days where you said that APD, if transferred, could go up, in light of the former First Minister's comments, in particular on long haul, where he said,

'yes we start from the position of looking to get rid of it, certainly not to increase it.'

You, yourself, are on record as saying that if APD was transferred and lowered, potentially an extra 0.5 million passengers could use Cardiff Airport. I'm unaware of a consumer tax that, if it's raised, actually incentivises people to use it. So, can you clarify your comments, and in particular some of the remarks of the finance Secretary, that, given some of the pronouncements that have been made by the Welsh Government over the last couple of weeks, actually instead of decreasing APD if it was to be transferred, you as a Government might well be looking to increase it to meet your environmental goals?

No, I don't believe that I have suggested that it could be increased. I think I said that any consideration of varying APD would have to be set against the environmental impact, and we'd have to vary APD in line also with our obligations and requirements under the Well-being of Future Generations (Wales) Act 2015. We've always been clear in saying that we would use APD to make Cardiff Airport and Wales more competitive.

Now, I believe—based on emerging technology and the way that the aerospace industry is going and the new fuel systems that are being adopted by aircraft carriers—that we would be able to increase passenger numbers utilising APD and potentially reducing it or abolishing it in a way that would have a net carbon benefit for the environment. I think that that would have to be tested, of course, against a thorough environmental impact assessment, but in no way have I said that I would be raising—or that the Government would be raising—APD. Quite the opposite. Our position is still that our preference would be for the removal or reduction of APD.  

It can be a bit frustrating sitting on these benches. I very much welcome the report from the Welsh Affairs Select Committee. We're pleased that the argument and that opinions from politicians and other political parties are catching up with us, whether it’s on the devolution of policing, or the pop tax, or now air passenger duty. It can be frustrating waiting for others to come on board with our ideas, but we are there.

I was looking back at a vote in 2014, when Jonathan Edwards was talking in a debate on the Finance Bill. All Conservative Members of Parliament voted against the devolution of air passenger duty. None of the Labour Members turned up for that one. But, we are where we are today. My question, quite simply, to the Minister is how will he now use this report as an additional lever in order to try to get the UK Government to change its mind.

Well, I think that, first and foremost, the UK Government need to respond speedily to this report. As the Chair of the committee himself said, he doesn't always favour the devolution of powers, but he recognises how important this could be in helping Cardiff Airport and Wales become far more competitive. There are, of course, two questions. On whether to devolve it, in all fairness to politicians on all sides, I think that many politicians have had a consistent, long-held view about whether to devolve it. Some have opposed it. Some have been in favour of it. But, I think that all Members have held their positions for quite some time and, in all generality, Dirprwy Lywydd, Members have been consistent in their approach.

The second question is what to do with it. We've always been clear that we wish to use it as an additional tool to make Cardiff Airport more competitive, to drive up passenger numbers, to reduce the number of car journeys that are undertaken—in our view, unnecessarily—from the catchment area of Cardiff Airport to airports such as Gatwick, such as Bristol. And, if you can take cars and other vehicles, and particularly freight, off the motorway network, you are in turn reducing carbon emissions. And, as I said in answer to Andrew R.T. Davies, technological changes are occurring at great pace within the aerospace industry. We are at the forefront of supporting Airbus in capturing the wing of tomorrow, in developing new composite materials, because energy efficiency, fuel efficiency, is the name of the game, in terms of how to become competitive in the aerospace sector. And, of course, just recently, Virgin Atlantic operated a flight from Orlando to Gatwick using, incredibly, waste carbon dioxide from a steelworks. That demonstrates how the sector, how aircraft transport, is becoming far more responsive to environmental concerns. 

Is the Minister suggesting the devolution of APD as an alternative to the M4 relief road? I'm not sure it would be on the same scale in terms of impact on congestion. I wonder, though, could he clarify, because he's used this word 'varying APD', and I think Andrew R.T. Davies has, entirely understandably, considered that might reflect a change of policy from the previous First Minister saying 'reducing', since varying may mean either increasing or reducing. The Minister has also said that he wants to consider this decision in light of environmental impact assessments, and I've heard some people—at least from a sedentary position on the Plaid side—suggesting that APD might need to go up in order to reduce the climate change impact. 

Can I also just ask for clarity on the legal situation here? You said just now that the well-being of future generations Act requires these environmental impact assessments. If so, why wasn't this realised or at least spoken about previously? And why didn't he take the opportunity of the 2017 York—sorry, the York Aviation report was 2014, but the Northpoint study in 2017 that his Government commissioned, that looked into quite a lot of these issues around where traffic was going to go? Why didn't that also consider the environmental impact? You also mentioned just now that it could lead to an increase of up to 500,000 passengers from Cardiff Airport. The York Aviation report said it might reduce Bristol by a million, and even his own Northpoint report said it might reduce Bristol by 600,000. So, why that discrepancy?

Well, I think, first of all, the Northpoint Aviation report, which was peer-reviewed, Dirprwy Llywydd, presented evidence that showed there'd be reduced carbon impacts as a result of shorter road journeys to Cardiff Airport if APD was devolved and the rates were subsequently reduced. And that's why we've always held the position that our preference would be to reduce or abolish APD. That position has not changed. But it is only right and proper and responsible to ensure that a decision on whether to vary downward, in this case, APD, is acceptable for businesses and the people through a consultation, and is in line not just with—and I think the Member may be conflating two pieces of legislation—not just with the well-being of future generations Act, but also, crucially, with the environment Act as well. 

But, as I've said, it's my view, based on the evidence that's been presented, that reducing or abolishing APD, and therefore attracting more passengers to Cardiff Airport away from more distant airports, would lead to carbon reduction on the whole. 

Thank you. The third topical question this afternoon, again to be answered by the Minister for Economy and Transport. Jayne Bryant.