Proposed repeal of Air Transport Permits (Jersey) Law 1998.

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A decision made (17/02/2007) regarding: Proposed repeal of Air Transport Permits (Jersey) Law 1998.

Subject:	Proposed Repeal of Air Transport Permits (Jersey) Law 1998.
Decision Reference:	MD-E-2007-0044		Exempt clause(s):	None
Type of Report: (oral or written)	written		Person Giving Report (if oral):	n/a
Telephone or e-mail Meeting?	e-mail		Report File ref:	LL\ED\P&S\Air
Written report – Title	Proposed Air Transport Permits (Repeal) (Jersey) Law 200-
Written report – Author (name and job title)	Piers Baker – Strategy Manager
Decision(s): To request the Law Draftsman to prepare a draft Law to repeal the existing Air Transport Permits (Jersey) Law 1998.
Reason(s) for decision: The Decision will allow the current Ministerial policy to be implemented. This is in accordance with the “Air Transport permits: Revised Policy Statement”, presented to the States on 4 November 2003 and reiterated in Paper “Sea Transport: Revised Policy (P.14/2006) – Comments” presented on 28 March 2006. Details are contained in the accompanying Report.
Action required: Following the Ministerial Decision, the Strategy Manager will request that the work is undertaken. The matter has been already discussed with the Law Draftsman. There are no new financial or human resources issues arising.
Signature: Senator P.F.C.Ozouf (Minister)		Date of Decision: 17 February 2007

Proposed repeal of Air Transport Permits (Jersey) Law 1998.

Economic Development Department

Proposed Air Transport Permits (Repeal) (Jersey) Law 200-

Report

Background

The Air Transport Permits (Jersey) Law 1998 was introduced to manage the applications for airlines to fly between Jersey and the United Kingdom and other British Islands. This management of services was purely an economic and social protective measure with matters of safety covered by the United Kingdom Civil Aviation Authority requirements.

The process operated effectively and efficiently for some four years. Each transport provider applied to the department for a permit for new cargo or passenger services. Applications had their merits and disadvantages weighed and duly considered before a decision was made. The principles behind this process were broadly liberal but it was believed that permits should be withheld where –

· the provision of the air transport service proposed would be contrary to the best interests of persons using or likely to use air transport services between the Island and other places in the British Isles;

· the operating of charter flights or summer-only scheduled services would have an adverse impact on the year-round scheduled services;

· the particular circumstances of the Channel Islands justified the retention of a licensing power to protect the interests of the users of the Island’s air transport services.[1]

In November 2003 the Economic Development Committee produced a revised policy (ibid). This was due to a changing external environment with considerable de-regulation in the United Kingdom, the States own policy towards encouraging competition and the establishment of the JCRA.

Thus the Committee of the day stated: “that the interests of Island businesses, residents and visitors alike are to be best served by further encouraging competition, and avoiding the imposition of unnecessary administrative costs either on the airlines or on the authorities. This is in line with the States economic policy generally. It will also bring the Island into line with the “open skies” policy of the European Union.” (op cit at paragraph 6)

Since that time, the legislation has been kept in place and processes duly followed but the old requirement for an airline to enter into a service level agreement was dropped. Additionally, the presumption has been that all permit applications would be granted.

The Case for Repeal

At the time, the Committee believed that this ‘open skies’ policy would not be detrimental to Islanders, the business community or tourism. Since the policy came into effect, there has been no evidence of a loss of year-round services that can be attributable to a rush of summer only charter flights nor has there been a major reduction to the number of routes served. High-frequency inter-Island flights have not suffered either.

To justify continued regulation and government intervention in markets the Economic Growth Plan seeks evidence of a clear need which is in the Island’s interest. Firstly, there should be a market failure and secondly evidence that intervention will actually bring net benefits to the Island.[2] Neither of these is the case.

The 2004-5 Red Tape Reform initiative was intended to reduce unnecessary bureaucracy. Likewise, the States Strategic Plan [3], makes the commitment to “aim to reduce the levels of ‘red tape’ and regulatory legislation in 2006” (Commitment 1.7.4) and that regulatory services should be “appropriate and are impartially and efficiently delivered” (Commitment 2.4). The Economic Development Department are specifically charged with securing air links that are “both cost-effective and beneficial to the Island” (Commitment 6.5.2).

The old Committee produced a detailed consultation document on the development of future air and sea transport policy in May 2005 and agreed it in November. The Minister subsequently approved a revised Air and Sea Transport Policy earlier this year. This was supported by the Council of Ministers in its February meeting. As part of the policy it was decided that “the continuation of the present ‘open skies’ policy for air transport services will be in the best interests of the Island and of the users of these services” and that “the Air Transport Permits (Jersey) Law 1998, as amended, should be repealed.” This policy was presented to the States on 28 March 2006 as part of the response to a Proposition from Deputy Fox concerning Sea Transport.[4]

The continued application of a Law that no longer serves a purpose cannot by justified and for the reasons given above it is time to repeal it.

Manpower and Financial Implications

Initially, there is a manpower implication for the drafting of the necessary repeal legislation. However, the Law Draftsman has indicated that this is a minor and routine matter.

Thereafter, there are no additional manpower or financial implications. The loss of the requirement to administer the Law will mean departmental officers will be able to focus more on achieving the economic growth plan and less on regulatory functions.

European Convention on Human Rights

The provisions of an Air Transport Permits Repeal Law will be drafted to be compatible with the Convention Rights.

Recommendation

The Minister is asked to approve the drafting of an Air Transport Permits Repeal Law.

Strategy Manager

16 October 2006

[1] Extract from old policy as stated in paragraph 5 of Air Transport Permits: Revised Policy Statement RC47/2003

[2] Growing Jersey’s Economy – An Economic Growth Plan, p58, published 1 March 2005

[3] States of Jersey Strategic Plan 2006 – 2011, approved by the States 27 June 2006

[4] Sea Transport: Revised Policy (P24/2006) - Comments