A new report on airline competition, by a House of Lords Committee charged with scrutinising European policy, should be compulsory reading for the Governments of every EU member state with an interest in international aviation.

Bob Ayling, British Airways’ Chief Executive, said: “I was delighted to see that the Committee’s foremost recommendation is that airline competition should provide a good deal for the consumer. That is the principle which drives our business. Similarly, we share their belief that the airline industry should be treated as any other industry in terms of competition rules - or any other rules, for that matter.

“Britain has led Europe in deregulating the airline industry. It is fitting that it is in the open market of the UK, rather than elsewhere in Europe where nationalised airlines are still fiercely protected, that such a report should be produced.”

British Airways said that it broadly accepts the report`s recommendations but it believes that many of the changes called for will take a long time to bring about.

While British Airways supports the Committee`s call for a new system of slot regulation, it emphasised that the guiding principle should continue to be that slots are allocated to those companies that can use them most effectively.

Bob Ayling said: “There have been at least two CAA studies, more by the EC, and more still by Parliamentary committees, into alternative ways of allocating slots. Time and again, the conclusion has been that the current system - which operates worldwide - cannot be improved on. Slots go to those airlines which will use them most effectively and grandfather rights ensure that massive investment in aircraft and facilities will secure a proper return. But British Airways have no objection to a bidding principle if it applied at all European airports and protected the existing huge investment by airlines .”

“Investment is made by airlines on the basis that existing rights will be honoured and those rights should certainly not be revoked without compensation.”

Bob Ayling added: “We support the Committee`s recommendation to push change through, but in practice this needs the EC and the Governments of each member state to concentrate on creating the climate for change.

“British Airways also strongly supports the need for ownership restrictions to be removed. This, however, can only be achieved on a worldwide basis at the same time.”

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