BA's Walsh pleads for relief from pollution-tax burdens

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British Airways is calling for a commitment from the Government that the controversial Aviation Passenger Duty (APD) will be abolished when airlines join Europe's emissions-trading scheme (EU ETS) in 2012.

At the airline's annual general meeting in London yesterday, BA's chief executive, Willie Walsh, said aviation is being forced to meet its environmental costs "several times over".

He also warned that coalition Government proposals to change the APD from a "per passenger" to a "per plane" levy would harm the UK economy and increase global carbon emissions.

The APD is already set to rise in November, leaving airlines paying more that twice their carbon costs, says BA. The multiple will increase even further when airlines join the EU ETS. And the UN recently tabled plans for an annual $10bn (£6.6bn) tax on the global industry as part of the $100bn (£66bn) fund proposed at the Copenhagen climate-change summit. "We cannot go on imposing ever-more punitive tax burdens on this industry without very negative social and economic consequences," Mr Walsh said.

Moving to a per-plane APD in the UK would be a massive drag on the competitiveness of Heathrow as a hub airport, pushing transfer passengers on to flights which transfer elsewhere in Europe. "Our concern is that it puts the UK at a disadvantage compared with other European hubs," Mr Walsh said. "We don't need the APD to encourage us to fill our aircraft. We have quite enough incentives to do that anyway."

He also stressed that while the company supports the inclusion of aviation in the EU ETS, unless it is imposed on all global airlines, it will give non-European carriers, particularly those from the Middle East, a major advantage. Unlike last year's AGM, there were no live lemmings to highlight management's suicidal plans at yesterday's meeting. But, in the aftermath of waves of cabin-crew strikes, there was outspoken criticism from several shareholders, several of them also cabin staff. BA's management was accused of presiding over a bullying culture, and criticism of directors' remuneration was met with loud cheers.

Both Mr Walsh and BA's chairman, Martin Broughton, denied charges of bullying, repeatedly stressing the absolute necessity of cutting the airline's costs to bring them in line with competitors' costs. BA's cabin crew costs stand at twice those of Emirates, Mr Walsh said. He also repeated several times that only a minority of BA staff supported the industrial action.

The 11,000 BA cabin staff who are members of the Unite trade union are being balloted over the most recent compromise package from the company. Unite yesterday called for support from shareholders for the reinstatement of travel perks withdrawn from striking crew members this year.