Blair puts forward proposal to resolve 'open skies' dispute

Tony Blair has put forward a plan to resolve the impasse between the UK and Brussels over the proposed liberalisation of transatlantic air services, the Irish Prime Minister Bertie Ahern said.

He added that Mr Blair had indicated his "strong willingness" to reach agreement on an "open skies" deal between the EU and US but indicated that a deal was unlikely to be concluded at the meeting of EU transport ministers in a fortnight.

Downing Street declined to comment on the proposals put forward by the Prime Minister, although they are believed to hinge on the role of Heathrow, which would be opened up to any transatlantic carrier under the draft aviation agreement signed a week ago by EU and US negotiators.

Speaking on the fringes of an EU summit in Brussels yesterday, Mr Ahern said Mr Blair believed the open skies proposal to be a "one-sided deal and not delivering for Heathrow". He added: "I would expect him to fight for Heathrow."

Jacques Barrot, the European Transport Commissioner, has urged member states to adopt the draft agreement at the ministerial meeting on 22 and 23 March. The UK Government, along with British Airways and Virgin Atlantic, is opposed to the deal on the grounds that it gives too much away to the Americans. But BMI, the second-biggest slot holder at Heathrow, is urging support for the agreement.

BA and Virgin, with United Airlines and American Airlines, are the only four carriers allowed to operate transatlantic services from Heathrow. If the open skies deal as proposed goes through, any European or American airline would be able to operate to the US from Heathrow.

Details of Mr Blair's proposals may become clearer next week when Douglas Alexander, the Secretary of State for Transport, appears before the Commons Transport Select Committee.

Britain has the power to veto any EU-US open skies deal because it is an international treaty requiring the approval of all member states. But it appears to be isolated in its opposition among the 26 EU members.