The hon. Gentleman is right: I have been extremely well briefed by some excellent civil servants, who have had to play catch-up, because I am a Johnny-come-lately to this debate as a result of the events of 4 September this year. I confirm that this duty will apply not just to Heathrow, but also to the other regulated airports of Gatwick and Stansted. I hope that reassures him.
A regulated airport should not be required to spend on environmental measures where a competitive airport would not do so, because that could create market distortions by placing greater burdens on regulated airports than non-regulated airports. Furthermore, not only have the Government sought to address these concerns through their own amendments, but on Report in another place Opposition amendments to the proposed Government amendments strengthening the wording of this duty were also accepted. I hope the House will recognise that as a genuine effort to reach an agreed position on including appropriate environmental considerations in the Bill. We are confident that we have struck the right balance on the environment, and that the CAA will be better placed than ever before to take environmental matters seriously.
On CAA efficiency, we agree with industry stakeholders that it is important to hold the CAA to account. There are a number of provisions in existing legislation that
require the CAA to carry out its activities efficiently. Lords amendment 22 inserts a new clause that will provide for greater transparency and accountability in the CAA’s efficiency measures. Section 21(3) of the Civil Aviation Act 1982 already requires the Secretary of State to lay before each House of Parliament a copy of the CAA’s annual report on its performance and its functions in that accounting year. If Lords amendment 22 is accepted, in future this annual report laid in each House will include an efficiency statement by the CAA and an assessment by the independent auditors of that efficiency statement. The provisions will give the CAA a further incentive to secure value for money and to be as efficient as possible in performing its functions. I am pleased to say that the amendment was welcomed in the other place, where the Opposition commended it, saying:
“This is an excellent proposal, which will guarantee that the efficiency of the CAA will be subject to scrutiny”.—[Official Report, House of Lords, 7 November 2012; Vol. 740, c. 1062.]
I hope that the new clause will enjoy a similar level of support in this House.
Lords amendments 17 to 20 provide the Secretary of State with further powers to close down potential ways around the ATOL scheme. The Secretary of State already has the power to regulate businesses that make available flight accommodation and, under clause 94 of the Bill as introduced, will have the power to regulate businesses acting as an agent for the consumer. However, after the Bill was introduced, the Government and the CAA found possible loopholes that needed to be addressed in further powers.
The first loophole concerns a potential business model whereby a business argues that it is neither making available flight accommodation nor acting for the consumer but is instead merely facilitating making available flight accommodation. That business could then argue that it is not in the scope of either the existing ATOL regulation-making power or those in the Bill as introduced. Lords amendments 17 and 18 address that loophole by giving the Secretary of State powers to include businesses that facilitate making available flight accommodation in the ATOL scheme.
Secondly, amendments 19 and 20 give further necessary clarity to the regulation-making power in instances where goods and services sold alongside flights, such as accommodation or car hire, can be protected under the ATOL scheme. By closing potential avoidance approaches, those four amendments will help the Government meet our stated objectives of providing greater clarity for consumers about what holidays and flights are included in the ATOL scheme as well as a more consistent regulatory framework for businesses.
I have dealt with the main substantive issues covered by the Lords amendments. The remaining amendments, as I alluded to, are the majority and are technical and drafting amendments that clarify issues so that there is no shadow of a doubt about the Bill’s intentions.