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The aviation industry claims the contribution of flying to global CO2 emissions will rise to 5 per cent by 2050. Critics claim the true figure will be much higher

The aviation industry's failure to curb its soaring carbon emissions could lead to the "worst case scenario" for climate change, as envisaged by the United Nations.

An unpublished study by the world's leading experts has revealed that airlines are pumping 20 per cent more carbon dioxide into the atmosphere than estimates suggest, with total emissions set to reach between 1.2 billion and 1.5 billion tonnes annually by 2025.

The report, by four government-funded research bodies, is one of the most authoritative estimates of the growth of pollutants produced by the industry. It was presented to a conference co-organised by the United States' Federal Aviation Authority but not given a wider audience.

Combining data produced by the leading emissions-modelling laboratories in the US, Britain and France, the study found that the number of people seriously affected by aircraft noise will rise from 24 million in 2000 to 30.3 million by 2025, despite the introduction of quieter jets, and that the amount of nitrogen oxides around airports, produced by aircraft engines, will rise from 2.5 million tonnes in 2000 to 6.1 million tonnes in 2025.

Jeff Gazzard, a spokesman for the Aviation Environment Federation, the group that uncovered the report, said: "Growth of CO2 emissions on this scale will comfortably outstrip any gains made by improved technology and ensure aviation is an even larger contributor to global warming by 2025 than previously thought. Governments must take action to put a cap on air transport's unrestrained growth."

The report, Trends in Global Noise and Emissions From Commercial Aviation for 2000 through 2025, was presented last year to the USA/Europe Air Traffic Management Seminar in Barcelona but withheld from wider publication.

Its authors at the US Department of Transport, the European air traffic management body, Eurocontrol, Manchester Metropolitan University and the technology company QinetiQ predict that CO2 will rise from its current level of 670 million tonnes to up to 1.48 billion tonnes by 2025. This exceeds the previous estimate, made in 2004, of 1.03 billion tonnes by 2025. The growth in aviation CO2 means that the highest forecast for aviation emissions produced by the International Panel on Climate Change will be met or exceeded.

The aviation industry, which is exempt from the Kyoto protocol on reducing greenhouse gases, claims the introduction of new technology over the next 25 years means that the contribution of flying to global CO2 emissions will rise from 2 per cent of the total to 5 per cent by 2050. Critics claim the true figure will be much higher because it does not include the CO2 reductions being made elsewhere.

The International Air Transport Association, which represents 240 airlines, said it was working towards producing binding targets to reduce CO2 emissions. "With fuel costs doubling in the last year, airlines already have an incentive to work towards greater efficiency," a spokesman said. "There has been a 70 per cent improvement in fuel efficiency in the last four decades. Aviation is a benchmark of environmental responsibility for others to follow."

UK carbon emissions

Total: 556.2 million tonnes

*Power generation: 220.8m
*Transport (including aviation): 133.5m
*Transport (not including aviation): 96m
*Business: 91.9m
*Residential: 81.3m
*Aviation: 37.5m
*Industry: 13.9m
*Public sector: 10.5m
*Agriculture: 4.3m

Figures for 2006, Defra

The European parliament's rapporteur on plans to include the aviation sector in the EU's carbon trading scheme is facing more opposition than expected to his proposed second-reading amendments to the law.

In an environment committee debate on Monday, German centre-right MEP Peter Liese received broad support from "shadow" rapporteurs from the assembly's main political groups, but also considerable lists of "details" to be worked out.

"I sometimes got the impression colleagues didn't quite remember how they voted at first reading," Mr Liese said. He is proposing to re-table all main first-reading amendments adopted by the parliament a year ago.

Dissent centred on a proposal to ring-fence revenues from auctioning carbon allowances. A new demand for airlines to cut emissions by 1.5 per cent annually from 2013-20 and criteria for derogations were also contentious.

Fellow centre-right MEP Caroline Jackson said ministers would never accept ring-fencing and that pursuing it was "pointless". She urged the rapporteur to carry out an impact assessment to analyse the cost of his proposals.

Finnish MEP Eija-Riita Korhola, also of the EPP, and Liberal shadow rapporteur Holger Krahmer said auction revenues should be dedicated to the aviation sector. They also suggested MEPs should speed up a second-reading agreement by dropping their demand for a nitrogen oxide (NOx) multiplier.

Several MEPs, including Socialist shadow rapporteur Matthias Groote, disapproved of Mr Liese's proposal to demand that airlines cut emissions by 1.5 per cent annually from 2013-20. Mr Groote wants to insert the 1.74 annual cut implied in the commission's emission trading review.

Mr Groote did support Mr Liese's proposed trading introduction date, auctioning plans and NOx multiplier. Green MEP Caroline Lucas was one of several to support a proposed efficiency "gateway" clause.

Rooting about for Mediterranean holiday possibilities on the Expedia website recently, I came across a flight for £300. About half of that was the fare; the rest was labelled "taxes and fees". I do not regard taxation as theft and I accept that air travellers should pay for the environmental damage they cause. Still, a 100 per cent tax rate did seem steep.

I carried on clicking and discovered I was getting off lightly. On the British Airways site, I investigated what tax I would pay if I were setting out this morning from London's Heathrow to New York's JFK. When I looked, an economy flight leaving this Tuesday and returning on Tuesday next week was selling for £296.40 ($583). The fare accounted for just £80 - which suggested a ticket tax of 270 per cent.

I asked BA to explain how this excess was calculated. It turned out that only £55.40 was straightforward taxation: £40 in UK air passenger duty and £15.40 in US arrival and departure taxes. There was also a US customs user fee. As passengers cannot say they would actually prefer not to use customs, I suppose this counts as a tax too, as does the US "immigration user fee". But there are also airport passenger charges (far higher at Heathrow than at JFK) and security charges. Biggest of all was a £126 fuel surcharge, which is not a tax at all.

Airlines object when governments load extra charges on to their tickets. They do not help themselves by making the tax component of their fares so opaque. But governments are to blame too: they should have come up with a uniform taxation system for this most international of industries rather than the existing hodgepodge of national charges.

The most obvious tax would be on aviation fuel. The problem is that tax on fuel for international flights is outlawed by the Chicago Convention, international aviation's Magna Carta.

Most countries do not impose value added tax on international flights, which means the industry was for years undertaxed. The UK government set out to remedy this and has since become an enthusiastic taxer of air travel. As 20 per cent of international flights begin or end in the UK, the most important airlines have all been dragged into the net.

When the Conservative administration introduced air passenger duty in 1994, it did not pretend it was anything other than a way to fill government coffers. There was no mention of the environment.

As air passenger duty has climbed (it is now £80 on a business class flight to a non-European destination), the government has increasingly described it as a green tax, there to ensure the industry covers its environmental costs.

The airlines insist they more than cover them, which sounds fanciful, given that flying's depredations extend beyond carbon dioxide emissions to noise and traffic congestion around airports. But a recent study by the independent Institute for Fiscal Studies says that, although the external costs of aviation are uncertain, studies indicate the airlines' claim is broadly true.

Low-cost carriers such as EasyJet have objected that the duty does not focus on the real environmental offenders as it does not distinguish between flights on fuel-efficient aircraft and wasteful ones. Because all non-European destinations are subject to the same duty, passengers flying to New Zealand also pay no more than those travelling to Morocco.

The government has agreed that, from next year, taxes will be imposed per aircraft rather than per passenger. Its recent tax changes have been fiascos. Fortunately, it has asked for comments on this one as it looks like being a fiasco too.

The government says its favoured method of assessing the tax will be an aircraft's weight at take-off combined with the distance travelled. As many in the industry have pointed out, this will provide no incentive to use more efficient aircraft. It will also encourage airlines to use smaller aircraft, when the best environmental outcome would be to reduce the number of flights by using larger ones.

There is also the practical problem of how airlines will pass this tax on to customers. At present, each customer who flies pays duty. What would happen under the proposed system if the family in row 35 failed to show up and the airline found itself short of the money to pay the per-aircraft fee? Would the cabin crew organise a whip-round among the other passengers?

The European Union is proposing a different approach: capping airline emissions at the average level of 2004 to 2006 and issuing emission permits to carriers. A small proportion of permits would also be auctioned. Any airline that wanted to exceed its level would have to buy additional permits. This would force the industry to innovate to keep emissions down.

The problem is that the rest of the world does not want an airline emissions trading system. Given how chaotic and dysfunctional the existing airline tax systems are, the rest of the world should come up with a better idea if it can.

After months of damaging retreat, many airline share prices have gained in recent days as the crude oil price fell back from its latest peak on Monday.

Speculation about industry consolidation - particularly in the US, where Delta Air Lines and Northwest Airlines are seeking to merge - has also helped some airline stocks to bounce back. But the respite could prove temporary.

"We're having a fool's rally," a leading aviation analyst said yesterday. "This is a rally associated with the oil price coming down from $117 to $110 a barrel. But with $110 oil airlines are still in very grave difficulties."

The oil price rose again yesterday as Turkish fighter aircraft attacked Kurdish positions in northern Iraq.

British Airways' share price rallied this week. A rise of about 12 per cent was supported by its disclosure that it was exploring "opportunities for co-operation" with American Airlines and Continental Airlines. But the recovery was small measured against the fall during the past 12 months of more than 50 per cent.

More important influences on the outlook for aviation are the oil price and growing economic weakness round the world. Jet fuel has overtaken labour as the biggest single cost and accounts for 30 to 40 per cent of carriers' total expenses. And there are fears of outright recession in the US.

Chris Avery, European aviation analyst at JPMorgan, said that, for BA, the "enormity" of the industry fuel price rise and recession meant that any eventual gains from an enhanced transatlantic alliance were "pretty small beer".

In recent months the mood has darkened and many US carriers and some in Europe reported losses in the first quarter. Profit warnings have become commonplace, and there have been several airline bankruptcies.

The latest data for global airline traffic, released yesterday by the International Air Transport Association, added to the gloom by showing an underlying rise in passenger traffic of 4 per cent year on year.

Iata said the slowdown in demand growth continued a sharp downward trend that began in December 2007 when the US credit crunch started to be felt in the airline industry.

"Traffic only tells a part of the story," said Giovanni Bisignani, Iata director-general. "Astronomical oil prices are hitting hard. And the buffer of an expanding economy has disappeared. The fortunes of the industry have taken a major turn for the worse."

For many US network carriers, such as American, United, Northwest and Delta, fuel cost problems are compounded by the large number of older, less fuel efficient aircraft they are still operating.

Airlines have tried to claw back some of the higher fuel costs through fuel surcharges and fare increases, although they are starting to meet consumer resistance to higher prices.

Carriers are taking out hedging contracts for part of their future fuel requirements. Air France-KLM, Lufthansa and BA are among the most successful practitioners of this kind of insurance.

BA said in March it was 60 per cent hedged for the first half of the current financial year, at about $80 a barrel, and 45 per cent hedged for the second half at $83 a barrel.

"I am sometimes asked, 'How high does the fuel price have to go before you lose your operating profit?' " Keith Williams, BA chief financial officer, said recently.

"Assuming no change in the level of fuel surcharging, I believe at the moment that would be just under $120 a barrel. Long-run fuel prices at those sorts of levels would of course result in pretty fundamental changes to our industry."

Margins are shrinking at frightening speed. Yesterday the June forward contract for Brent crude oil resumed its upward movement, trading $3.70 higher at $114.20 a barrel.

There may be a world of difference between airlines and bus and train operators but that has not stopped National Express from feeling the effects of a downturn in air travel.

In today's first quarter trading update, the FTSE 250 transport group says it has seen a "softening" of demand on its Stansted airport routes - it runs both train and coach services to the terminal - as a result of lower passenger volumes through the airport.

But that is the only weak spot in an otherwise solid statement. UK coach revenues were up 5 per cent, buses up 6 per cent and rail ahead ahead 9 per cent, with the East Coast Main Line - its newest franchise - especially buoyant. Trading in its North American school bus division remains steady, with no sign that US school boards are cutting back on spending.

Perhaps most reassuring, given concerns over the impact of a weakening Spanish economy, National Express says trading in that territory - where it last year bolstered its Alsa operation with the £450 million purchase of Continental Auto - remains on track.

But that did little to revive the shares, which have fallen by a quarter since the start of the year. Fuel prices are a persistent concern, but they account for only 5 per cent of operating costs. Further, as confirmed today, the company is 85 per cent hedged for 2008 and 40 per cent for next year - albeit at an unspecified price.

With bigger bus operations than any of its peers, National Express should also be among the more defensive given the scope for what is fashionably-termed "modal shift": people relinquishing more expensive forms of transport for cheaper ones - from cars to trains, and from trains to coaches.

Yet at less than nine times next year's earnings, it remains the cheapest stock in its sector. Even more persuasively, the company has pledged to raise its dividend by 10 per cent in each of the next three years - from yesterday's yield of 4.3 per cent.

Tuck away for the long term.

The European Commission yesterday abandoned its long-standing opposition to the trade in take-off and landing slots at congested airports - pioneered at London Heathrow, Europe's busiest airport - and lifted its threat of legal action against the UK government to stop such deals.

"We are recognising for the first time that secondary trading is an acceptable way of allowing slots to be swapped among airlines," Jacques Barrot, European transport commissioner, said. He praised the Heathrow scheme as a model.

"This system has already shown its value in London, where it has allowed a range of airlines to take advantage of the opportunities provided by the EU-US aviation agreement and to create new levels of competition," he said.

Mr Barrot's staff emphasised that trading, for money or any other asset, must be transparent and fair. "At crowded airports, we need to make sure slots are used as efficiently as possible and that airlines have a fair chance to develop their operations," Mr Barrot said.

New entrants should now be eligible for half of new or unused slots each year. The Commission proposal requires a "co-ordinator" to create a pool for such slots and to allocate them, with the first 50 per cent going to new applicants. The regulations retain "use-it-or-lose-it" provisions designed to prevent carriers from blocking rivals or wasting precious airport capacity.

The Association of European Airlines, which represents scheduled carriers, welcomed the proposal. "We have always maintained that the problem is lack of capacity rather than the way slots are traded," it said.

Slots at Heathrow, the leading gateway airport in Europe for US travellers, have been traded for years. The practice has been backed by the UK government ever since it was supported in an action in the High Court in the late 1990s. Slot trading has been a vital mechanism at Heathrow to maximise efficiency. The airport is at full capacity nearly all day and there are virtually no free slots.

The price of Heathrow slots has more than doubled in two years, partly in response to a surge in demand from US airlines seeking to exploit the US-EU "open skies" treaty that came into force in March.

Several US carriers have been able to start services to Heathrow and Continental Airlines recently disclosed it had paid $209m (£105m, €134m) for four pairs of slots to start services from New York Newark and Houston.

ROCKETING fuel prices will bring an end to the era of cheap family holidays, experts warned yesterday. Airlines offering long and short haul holidays are pushing up prices to pay the escalating cost of fuel.

British Airways yesterday announced new fuel surcharges and budget companies Ryanair and easyJet have both issued warnings of reduced profits with oil prices driven high around the world.

Several budget airlines have already gone bust, including three in America, and those fighting to stay in business are passing on higher costs to passengers.

Compounding the problems for the travel industry is the strength of the euro against the pound which is raising the prospect of holiday surcharges. In the past nine months the pound has fallen 17 per cent to 1.22 euros, adding to the misery. Oil prices have risen due to several factors including soaring demand in China and India and instability in Nigeria.

Liberal Democrat Transport spokesman Norman Baker said yesterday: "The days of cheap of flights and cheap holidays are numbered. There is only one way the price of oil is going and that is up."

Aviation expert John Strickland of JLS Consulting said low-cost airlines would try to keep fares as low as possible, but would push harder to increase add-on revenues.

From Monday Europe‚s biggest budget airline Ryanair will raise the cost of putting a bag in the hold from £12 to £16 and for using a check-in desk to £6 to £8 for return flights. It is also planning 40 job cuts at its Dublin call centre. For families forced by higher prices to holiday at home, the outlook is not must better with analysts at uSwitch.com revealing the widening effect of the fuel crisis.

It forecast that unleaded petrol will cost £1.50 a litre - or £6.75 a gallon - within months. Across the UK, the total fuel bill will hit £81 billion from which the Treasury will take £51 billion.

There were the first signs of a growing revolt yesterday with a petition launched on the Downing Street website calling for a cut in fuel duty. Hauliers also took to the streets of London to protest at escalating diesel prices and tax.

BA yesterday had to deny rumours that it was preparing to issue a second profits warning. It stood by its March forecast of a profit margin of seven per cent for 2008-09 based on an average fuel price of $85 a barrel. But BA - like most airlines - buys its oil in advance to find the best prices. Even so, last month it forecast a £450million increase in its fuel bill to £2.5billion. Fuel accounts for a quarter of airline budgets and the cost of fuelling a transatlantic flight has risen to £22,100.

The new fuel surcharges announced yesterday will come into effect on Friday, adding an extra £6 for return short-haul flights, making the total surcharge £26 return.

Long-haul flights of nine hours or less face an extra surcharge of £20 return, taking the total to £126 return. Long-haul flights of more than nine hours will have an extra surcharge of £30 return, taking the total surcharge for a return flight to £158. A family of four will pay £104 return in fuel surcharges for short-haul, £504 return for a medium-range long-haul flight and £632 for the longest long-haul flights.

Last night Ryanair admitted that planned job cuts were linked to several factors including oil prices but insisted that its increased charges for luggage are designed to "influence passenger behaviour" and ruled out an end to cheap flights.

A spokesman for Abta played down fears of an end to cheap holidays, claiming modern planes are much more fuel efficient. He said: "If fuel prices stay at this level, prices are going to rise but the cost of flights today are near enough the lowest they have ever been historically."

The green lobby is also monitoring the current oil crisis. Tony Bosworth, Friends of the Earth Transport Campaigner, said: "The aviation industry is one of the fastest-growing sources of carbon dioxide emissions. Rising fuel prices are likely to make air travel more expensive. The Government must do more to make greener travel options, such as long-distance rail travel, cheaper and easier to use."

British travellers already thinking twice about flying to Europe this summer as the falling value of the pound cuts into their travel budget received more bad news yesterday with indications that the era of cheap flights may be drawing to an end.

Soaring fuel costs have put airlines under financial pressure which, analysts say, will inevitably be passed on to passengers through increased ticket prices, fuel surcharges and baggage check-in fees. The warnings follow a wave of airline bankruptcies in the UK and the US, and crippling oil price rises which have seen the cost of fuelling a transatlantic flight quadruple since 2000 to $44,000 (£22,100). The pressure on the airlines has been most acute this year as the global oil price rose from $80 a barrel to nearly $120.

Ryanair became the latest airline to pass that pain on to customers yesterday when it raised the cost of putting bags in the hold and checking in at airports. Passengers on Europe's largest budget carrier will have to pay £16 a bag and £8 to use a check-in desk on return journeys from Monday.

Fuel accounts for a quarter of airline budgets and the resulting financial squeeze has triggered warnings that major carriers could go to the wall or be forced to merge with rivals to survive.

For Britons holidaying in Europe this summer, the extra cost of flying comes on top of a slump in the pound against the euro. The pound has fallen by 17% since last summer - from €1.47 to €1.22 last week.

Some reports suggest that tour operators are also moving to levy extra charges on holidays to recoup losses caused by the fall in the pound. At least 19 operators have applied to the Association of British Travel Agents to add a charge of up to 10% to holidays already booked. Late-notice fees can be added as long as they are imposed more than 30 days before departure.

Yesterday Ryanair attempted to play down its latest charge increases, the second time it has raised baggage costs this year, as part of an ongoing drive against luggage. But analysts say the airline has hiked up such charges to cover the rising cost of fuel, which is expected to account for nearly half its costs next year.

"Their earnings are very adversely affected by the fuel price, so they need to do everything they possibly can to alleviate that cost pressure," said Andrew Lobbenberg, an analyst at ABN Amro. Long-haul carriers such as British Airways levy fuel surcharges to cover rising fuel costs, but low-cost airlines refuse to impose them, instead preferring to recoup costs through add-on charges for checking in, in-flight food and car rental deals.

Ryanair said its charges hike would help keep fares low by making airplanes lighter, resulting in less fuel being consumed, and lowering baggage handling costs. But industry experts said higher bag check-in costs are inevitable if the cost of oil stays around its current level.

John Strickland, an aviation consultant, said: "Budget airlines will push harder and harder to increase add-on revenues. There is all the more impetus to do it in a toughening oil price environment."

Ryanair and low-cost rival easyJet will try to leave fares untouched, because cheap tickets are the key part of a no-frills business model that uses bargain fares to pack passengers on to airplanes and then wring profits from them with add-ons.

"They cannot afford to raise fares. It would break their model," said Strickland. "Occupancy would fall and they will not make enough money to cover increased fuel costs." Ryanair has already warned that profits could fall by as much as 50% this year due to the fuel situation, while easyJet shares were hit recently when it said it would miss its full-year profit targets if fuel stayed at the current price.

The Ryanair hike came as another airline serving the UK market went bust over the weekend. Eos, carrying business passengers between London and New York, slipped into bankruptcy. High fuel costs and depressed economies in Europe and the US have caused airline bankruptcies on both sides of the Atlantic in 2008, including three budget carriers in the US since March.

The threat to the industry is at its most serious since the aftermath of September 11, analysts have warned. The global airline industry is barely profitable, with a return on sales of around 1%. Just 13 airlines in the world recorded a profit margin of more than 10% last year, including Ryanair and easyJet, when the average oil price hovered below $80 a barrel.

Analysts say BA's profits will be nearly wiped out if oil stays around the $120 mark over the next year. BA has admitted its fuel bill will rise to £2.5bn this year, forcing it to warn of lower than expected profits.

Extra costs per return journey

EasyJet
Bag check-in £10
Priority boarding pass £10 - £15

Ryanair
Bag check-in £16
Priority boarding £8
Check in for musical instrument or sports equipment £50

Flybe
Bag check-in £9.98
Pre-assigned seating £10
Check in for sports equipment £40

The Government has torpedoed secret attempts by BAA, the owner of Heathrow and Gatwick airports, to hand a lucrative directorship to Sir David Rowlands, a former civil servant who played a key role in directing national airport policy. While at the DfT, Sir David Rowlands was a central figure in Britain's aviation policy

The Sunday Telegraph has learned that BAA offered Rowlands, who spent four years as the permanent secretary of the Department for Transport before retiring last May, a role as a non-executive director several weeks ago. His remit was to have been to provide counsel on BAA's regulatory landscape and to act as a bridgehead between the company and Whitehall.

Downing Street sources said last night that Rowlands had accepted the post in principle before the Advisory Committee on Business Appointments - loosely affiliated to the Cabinet Office - recommended against the move because of its political sensitivity.

The decision underlines the Government's nervousness about the rapid transfer of senior officials from Whitehall posts into potentially lucrative private sector employment.

According to a list released under the Freedom of Information Act detailing meetings between Whitehall officials and companies such as BAA, British Airways and Virgin Atlantic, Rowlands held more than a dozen meetings with BAA during his stint at the DfT.

Last week, the Competition Commission gave a clear signal it expects to order a partial break-up of BAA by forcing the company to dispose of one or more of its major airports. Such a move would represent the biggest shake-up of airport ownership for decades.

Ruth Kelly, the Transport Secretary, announced last week a separate review of airport regulation, which will focus on the role of the Civil Aviation Authority.

During a 24-year career at the DfT, Rowlands was a central figure in Britain's aviation policy, overseeing proposals for a third runway at Heathrow and the delivery of a public-private partnership for air traffic control services.

A separate list produced by the Government's Advisory Committee on Business Appointments shows that Rowlands has taken on two other roles since retiring from the Civil Service.

He is a member of an advisory panel at Xansa, the outsourcing and technology specialist. He has also been chairing a review of roads policy for Essex County Council.

The restrictions on Rowlands' role at Xansa state that his appointment was approved "subject to the condition that, for 12 months from his last day of service [in May 2007], he should not become personally involved in lobbying UK Government Ministers or officials on behalf of his new employer".

Rowlands could not be reached for comment last night.

BAA declined to comment, while a spokeswoman for the Advisory Committee on Business Appointments refused to comment on Rowlands' case, but said: "Any application or advice would remain confidential until such time as an appointment was taken up or an announcement was made".

As Christopher Clarke strode into the Competition Commission's briefing room, he knew what the members of the press were thinking. Advisers who two weeks earlier had read a draft of the "emerging thinking" report, on BAA's airport domination in Scotland and the south-east of England, had warned Clarke, the inquiry's chairman, that the findings would be seen as a break-up call.

Following the publication of the report last Tuesday, Clarke had toured television studios that morning, explaining that the report did not represent the definitive view of the inquiry, which would be given in August. To the hacks, however, a relaxed Clarke repeated the earlier words of the Competition Commission's press officer: "This is about as far as we have ever gone at this stage."

With phrases like "common ownership adversely affects competition" scattered through the report, the sell-off of at least some of BAA's seven airports now has an air of inevitability.

But what this ignores is that nearly everything is going to plan for Ferrovial, the Spanish conglomerate that bought BAA for £10.6bn in 2006 in a heavily bankrolled deal. "What people don't realise," smiles a former executive at BAA, "is that Ferrovial is going to end up getting one of the greatest steals in corporate raiding history."

Ferrovial's need to refinance the massive debt it took on to buy BAA is well known. But more to the point, says the insider, is that the capacity constraints at Heathrow, Stansted and Gatwick meant Ferrovial was always prepared to sell parts of the portfolio. "It did due diligence, so this situation came as no surprise."

A second source adds that while Macquarie, the Australian investment bank, has been reported as advising on refinancing BAA's unregulated airports - Glasgow, Edinburgh, Aberdeen and Southampton - it has also been valuing chunks of the portfolio. The source concludes that Ferrovial is gearing up for a sale.

The Spanish group has already sold 33 properties and its World Duty Free retail chain for a total of more than £800m. A further property sale that is under negotiation should bring in £700m. Gatwick could fetch £3bn and "if they get dead lucky", says the first source, Ferrovial might also be able to sell Stansted. All that could total £6bn, which would mean the Spaniards end up spending a net sum of well under £5bn.

Heathrow, meanwhile, has fixed assets worth £8bn - hence the description as one of the great corporate raids. A senior City transport banker agrees: "Heathrow is the important thing here - nothing else is critical to Ferrovial."

But disposals will bring difficulties (see the airport boxes). If the Competition Commission recommends selling Gatwick, it could well be demanding that Ferrovial sell at a time when the market has not recovered, leading to low bids. Then there are concerns over the regulatory burdens at Heathrow and Gatwick, which mean the owners cannot fix charges to airlines as high as they'd like.

"This is all high risk," says the former BAA executive. "And there's an awful lot more complexity than Ferrovial bargained for. You're talking weeks, months and years for all this to play out."

Gatwick - Bidders could be grounded
This is the airport that has provoked the most speculation on bids.

Although sale price estimates fluctuate from £3bn to £5bn, two candidates may be in difficult positions. Macquarie is already acting as an adviser to BAA, so faces conflict of interest concerns. Fraport, the German transport company, owns Frankfurt airport, which could be seen as a rival to Gatwick due to its size and proximity to a major financial centre, meaning Brussels might veto a deal on competition grounds.

There are also fears that interested parties could be put off by Gatwick's status as a "designated" airport. To ensure BAA did not have a stranglehold on its sites, various systems and services, have been outsourced. This makes any purchase less attractive, and is also the reason why baggage handling at Heathrow's T5 is not done by BAA.

Edinburgh, Glasgow, Aberdeen Sales head for take-off
Accounting for 84 per cent of passengers north of the border, BAA disposals in Scotland are likely to be recommended when the inquiry releases its findings. It is thought bid teams are being put together for Glasgow and Aberdeen, which would be Ferrovial's favoured sales.

Unlike the London airports, these Scottish assets are unregulated, making them far easier for bidders to price. As charges are not reviewed every five years, there is also greater certainty, allowing bidders to raise relatively cheap long-term debt to buy and develop the airports. One source believes that, as a result, sales in Scotland will be completed before Gatwick.

But buyers may not be able to hike charges to carriers as there is not the same level of demand as in London.

Southampton - Ripe for redevelopment
With the spotlight on the London giants, a possible sale of Southampton airport is often overlooked. But Ian Tyler, the chief executive of Balfour Beatty, the construction group with a 60 per cent stake in Exeter airport, has admitted an interest and there is sufficient development potential to attract more bidders.

Clarke attacked BAA's management of Southampton, citing a "lack of ambition". In 2003, the Government suggested the airport could accommodate seven million passengers a year, but BAA said 2.5 million was more realistic.

Flybe, Southampton's main carrier, was critical of BAA's capital expenditure plans and the commission report endorsed that view: "BAA had not developed Southampton, despite constraints at its London airports, as it did not understand how to develop a regional airport."

Heathrow BAA seeks room for manoeuvre
The prize asset. In return for not putting up a fight against the sale of other airports, an aviation source believes Ferrovial will push the Government to lift the Civil Aviation Authority's regulatory powers over charges to airlines using Heathrow.

In the recent five year settlement, BAA was granted a charge far less than it argued was necessary to help fund investment. "Heathrow is already one of the cheapest international airports in all of Europe," says the source. "Ferrovial could raise prices by 50 per cent tomorrow without really affecting demand."

One banker points out that the regulatory burden has been so heavy that "it doesn't allow the necessary capital expenditure to ever catch up" with the needs of Heathrow.

Stansted - Stand by for a forced sale as carriers cut up rough
A harder sell than Gatwick, the Competition Commission was also damning of BAA's management here: "At Stansted there has been no constructive engagement on capital expenditure... and the airlines object strongly to BAA's proposed development and lack of consultation."

Ryanair and easyJet, which account for 80 per cent of the airport's passengers, have said plans for a new runway and terminal don't meet their needs. They told the inquiry they would have "little option" but to use different airports.

Clarke noted a "lack of responsiveness to carriers' needs" and said he would look further at easyJet and Ryanair's complaints. A forced sale, then, looks increasingly likely.

The government has decided to sacrifice air quality standards across London in order to allow an extra 60,000 flights per year into Heathrow. Ministers are planning to ask the European commission for a special deal to exempt the capital from official limits on exposure to air pollutants.

MPs representing constituencies under the Heathrow flight path accused the government of "an enormous betrayal" for allegedly breaking a promise to block Heathrow expansion unless air quality standards were met.

John McDonnell, Labour MP for Hayes and Harlington, said the government's decision, disclosed in a document obtained by The Sunday Times, was also "a disgraceful act of bad faith". He added: "Ministers must have been on their feet about 20 times where they said there will be no expansion of Heathrow unless they can meet the air pollution limits."

He said next week he and other MPs would demand that ministers should explain themselves in the Commons.

Exposure to nitrogen dioxide (NO2 to respiratory problems and premature death in vulnerable people.

Plans to allow flights to land and take off on the same runway at Heathrow as early as 2010 could lead to an extra 60,000 flights per year. The extra passenger volumes will also generate additional traffic to and from the airport. A third runway would generate a further increase in flight numbers and emissions.

Susan Kramer, Liberal Democrat MP for Richmond Park which lies under the Heathrow flight path, said: "Poor air quality hurts our health but it's the issue that the government never wants to talk about when it comes to Heathrow. Now we know why: they have a dirty little secret."

The European Union air quality directive, which comes into force next month, would require the UK to meet limits on NO2 by 2010, in line with World Health Organisation standards.

The government's plans to secure a waiver from the rules was disclosed in a presentation given to a conference on air quality earlier this month by an official at the Department for Environment, Food and Rural Affairs. The civil servant from the department's air quality unit disclosed that the government is drawing up plans to ask Brussels for formal permission to delay compliance with Europe-wide air quality rules.

An environment department spokesman confirmed that the government was expected to apply for a five-year exemption for NO2 emissions and a year for particulates of less than 10 microns in size.

OUR COMMENT: What a disgrace for the country that pioneered the first National Health Service! Hopefully the EU will insist on maintaining higher standards for its citizens.

Pat Dale

AN AMERICAN premium airline operating out of Stansted Airport has filed for bankruptcy, cancelling all further flights and leaving passengers with an anxious wait for refunds.

Eos Airlines, which had flown up to four premium flights between the Essex airport to New York each day, filed for bankruptcy on Saturday, saying it had "insufficient cash" to continue after failing to secure investment.

The airline operated some flights from Stansted yesterday but they were the last and customers who have already purchased tickets will have to seek a refund from their credit card company. A statement issued on the Eos website said it would immediately implement a "eduction in its workforce" and "eliminate" the positions of most of its employees.

Jack Williams, Eos' CEO, said: "After overcoming today's extremely challenging economic and credit environment to negotiate terms for a round of financing, it is regrettable that we were forced to take this action. Unfortunately, just as we were working toward closing on an investment that would have carried us to corporate profitability in 2009, some issues arose that we could not overcome."

He said it was "regrettable" that it was unable to close on the financing needed, leaving it with "insufficient cash" to continue operations. Mr Williams added: "I want to express my appreciation to our dedicated employees and to the many guests who have become like family to us."

A spokesman for BAA Stansted, which runs the airport, said it was "disappointing news" and referred customers to the Eos website for more information.

Launched two years ago, the airline used Boeing 757 planes with 48 seats that reclined into beds but many flights were reported to be significantly below capacity.

Business seemed good just 18 months ago in September 2006 when the airline doubled its daily service, which offered a standard return ticket at the time costing £2,750. However the airline is just one of a number of smaller operators in America hit hard by rising fuel prices, economic pressures and falling demand.

Brian Ross, economics adviser for campaign group Stop Stansted Expansion, said the news was a blow to BAA's hopes for developing long haul and business services at Stansted and reducing its dependence upon short-haul leisure flights. SSE had long been critical of Eos and fellow all-business operator Maxjet, which went out of action in December, for environmental reasons.

The group's research showed that each Eos passenger produced the equivalent of nine tonnes of carbon dioxide on a return trip to New York - more than three times as much as a passenger travelling on a scheduled flight with a conventional airline.

Mr Ross said: "Clearly no-one can be happy about the job losses and unpaid bills which will arise from the demise of these two US airlines but when aviation is already the fastest growing cause of climate change it is unacceptable to have such profligate operations."

The Civil Aviation Authority (CAA) has today issued its formal, mandatory reference of the Stansted Airport price control to the Competition Commission and has set out a number of options for the price control design.

The choice between these options depends upon the extent of competition now and in future – which could be affected by the Competition Commission’s own market inquiry into BAA’s airports – and establishing which is best suited to delivering investment in the right facilities at the right time.

Getting the design and level of the price cap right is important as it affects the prices paid by airport users, the service quality received by passengers and the investment that the airport could undertake. Further, as Stansted competes for passengers and airline services, the price cap could also affect price, service and investment at other UK airports and the evolution of competition in the airports market.

The price cap options identified by the CAA and in consultation responses vary in the extent to which they:

* Rely on competition – and associated commercial negotiation between the airport and its airline customers – to constrain pricing and protect the interests of airport users;
* Base the price cap on historic costs derived from the airport’s past operation and regulation rather than the prices that an operator would normally charge to pay for necessary and efficient investment; and/or
* Protect the commercial interests of airlines currently operating at the airport.

The CAA has also identified issues around the practical implementation of different options and ways of implementing transitional arrangements, so that any changes are introduced over a period of time.

Speaking today, Dr Harry Bush, the CAA’s Group Director of Economic Regulation, said: "Devising an approach to regulating Stansted is unusually challenging. It needs to take proper account of uncertainties around forecasting of market trends, the scale of the proposed investment and the strongly held – but sharply differing – views of the airport and its principal airline customers. And, importantly, to do so in a way that benefits passengers."

"The extent to which Stansted is – and can be – subject to competitive pressure should inform the design and level of the price cap for Stansted as this will affect pricing and investment at other airports and the prospects for future competition. I look forward to receiving the Commission's views and recommendations on the future regulation of Stansted later in the year."

Following the January consultation document, the CAA has:

* Further refined the price cap options, including a sixth option identified by airlines in their responses to the January consultation, focusing on how these options could be implemented in practice;
* Undertaken initial analysis of Stansted operating costs and commercial revenues, identifying some scope for further airport efficiency improvements;
* Considered the airport's efficiency in undertaking and consulting upon capital investment projects, which suggests that whilst investment in the current price control period was delivered efficiently in terms of timing and cost, there is scope for improved information to airlines, in line with previous CAA analysis; and
* Requested information from BAA to justify the commercial case for its airport expansion plans and from airlines to enable the CAA to understand better the market position of the airport.

The amount of two key greenhouse gases in Earth's atmosphere rose sharply in 2007, and carbon dioxide levels this year are literally off the chart, the U.S. government reported on Wednesday.

In its annual index of greenhouse gas emissions, the U.S. National Oceanic and Atmospheric Administration found atmospheric carbon dioxide, the primary driver of global climate change, rose by 0.6 percent, or 19 billion tonnes last year.

The amount of methane increased by 0.5 percent, or 27 million tonnes, after nearly a decade of little or no change, according preliminary figures to scientists at the government's Earth System Research Laboratory in Colorado.

Methane's greenhouse effect is 25 times more potent than carbon dioxide's, but there is far less of it in the atmosphere. Overall, methane has about half the climate impact of carbon dioxide.

The primary source of carbon dioxide is the burning of fossil fuels, which is increasing, with China now the world's biggest emitter, said Pieter Tans, who studies greenhouse gases at the laboratory. The United States is second.

The greenhouse gas index, based on data from 60 sites around the world, showed that that last year's carbon dioxide increase added 2.4 molecules to every million molecules of air, a measurement known as parts per million, or ppm.

OFF THE CHART

Carbon dioxide levels were about 270 ppm in the mid-18th century, before the wide use of fossil fuels that began with the Industrial Revolution. Last year's levels were near 390 ppm, and they have been rising more steeply over the last three decades, Tans said in a telephone interview.

"The average (annual rise) over the last five or six years has been 2 ppm and that is actually steeper than it has been in previous decades," he said. "This whole decade the rate of increase has accelerated, and we have a very clear candidate (for the cause) and that's emissions from burning fossil fuels."

The rise continued in 2008, according to a chart of global carbon dioxide emissions online here, which showed world emissions of this gas heading off the chart at over 386 ppm.

"It's gloomy," Tans said. "With carbon dioxide emissions, we're on the wrong track, it's obvious. And I'm also fully convinced that we're in actually quite a dangerous situation for climate."

The increase in methane emissions after years of little change may indicate that methane locked for thousands of years in frozen Arctic soil known as permafrost is being emitted into the atmosphere as the soil melts.

"What used to be in the deep freeze is now being taken out in the warming," Tans said.

It is also possible that the 2007 rise in methane emissions is due to some other cause. Methane emissions rose sharply between 1978 and 1998 and then leveled off.

The UK airports market was yesterday plunged into a period of unprecedented upheaval after the anti-trust watchdog attacked the dominant role of BAA, the world's leading airports group.

The Competition Commission's criticism of the company - a subsidiary of Spain's Ferrovial - could pave the way for a break-up of the group's monopoly of the main airports in London and Scotland. Its findings also increase the likelihood BAA will choose to put some of its airports up for sale before it is forced to do so.

Also yesterday, the government took the first step towards a radical overhaul of the current system of airport economic regulation and the setting by the Civil Aviation Authority of the maximum charges that must be paid by airlines at Heathrow, Gatwick and Stansted.

The commission said BAA's common ownership of seven airports in the south-east of England and Scotland "adversely affected" competition. The ownership of the London airports - as well as Southampton and three in Scotland: Glasgow, Edinburgh and Aberdeen - "may not be serving well the interests of either airlines or passengers", it said.

Christopher Clarke, chairman of the commission's inquiry into BAA's airports, said: "We are particularly concerned by its apparent lack of responsiveness to the differing needs of its airline customers, and hence passengers, and the consequences for the levels, quality, scope, location and timing of investment and levels and quality of service."

In an interim report explaining its "emerging thinking" about the structure of the UK airports market, the commission said it planned to publish its provisional findings in August, including possible remedies such as requiring the sale of one or more of BAA's airports, if competition problems were to be identified.

Mr Clarke said the commission had gone a lot further than was usual at this stage in industry enquiries. He admitted it was "very difficult to know" what an airport industry after a BAA break-up would look like, although there were good reasons for thinking a more competitive market would lead to new ideas and potential improvements.

"You get different investment plans, different responses to customers. At the moment we are not seeing a lot of difference," he said. Ian Giles, a competition lawyer at Norton Rose, said: "The market will read this as a sign that BAA is likely to sell off at least Gatwick and one of its Scottish airports. Investment banks are already sounding out potential buyers."

Douglas McNeill, transport analyst at Blue Oar Securities, added: "The break-up of BAA is moving steadily closer, and owner Ferrovial now has about a year to make disposals before the commission forces its hand. That means one of the Scottish airports and one or more of those in England. There will be buyers for these assets - but will they be prepared to match the valuations that were implicit in the high price Ferrovial paid for BAA two years ago?"

The report is yet another serious challenge to the consortium led by the Spanish construction, infrastructure and services group, which acquired BAA less than two years ago for more than £10bn. Ferrovial already struggles to refinance more than £11bn of BAA debt after the highly leveraged takeover in summer 2006.

Financial returns at Heathrow and Gatwick are squeezed by the new five-year price cap regime imposed recently by the CAA. It also faces severe operating challenges at Heathrow, Europe's busiest and most congested airport, especially after the disastrous opening of its £4.3bn Terminal 5.

Colin Matthews, BAA chief executive, said the group remained "of the view that its ownership is in passengers' interests, both in terms of tackling the shorter-term service problems and in following through with major commitments to investment in facilities and capacity".

Airlines welcomed the commission report, with Ryanair and Flybe calling again for BAA's break-up. Ryanair said the monopoly had been "bad for consumers, bad for passengers and damaging [to] UK tourism".

The prospect of loosening BAA's grip on London airports moved nearer to take-off yesterday. Good. The UK's competition watchdog believes that there could be some competition between Heathrow, Gatwick and Stansted if they were separately owned. Different ownership would not provide a complete solution to the miseries of using Heathrow. But it is a necessary part of an answer that must also include a revamped regulatory regime.

Ferrovial must have become inured to abuse for its operational management of BAA. In the months since June 2006, when the Spanish group took on a pile of debt to buy the airport company, Heathrow has become hated, a byword for chaos and incompetence.

But the report from the Competition Commission on its "emerging thinking" still makes uncomfortable reading. The regulator expresses particular concern that the airport group seems unresponsive to the needs of airlines and passengers and worries about the impact on investment and customer service. In regulator-speak this is strong stuff.

Nor can BAA take refuge in its usual argument that there cannot be competition between London's airports until the severe shortage of capacity has been alleviated. The report turns this analysis on its head, to question whether the capacity problem can be addressed without an injection of competition.

The potential benefits of competition are apparent. Research suggests that some travellers are already prepared to switch between the three London airports on some short-haul and leisure flights, so competing owners would have incentives to improve services to attract airlines and their customers. Different owners for Gatwick, Heathrow and Stansted would mean more sources of investment and the ability to focus on more than one big project at any one time. Competition would also improve regulation, since it would enable comparison between operators.

Alongside a break-up there must be a wide-ranging regulatory overhaul. The current regime is feeble and inflexible. It does not provide the right investment incentives and fails to penalise the small service failures that blight travel on a daily basis. A break-up would also mean new challenges. The regulator would, for example, have to ensure that Heathrow did not focus on where it was most likely to lose business at the expense of, say, long-haul passengers who could less readily go elsewhere.

Breaking up BAA would not create a passengers' paradise overnight. But without a split that paradise looks even less attainable.

Frustrated passengers may find their spirits slightly lifted by reading the competition watchdog's unflattering assessment of BAA's stewardship of Heathrow and other leading airports.

Beneath the Competition Commission's temperate and sometimes technical language lies a wide-ranging critique of BAA's performance - from security queues at Heathrow to waiting times for bags at Aberdeen. The deeper message is that responsibility for the problems is spread wider than the company, with the crisis rooted partly in the inability of the transport system as a whole to cope with a big rise in demand for air travel.

The commission notes that BAA's south-east airports - including Heathrow, Gatwick and Stansted - show a "lack of responsiveness" to airlines and passengers. It picks out embarrassing statistics, including Heathrow's 90th-place ranking (out of 101) in a survey by Airports Council International - an operators' group - of customer perceptions of service.

Heathrow, Stansted and Gatwick all rank 93 or below on the council's rankings of waiting times in security queue. A separate BAA survey last year found that a third of Heathrow passengers said they had experienced a wait of 10 minutes or more at security points. Christopher Clarke, the commission's inquiry chairman, noted many complaints about airports, but said airlines and border officials must bear some responsibility for long-standing gripes over baggage handling and immigration queues.

While the commission's criticism of BAA's "failure to ensure operating excellence" may appear understated, it threatens far more serious problems for the company than angry passengers complaining about overcrowding or broken travelators.

The next test of Spanish-owned BAA's airports monopoly by Christopher Clarke will come when the Competition Commission's amiable deputy chairman uses its facilities to take a short-break in Sicily.

The 62-year-old former banker is known to spin a good yarn over a City lunch. But underneath this affability are strong leadership skills which have helped oversee the regulator's team put together in March last year.

Combined with sharp political antennae, it probably means that the commission is likely to recommend a break-up of the airports operator in its report this summer.

Mr Clarke read economics at Cambridge and joined Shell in 1967, going on to obtain an MBA from London Business School. After a stint at Arbuthnot Latham, in 1982 he became director of Samuel Montagu, the investment bank arm of Midland Bank, which was bought by HSBC. Mr Clarke was a director of its investment bank from 1996 to 1998, Joining the commission in 2001, he became deputy chairman in 2004 and led inquiries into store card credit services and current accounts in Northern Ireland.

The father of two is a member of Berkshire Golf Club, playing off a handicap of 15, but is eschewing golf for the Italian walking break with his wife ahead of the next stage of the inquiry.

The British Airports Authority was created in 1965 to run some airports formerly controlled by the Ministry of Civil Aviation, writes John O'Doherty.

It initially took ownership of just three London airports - Heathrow, Stansted and Gatwick - as well as Prestwick airport outside Glasgow. By 1975 Aberdeen, Glasgow and Edinburgh airports had been added, but Prestwick was sold off in 1992.

Following Margaret Thatcher's re-election as prime minister in 1983, the Conservative government took steps to privatise the authority. In July 1987 BAA plc floated on the stock exchange, raising £1.2bn.

Crucially - from the perspective of yesterday's announcement - that privatisation programme rejected alternative plans to break up the authority into competing airport companies, a scheme strongly opposed by BAA at the time. Concerns over BAA's dominant position in the UK's civil aviation market have surfaced at regular intervals since.

The other problem for the company has been capacity. As long ago as 1986 the Civil Aviation Authority argued that an additional runway would be needed in the south- east. But no new runways have been built, while additional terminals have opened in Gatwick and Heathrow and passenger numbers have more than doubled since 1990 at airports run by BAA.

In recent years BAA has expanded beyond the UK, taking over Naples airport in Italy and securing retail contracts at Pittsburgh, Baltimore-Washington International and Boston's Logan airport.

After the Spanish infrastructure group Ferrovial took over the company in 2006 for £10.3bn, it was announced BAA would sell some non- UK airports. It has since divested holdings in Budapest airport and some Australian airports.

Yesterday's announcement by Ruth Kelly, transport secretary, of a government review that should lead to a radical overhaul of the airport price control regime was welcomed by all sides - airlines, airports and the regulator.

The challenge will be to put in place a system that can support investment in new airport capacity, at reasonable prices, while ensuring passengers are provided with a quality of services that will end the airport misery of recent years.

While consumers want an end to "Heathrow hassle," the airlines ultimately expect the regulatory system to deliver a mechanism to hold the airports in check and moderate future increases in airport charges. They were stunned by the scale of the price rises recently approved by the Civil Aviation Authority, the economic regulator.

Three airlines - Easyjet, Ryanair and BMI British Midland - and the International Air Transport Association are planning applications for a judicial review of the five-year charging regimes recently approved by the CAA for Heathrow and Gatwick airports. Ryanair says it intends to challenge charges at Stansted.

BAA, the owner of all three London airports, believes that, on the contrary, the latest price settlement is squeezing its returns and fails to offer sufficient incentive to invest.

Harry Bush, CAA director of economic regulation, said recently that the regulatory regime could be improved "by placing the interests of consumers unambiguously at the heart of the CAA's duties and by encouraging competition between airports and between airlines for their business".

The present system seeks to reflect the often conflicting interests of airlines, airport operators and passengers. But in a clear warning to airlines angered by the scale of price increases at Heathrow and Gatwick, Mr Bush said it was "clear that regulatory reform is no magic bullet - airport investments and service quality will still need to be paid for".

The Competition Commission has yet to make its mind up on what regulatory reforms are needed but said yesterday it was concerned the present system might adversely affect competition.

Any changes to the regulatory system would not come into operation for at least six years, Ms Kelly said yesterday, in order not to change the price caps just agreed for Heathrow and Gatwick (and next year's settlement for Stansted) and to give investors at least some medium-term certainty on the financial outlook.

The airport regime, put in place in 1986, is one of the oldest economic regulatory systems in the UK and Ms Kelly accepted there was an "urgent need" to consider how the framework could be updated.

She said the government review would focus on how to provide incentives to improve the passenger experience, "encourage appropriate and timely investment in additional airport capacity to help deliver economic growth", and address the environmental impact of aviation on airport development.

A panel of experts led by Professor Martin Cave, a regulatory economist and director of the centre for management under regulation at Warwick Business School, will be appointed to advise her. The CAA has already made clear that it wants the scope of its powers to be brought into line with those of the other independent utility regulators including Ofcom, Ofwat and Ofgem in the telecoms, water and electricity sectors.

Currently, as the commission report pointed out yesterday, the CAA has only limited powers to intervene in an airport's business, once the price caps have been set for five years. In addition BAA, unlike other utilities, is not subject to a licence.

Importantly there are no provisions to ring-fence the assets of any airport or for a special administration regime in the event that BAA was to get into financial difficulties.

OUR COMMENT: There is also a need for the government and the aviation industry to accept that aviation must play its fair part in reducing carbon emissions. Expansion of airport capacity will only aggravate the situation. The first question might be – Are today's flights fully utilised? Does the UK need more passenger seats – as opposed to more flights? How many flights take off with less than maximum capacity? How many passengers are unable to book seats when they need them? And, how many bookings are stimulated by the repeated adverts in the papers for cheap seats?

Queuing at airports should not be taken as the equivalent of a bus queue waiting for full buses. How many flights are fully booked? The queues are a function of the terminal passenger capacity and efficiency. Are all the flights really needed? It's the flights that do the damage!

Pat Dale

Recent studies indicate that exposure to noise is damaging to your health. New research from the EU-funded HYENA (Hypertension and Exposure to Noise near Airports) Study shows that living near an airport increases your risk of hypertension.

Traffic noise from roads, airports and railways is a major environmental problem and is increasingly recognised as a serious threat to public health by the World Health Organisation. Recent research suggests a link between traffic noise and hypertension, a medical condition in which blood pressure is raised.

A 4-year study carried out as part of the HYENA project, explored the health effects associated with exposure to aircraft noise. The project included studies near major airports in Germany (Berlin Tegel), Greece (Athens), Italy (Milano Malpensa), the Netherlands (Amsterdam Schiphol), Sweden (Stockholm Arlanda) and the UK (London Heathrow). In total, 5,000 participants, between 45-70 years of age, who had lived near any of the six European airports for at least five years, were included in the study.

Participants were exposed to substantial night-time noise in all the participating countries, particularly in the late evening and early morning. Night-time noise caused a significant increase in blood pressure amongst participants. The results suggest that an increase in night-time aeroplane noise of only 10 decibels increases the risk of blood pressure by 14 per cent in both men and women. Exposure to 24-hour road traffic noise also increases blood pressure, particularly in men.

The International Air Transport Association (IATA) has predicted an annual growth in the number of passengers of 4.3 per cent until 2015. As air travel is on the increase and airports are expanding to meet this demand, traffic noise around airports is likely to increase. This research suggests that the rise in noise will also contribute to the growing burden of cardiovascular disease on public health resources.

Preventative measures should be considered to reduce noise. The Green Paper on Future Noise Policy aimed to develop noise reduction policies to prevent human exposure to excessive noise levels, which endanger health and quality of life. Following on from this, the Directive on Environmental Noise aims to provide a common basis for tackling the noise problem across the EU.

THE finest talent from Essex and beyond came together at Little Easton's Barn Theatre on Saturday to support the campaign against Stansted expansion. More than 150 turned up to the sell-out show, raising around £2,000 for SSE's second runway fighting fund. Some 17 acts took the stage, providing a wide variety of entertainment from music and comedy to magic acts and dance routines.

Among those watching the show was "Her Majesty the Queen" - or rather actress Jeanette Charles, who has played the monarch in such popular films as Austin Powers: Goldmember and The Naked Gun.

Most performers - some amateur, some professional - came from within the [Observer] area, with a few extra coming from further afield.

The bill included Bishop's Stortford musician Keef Jackman, who runs the highly successful Acoustic Club at the town's Half Moon pub, and former music teacher Liz Kadir, of Stansted, who showed off her talents on the French horn.

Dunmow singer and guitarist Laura Kearns performed a song she had written called I Won't Let Them Take My Home From Me, which reflected many residents' concerns about the future of their area.

The show was the brainchild of Broxted resident Irene Jones, who has been campaigning against the expansion of Stansted Airport for more than 30 years. She said: "We started auditions in January, and it was difficult at times because people have jobs and we couldn't always get everyone together for rehearsals at the same time."

"The Barn Theatre is a particularly appropriate location, as it is threatened by expansion at Stansted. I didn't know how popular this evening would be, but after it sold out I just wish I'd arranged it to run for more than just one night!"

"We had no problem selling the tickets at all. People have been very supportive - they want to come and have a good time, but they also want to show their support for the cause. Fund-raising events like this help us to cement our belief as a community in what we are doing."

Cosmic rays have their origins in hugely energetic events in space
Research has thrown further doubt on the notion that cosmic rays are a major influence on the Earth's climate.

The idea that modern global warming is due to changes in cloudiness caused by solar influences on cosmic rays is popular with "climate sceptics".

But scientists found changes in cosmic ray flux do not affect cloud formation - the second such report in a month. Separately, other researchers have found that particles from space may affect temperatures at the poles.

Both pieces of research were presented here at the European Geosciences Union (EGU) meeting.

As a factor in climate change, we don't have any indication that this is important at all

Cosmic rays, hugely energetic particles coming from space, smash into the top of the Earth's atmosphere, creating a cascade of charged particles lower down. These particles may help water droplets to coalesce, and so aid the formation of clouds.

The proposed link to climate change is that cosmic rays can be partially blocked by the Sun's solar wind. When the Sun is forceful, there are fewer cosmic rays arriving in the atmosphere, so fewer clouds form, which has a net heating effect on the Earth.

FEELING THE HEAT

Three theories on how the Sun could be causing climate change

If the mechanism has an impact today, several scientists have hypothesised, it should be possible to spot a link between the intensity of cosmic rays and the formation of clouds.

Jon Egill Kristjansson from the University of Oslo is one; and he unveiled his new results at the EGU meeting.

Human trails Over the southern Atlantic, Pacific and Indian oceans, where air is much cleaner than in more urbanised regions of the world, particles from ship's chimneys change the properties of clouds in a way that is clearly visible to the Modis instruments (Moderate-resolution Imaging Spectroradiometers) onboard Nasa's Aqua and Terra satellites.

Nasa satellites show the impact of shipping exhausts on cloud formation

The particles are stimulating the formation of water droplets. If cosmic rays play a significant role in cloud formation, Dr Kristjansson reasoned, sudden changes in cosmic ray intensity should also show up, producing increases in cloud cover, changes in the size of droplets, and possibly in the total amount of water carried in the clouds.

"We have short-term changes called 'Forbush decreases', caused by eruptions on the Sun, where cosmic ray flux can decrease dramatically over one or two days and then gradually recover," he told BBC News. "The cosmic ray signature on clouds, if there is one, should show up here."

He identified 13 Forbush events between 2000 and 2005 and looked for evidence in Modis data of concurrent changes in could properties. Although some of the events were followed by a decrease in cloud cover or changes in the size of cloud droplets, others preceded an increase in cloud cover, or no change at all.

Overall, the results essentially appeared random; abrupt dips in cosmic ray intensity did not produce any discernible pattern of changes in clouds, either immediately or in the four days following the Forbush decrease.

"This is a careful piece of work by Jon Egill Kristjansson that appears to find no evidence for the reputed link between cosmic rays and clouds," commented Joanna Haigh from Imperial College London, who is also attending the EGU meeting and has also studied possible links between solar variability and modern-day climate change.

Data showed no impact of galactic cosmic ray (GCR) flux on cloudiness

"It's supporting other recent work that also found no relationship," she added, referring to a research paper published two weeks ago by a UK team which, using different sets of data and different means of analysis, also found no discernible influence of cosmic rays on cloud cover.

"I think that as a factor in climate change, it's pretty clear that we don't have any indication at this point that this is important at all," added Dr Kristjansson. "Whereas global mean temperatures have been rising steadily over the last 30 years, we see that the cosmic ray flux has been steady."

Local change

The EGU meeting also saw the first presentation of other research that could perhaps help to explain temperature variations seen between different regions of the Arctic and Antarctic.

Computer models have predicted that energetic particles hitting the top of the atmosphere in polar regions may change temperatures by stimulating the production of nitrous oxides (NOx).

"The energetic particles induce NOx production, and the NOx is then transported down to the stratosphere," explained Annika Seppala, who led the project from the Finnish Meteorological Institute and also works with the British Antarctic Survey. "NOx destroys ozone in catalytic reaction cycles; and when you change ozone in the stratosphere, that... can then feed down to surface temperatures," she told BBC News.

Periods of intense activity warmed (red) some regions and cooled others (blue)

Dr Seppala's observations appear to bear out the models' predictions, at least in winter in the polar regions. In periods of relatively intense particle activity, some areas of the Earth's surface in both the Arctic and Antarctic are warmer while others become colder, showing differences of up to 2C or 3C compared to the long-term averages.

In periods of unusually low particle activity, the patterns are reversed.

The mechanism appears to be redistributing heat across the polar regions; there is no evidence for any overall warming or cooling, Dr Seppala added, nor that the scale of the effect has changed over time.

"The results were amazing, and I think it's something significant that we have to take into account," commented Katje Matthes from the Free University of Berlin, who chaired the EGU session which saw the new data presented. "I think it's rather a local effect," she added, "and I don't think it has a big impact on global temperatures."

The Antarctic picture is particular fascinating. High particle flux places a big red patch, indicating warmth, over the Antarctic Peninsula, an area that is feeling the impacts of climate change faster than most other parts of the planet.

The heating and cooling from this mechanism might be short-term; but scientists studying the loss of ice from this region of Antarctica will surely want to understand whether the short-term natural highs and lows combine with the overall warming trend in a way that speeds melting.

Dr Seppala's team now intends to investigate what happens in the other seasons of the year, which will give a better understanding of the importance of this newly confirmed process.

"As leaders of the aviation industry, we recognise our environmental responsibilities and agree on the need to:

* Build on the strong track record of technological progress and innovation that has made our industry the safest and most efficient transport mode; and

* Accelerate action to mitigate our environmental impact, especially in respect to climate change while preserving our driving role in the sustainable development of our global society.

Therefore, we, the undersigned aviation industry companies and organisations declare that we are committed to a pathway to carbon-neutral growth and aspire to a carbon-free future.

To this end, in line with the four-pillar strategy unanimously endorsed at the 2007 ICAO Assembly, we will:

1. Push forward the development and implementation of new technologies, including cleaner fuels;
2. Further optimise the fuel efficiency of our fleet and the way we fly aircraft and manage ground operations;
3. Improve air routes, air traffic management and airport infrastructure; and
4. Implement positive economic instruments to achieve greenhouse gas reductions wherever they are cost-effective.

We urge all governments to participate in these efforts by:

1. Supporting and co-financing appropriate research and development in the pursuit of greener technological breakthroughs;
2. Taking urgent measures to improve airspace design including civil/military allocation, air traffic management infrastructure and procedures for approving needed airport development; and
3. Developing and implementing a global, equitable and stable emissions management framework for aviation through ICAO, in line with the United Nations roadmap agreed in Bali in December 2007.
Our efforts and commitment to work in partnership with governments, other industries and representatives of civil society will provide meaningful benefits on tackling climate change and other environmental challenges. We strongly encourage others to join us in this endeavour."

OUR COMMENT: Note the reservations, its not all as good as it claims to be!

Pat Dale

Heathrow's profits rose by more than 10 per cent last year, despite the UK's largest international airport coming under repeated criticism for its poor service and standards. Accounts for the private holding company that owns BAA, the airports operator, show that Heathrow's operating profits rose by £40 million to £438 million in 2007.

Profits at Stansted rose 68 per cent to £86 million after BAA doubled the charge for each passenger using the airport.

The sharp rise in profits angered airlines who use BAA's facilities. They claim that the company is making huge profits but is failing to offer a good service. Heathrow, in particular, has faced repeated criticism for long security queues and the poor quality of its infrastructure.

The rising profits will provide airlines with further evidence that BAA is abusing its position as the owner of London's three main airports. The Competition Commission is expected this month to deliver its preliminary findings on whether BAA's London monopoly should be broken up.

Jim Callaghan, the head of regulatory affairs at Ryanair, said: "BAA is abusing its monopoly position by charging outrageous fees while providing a rubbish service and that is why they can enjoy huge profit increases."

BAA was bought by Ferrovial, the Spanish infrastructure company, in 2006 through a subsidiary called Airport Development and Investment Limited (ADIL), which filed 2007 accounts with Companies House last week.

The ADIL figures show that revenue for BAA's seven UK airports, as well as Naples airport in Italy, was £2.2 billion, up 7.9 per cent from the previous year. The company made profits of £745 million, up 13.4 per cent.

The accounts also show that ADIL is reducing the amount that it spends on new infrastructure at Heathrow, despite BAA's claims that it is working to improve the facilities. Capital expenditure was £875million last year compared with £977 million in 2006.

BAA said yesterday that this was due to reduced spending on Terminal 5 as it neared completion. However, Ferrovial has been unable to reap the full rewards of BAA's big profit increase because of enormous interest payments on the debt taken to finance the BAA acquisition.

ADIL was able to pay Ferrovial and its other backers only £86 million last year after interest payments of £964 million. ADIL's total debt stands at £16.9 billion and Ferrovial has been unsuccessfully trying to refinance in order to reduce the interest payments. If it fails to refinance within the next two months, BAA's credit rating is likely to be moved to junk status.

Ferrovial has sold World Duty Free and part of its property portfolio in an attempt to reduce its debt levels.

The criticism of Heathrow's profits comes as British Airways faces its own problems at the airport, particularly the recent chaotic move into its new home at Terminal 5. Standard Life Investments, BA's second-largest shareholder, has begun a series of meetings with senior executives at the airline. It is understood that Standard Life will meet Willie Walsh, BA's chief executive, today having spoken to Martin Broughton, the chairman, yesterday.

The problems at Terminal 5 are thought to be only one of a list of issues that will be raised with management. The meeting comes as investors are becoming increasingly alarmed at the bad news coming from Britain's flag carrier. The T5 debacle followed a profits warning last month and shareholders are concerned that a malaise has started to set in at senior management level.

"We need to be sure that BA is prepared for a deteriorating operational environment. The economy is turning down and fuel costs have turned up," a shareholder said.

TOP airport cops look set to receive a £1 million boost to help them continue winning the fight against Stansted's criminals.

The latest figures released by Stansted Airport Police Force show a reduction in airport crime by almost 12 per cent over the last year, up to the end of March.

Divisional commander Chf Insp Ian Grüneberg, praised his 93 officers for their part in making Stansted the best-performing airport police force in the country.

Boasting a crime detection rate - the number of reported crimes that are solved - of over 61 per cent, Chf Insp Grüneberg said: "Essex Police are managing a detection rate of just over 30 per cent, so what we are doing here is a real achievement. I'm enormously proud of my officers who have worked as a team to meet the challenges of the last 12 months and make the terminal a safer place"

To continue winning the battle against the airport's criminals, the Chief Inspector said he expected to be able to announce the completion of a £1 million agreement between the police and the airport in a matter of weeks.

Chf Insp Grüneberg, 51, said: "The police services agreement is a win-win situation; it benefits the public of Essex, travellers, airport operators and the police. The agreement would see us receive one extra inspector, 18 extra officers and two additional vehicles, and it would all be funded by Stansted Airport Ltd and not the Essex taxpayers."

The extra resources will enable Stansted Airport police to improve their effectiveness by continuing operations that have proved successful over the last 12 months and introduce initiatives to tackle new threats.

Chf Insp Grüneberg highlighted a number of operations that had helped the force achieve their impressive figures. "Operation Bruno has reduced theft by baggage handlers from 10 offences per week to less than one a week," he said.

"The operation saw 19 search warrants executed and 23 arrests made including an eight-month prison sentence for the ringleader. A clear message was sent to baggage handlers, and people in trust at the airport, that they must look after the public's property."

Theft of rental vehicles was stopped almost overnight by the introduction of the car hire thumbprint scheme and police visibility has been increased through the neighbourhood policing initiative.

Future initiatives for the airport police include the introduction police dog patrols and a further crackdown on offensive weapons being brought into Stansted.

OUR COMMENT: Hopefully this means that Essex council tax payers will no longer subsidise airport security.

Pat Dale

The sudden collapse of Oasis Hong Kong Airlines shows how quickly the tide is going out for the world's airlines as they struggle to deal with surging fuel prices and softening economic growth. Start-up carriers such as Oasis are especially vulnerable, and inevitably it is the new business models, usually dreamed up in the years of feast, that start to look most at risk in times of famine.

One of the first casualties of the accelerating shake-out was Maxjet, a pioneer of the new breed of all-business class carriers that began springing up to fly the North Atlantic three years ago. Maxjet, US-registered but listed on Aim, London's junior market, collapsed into bankruptcy at the end of last year.

It blamed its demise on fuel price inflation, tough competitive pressures and a decline in consumer spending. In addition, the turmoil in the financial markets had made it impossible to raise fresh funds.

In recent weeks, at least five other US carriers have thrown in the towel, including small charter airlines. But the casualties include Skybus, a start-up low-cost carrier with new orders in place with Airbus for 65 A319 jets, and well-known names such as Aloha Airlines with more than 60 years of history and ATA.

Leading US airlines are reducing capacity in the domestic market, grounding old short-haul aircraft and are scrambling to try to increase fares as they struggle to come to terms with an oil price of more than $100 a barrel.

In Europe, the perennially lossmaking Italian flag carrier, is teetering on the edge of bankruptcy while the Italian unions decide whether or not to accept big job cuts and a shrinking of the airline in return for a last-ditch rescue by Air France-KLM. Among the industry leaders, British Airways has already warned that profit will decline significantly during the next 12 months.

Both Ryanair and EasyJet, Europe's two biggest low-cost airlines, have issued profit warnings, with Ryanair saying its profit could fall by as much as 50 per cent under the impact of rising oil prices and falling fare levels. "When the tide goes out, you find the business models that were never really sustainable," says Chris Avery, aviation analyst at JPMorgan.

Oasis Hong Kong styled itself as a low-cost long-haul carrier but in reality it was more a low-fare airline with a mix of some of the elements of the short-haul low- cost carriers that have proved so successful, alongside some of the high-cost elements of the traditional full service, long-haul carriers.

Asia has become the world's fastest-growing aviation market and Derek Sadubin, chief operating officer at the Centre for Asia Pacific Aviation, a Sydney-based consultancy, says the collapse of Oasis was unlikely to stop "a proliferation of new airlines in this region in the next few years".

He says Oasis had made some specific, questionable choices, however, notably devoting almost 25 per cent of its seating capacity to business passengers, thereby reducing the total number of seats available. Oasis was also flying four-engine Boeing 747-400 aircraft, consuming more fuel than twin-engine aircraft. Furthermore, as a standalone company, it did not have the brand recognition and internet booking synergies that airlines such as Jetstar and AirAsia X can derive.

Mark Webb, Hong Kong-based transport analyst for HSBC, says the fate of Oasis "indicates that the low-cost long-haul model is problematic". He adds: "Low-cost regional and short-haul models have been working in other markets but long-haul, low-cost hasn't really worked anywhere else either. Nobody has been able to do a profitable low-cost, long-haul carrier."

Still, Stephen Miller, Oasis chief executive, last night defended his airline's business model. "It just needed a little more time and a little more network [destinations], and a critical mass of aircraft," he told the Financial Times. "What Oasis has shown is that the business model is accepted by the market."

Analysts also said on Wednesday that the demise of Oasis would not halt moves by some Asian legacy carriers to develop low-cost offshoots. Among them, All Nippon Airways, the second-largest Japanese airline, recently established an Asian strategy unit in Hong Kong to look at regional expansion opportunities and forge ties with possible joint venture partners for the launch of a low-cost airline.

Azran Osman-Rani, chief executive of Malaysia-based AirAsia X, said on Wednesday that "The Oasis example reinforces our view that a sustainable low-cost, long-haul airline model must stick to core principles of high aircraft utilisation and high seat density to achieve a sustainable cost position". He added: "But more importantly, it is always a bigger challenge to start up a new airline from scratch."

The fiasco at Heathrow's Terminal 5 has "damaged London" and BAA, the airports operator, must take responsibility for the economic cost, Tessa Jowell, the minister for the capital, has told the Financial Times.

The warning came as British Airways yesterday delayed by at least five weeks the transfer of most of its long-haul flights at Heathrow to the £4.3bn showpiece terminal. The airline and BAA said the move from Terminal 4, due on April 30, would be postponed until June 5 at the earliest to allow time to "iron out any remaining problems". Rival airlines, which are to take over Terminal 4 once BA has left, criticised the delay.

BAA and BA are under intense pressure from the government to resolve the problems. Ministers fear that the poor performance of Europe's busiest airport is damaging the economy, as executives shun the UK rather than risk suffering lost baggage, delays and cancelled flights.

"Conditions at Heathrow have damaged London," Ms Jowell said. "I suspect if you're viewing the prospect of coming to London for business... you may just simply roll it all up into the trouble you expect when you get to Heathrow."

"BAA has to be responsible in a sense for every bit of lost business to London from people making that kind of decision [not to come to the UK]." Asked whether BA should also bear responsibility, she declined to "go right through the charge sheet".

The minister rejected accusations by some business people that London's sclerotic transport system meant the city could no longer function effectively, saying: "That is the very worst perception on a bad day. There are Monday morning problems, there may be wet Friday afternoon problems, and nobody would be for one moment complacent about those, but the fact is that London is one of the most attractive cities in the world to do business in."

The government believes the damage is not irreversible. "Provided the problems are resolved and don't recur, then I think that over time people will forget this pretty disastrous first month," Ms Jowell said.

But she warned of "the risk to London's economy of failure to sort out Heathrow. And I don't just mean in terms of it becoming a functional airport, but an airport that is, as some European airports are, a positive pleasure to arrive in."

IN January, BA38 from Beijing limped into Heathrow, skimming over the airport fence and crash-landing short of the runway. It was hailed as the "great escape" for those on board, and the ramifications are still being felt in Whitehall today.

When the stricken flight passed over motorists on the southern perimeter road, the jet was said to be so low "you could reach out of the window and touch it". The drama, however, raised a worrying question for those championing airport expansion: what if it had been trying to land on the proposed third runway?

Under the plans for Heathrow's expansion, Ruth Kelly, the transport secretary, intends to sandwich one of the busiest runways in the world between the elevated M25/M4 junction to the west and the residential area of Harlington to the east.

It emerged last week that the motorway junction, 650 yards from the end of the proposed runway, will be in the crash landing zone or "public safety zone" where there is an accepted higher risk of an accident.

Kelly's department failed to include maps showing this zone in the consultation documents, which critics say would have caused uproar. Department for Transport (DfT) officials have already been accused of fixing the evidence in favour of a third runway.

"It's ridiculous to put a runway so close to a major motorway junction and residential areas," said Geraldine Nicholson, who lives adjacent to the junction and chairs the No Third Runway Action Group.

"They are wanting to put this runway in one of the most built-up areas in Britain and we're being told they haven't even yet carried out a detailed risk assessment. It's crazy."

When the government's 2003 white paper backed the third runway, it envisaged it would be 1.2 miles long. It has now been lengthened, partly to accommodate a greater mix of aircraft, but also to allow flights to clear the considerable obstacles at both ends safely.

The government's consultation document states: "The position of the third runway is governed by the need for aircraft to maintain a safe distance from the elevated M4/M25 junction to the west and the Harlington church spire to the east."

To date, the row over Heathrow expansion has centred on the extra noise and pollution. Flight BA38 has focused attention on the safety problems. Tim Jurdon, manager of the aviation team at Hillingdon council, said: "The safety zones are where it's most likely there could be a crash. If it wasn't at Heathrow, we would argue there would be less risk."

Jurdon's team have drawn up the "public safety zones" at both ends of the third runway. He says the western zone crosses the M25/M4 junction. This was not disputed last week by the DfT, which said safety would be considered by any future planning inquiry.

The government's policy on airport safety zones is detailed in a 2002 circular and states that the number of people in the zones should be kept to a minimum. It says: "The basic policy objective governing the restriction on development near civil airports is that there should be no increase in the number of people living, working or congregating in public safety zones and that, over time, the number should be reduced as circumstances allow."

With a likely surge in traffic growth if Heathrow expansion is approved, the government appears to breach its own guidelines by allowing a safety zone to cross a motorway junction. They state that busy traffic routes should be considered on a par with housing developments when assessing the impact of the zones.

Geoff Marks, an executive council member of the Aviation Environment Federation, a nonprofit making organisation campaigning for sustainable aviation, said: "The fact the maps of the public safety zones are not even in the consultation document suggests the government hasn't done its job properly."

Marks said the government should consider adding airport capacity in more open areas, such as the Thames estuary, where there would be a significantly lower risk of casualties in the event of a crash. He said other large airports, such as Charles de Gaulle in Paris and Munich International airport, were located away from big cities partly to reduce the risk of ground casualties in the event of a crash.

A report commissioned by the DfT on airport public safety zones in the 1990s said it was too costly to relocate transport routes that already fell within the zones. Safety objections will be aired in a planning inquiry if the government approves the third runway this summer.

New documents released under the Freedom of Information Act also show the Civil Aviation Authority raised a series of safety concerns during the consultation process.

CAA officials were understood to have been concerned about the extra air traffic at Heathrow and the potential conflict with air traffic from nearby RAF Northolt, which is regularly used by ministers. In one DfT meeting, officials were told there was a "conflict of objectives" between expanding commercial activities at Northolt and the proposed Heathrow expansion.

The CAA also raised concerns about proposals to have gaps of just 60 seconds between planes taking off in the same direction from the two existing runways. CAA officials were concerned the proposal might breach international safety standards.

The DfT last week said "the issue of the number of people affected by any new public safety zone would need to be looked at as part of any future planning application". It failed to respond to whether allowing the M25/M4 junction to be at the end of a runway broke its own guidelines.

The department said the guidelines were publicly available and the question would be a matter for any future inquiry. The statement said: "Safety is the government's top priority. The proposals and location for a third runway at Heathrow in the consultation document have been developed with the CAA and safety considerations were taken fully into account."

The DfT said the "airspace arrangements" for Heathrow expansion had been reviewed by the CAA and approved for the consultation document. "The proposals are not definitive and would need further detailed work."

AIR chiefs say the growth in the number of people flying has slowed down dramatically. New statistics from the Civil Aviation Authority show that last year UK airports handled 241 million passengers - an increase of just 2.4 per cent on 2006, with growth in numbers at their lowest for a decade. Since the 1970s, annual growth had been six pc a year.

Experts say there are several reasons why people are thinking twice about flying - with less money in their pockets to spend on holidays being the main one. Better rail services are also having an impact on how people travel, with more people taking to the train for trips around Britain. Use of domestic flights fell by 1.9pc last year.

Despite the slow down, the air industry is still determined to press ahead with its expansion with more cheap flights and plans to expand airports, particularly Stansted and Heathrow. Currently around 1,200 jet planes fly over Suffolk every day - causing growing frustration over noise and concern over pollution.

Government believes doubling air travel over the next 20 years will boost the economy, but that will simply mean more passenger planes flying over Suffolk.

Expert Dr Harry Bush said: "The CAA's analysis shows the impact on passenger air travel of recent slowing of consumer expenditure, but also indicates a significant impact from the recovery of rail travel and from the increasing internationalisation of the UK economy, with the consequent growth in air travel to visit family members or friends in other countries."

"Looking to the longer term, demographic changes and ownership of homes abroad are also likely to buttress air travel demand, although relatively small changes in frequency of leisure travel between mid and higher levels of income suggest demand growth is constrained to some extent by factors other than income, such as availability of leisure time."

The CAA said during 2007, landings and take-offs of commercial aircraft at UK airports grew by 1.8pc to 2.5 million. At the London airports - Heathrow, Gatwick, Stansted, Luton and London City - the increase was 2.6pc, bolstered by increases of 16pc at London City and 6pc at Luton.

A CAA spokesman said: "More regional airports are developing a greater range of services and there are now nine airports handling more than five million passengers each a year, together accounting for nearly one third of all UK passengers, while a further nine airports each handle more than one million passengers annually."

Are there too many planes flying over Suffolk?
Write to Your Letters, Evening Star, 30 Lower Brook Street, Ipswich, IP4 1AN, or e-mail EveningStarLetters@eveningstar.co.uk

FASTFACTS: Who flies most?
Half of the UK population do not fly at all in any year - those who do take more than two return trips on average.
Higher income households take more flights, single people and childless couples fly more than families, and those who own property abroad fly often.
Households with total earnings over £115,000 per year take around 60 per cent more trips per year than those earning less than £40,000.
Regional airports have continued to grow at a faster rate than London airports, and in 2007 handled 42 per cent of passengers at UK airports.

The Stern report on climate change underestimated the risks of global warming, its author said on Wednesday, and should have presented a gloomier view of the future.

"We underestimated the risks... we underestimated the damage associated with temperature increases... and we underestimated the probabilities of temperature increases," Lord Stern, former chief economist at the World Bank, told the Financial Times on Wednesday. In retrospect, he said, he would have taken a much stronger view in the report on the drastic changes that would come about if greenhouse gas emissions were not abated.

In the report, he estimated the costs of climate change at between 5 per cent and 20 per cent of global gross domestic product. But these costs would be much higher if the report had taken a more aggressive stance on the probable consequences of warming. Lord Stern said data published since his report came out, in October 2006, had led him to change his mind.

Last year, the Intergovernmental Panel on Climate Change, the body of the world's leading climate scientists convened by the United Nations, published the most comprehensive study of climate change science. It predicted a temperature rise of 3 degrees Celsius within the next 100 years with catastrophic consequences for the planet, unless greenhouse gas emissions were stabilised and then cut within the next decade.

"The damage risks are bigger than I would have argued. Things like the damage associated with a 5 degree temperature increase are enormous. We can't be precise about what it would be like but you can say it would be a transformation," he said. But he defended his estimates of the cost of taking action on emissions, which he put in the report at about 1 per cent of global GDP.

"Subsequent reports, [from] McKinsey, the International Energy Agency, the Intergovernmental Panel on Climate Change, have pointed to the [Stern report's] costs of action being roughly in the right ball park. Nothing [since] has led me to revise the cost of action," he said.

"I probably would have emphasised the importance of good policy [if writing the report again today] and how bad policy puts up the costs [of cutting emissions]," he added.

Lord Stern has come under attack from economists and climate change sceptics since his report, which some sceptics regard as scaremongering. Some argued that he underestimated the cost of taking action to cut emissions and overestimated the benefits to future generations.

Following the publication of his report, Lord Stern visited dozens of governments around the world to persuade them of the need to cut emissions and the low cost of doing so. His report has formed a key part of discussions on climate change policy, including the UN-led negotiations last December in Bali at which a timetable was drawn up for two years of negotiations on a successor to the Kyoto protocol.

Plane Stupid Scotland scaled the Scottish Parliament building today, in an early morning protest at Scottish Government plans to impose massive airport expansion by the back door. At 2pm the protestors voluntary walked off the building, were arrested and taken to St.Leonards police station.

The surprise occupation exposes outrageous Government proposals to ban the public and MSPs from consultations that sanction major developments, including airport expansion. The action comes the day before consultation on these National Planning Framework proposals closes. Two members of Plane Stupid Scotland occupied the rooftops of the Parliament, unfurling a massive banner saying, "Planestopping! Choose a future: No airport expansion."

Under National Planning Framework proposals, Ministers will designate a whole generation of dirty development as 'National Developments', which bypass public or parliamentary approval. Subsequent planning enquiries will be limited to design issues. The meager consultation exercise on the proposals ends tomorrow (April 15) with legislation expected in the autumn.

The NPF is being targetted for its signicant – but stealthy - contribution to UK-wide airport expansion programmes, and the massive increase in carbon emissions that airport expansion will produce.

Plane Stupid Scotland spokesperson Tilly Gifford said: "The environmental and democratic credibility of this Framework is zero. We are facing a runaway climate threat, but the Scottish Government's reaction is to triple air traffic and use the NPF to gag affected communities. Without reducing aviation and emissions there will be no future to plan for."

The proposals list Edinburgh and Glasgow airport expansions as National Developments, reinforcing existing plans to expand all Scottish airports by 2030. As a blank cheque for massive airport expansion with no scrutiny or accountability, the NPF is recipe for disasters like Heathrow in every major Scottish city.

The planned expansion, from 14 million to 50 million passenger movements by 2030, would cause a massive rise in climate change emissions, confirming aviation's position as the fastest growing source of greenhouse-gas emissions in the UK. The program makes a mockery of the NPF's sustainability remit, and of Scotland's target of reducing emissions by 80% by 2050.

Spokesperson Richard Shore added: "Aviation is destroying our future and retreating into smoke-filled rooms is no solution. You don't get good planning by gagging the people you're planning for. We need democracy, and we need to face the fact that air traffic must shrink."

Plane Stupid Scotland is fed up with Government inaction and white elephants in the face of an unprecedented climate threat. Today's action by Plane Stupid Scotland is the start of concerted action against the National Planning Framework, as part of the growing movement of ordinary people who have decided we must act ourselves to tackle climate change.