United Kingdom
How have the 2011 Budget announcements affected business travel?
Osborne’s announcement on the UK Budget affects business travel, like it or not. Here are the main things you need to know for corporate travel management.
No increase in Air Passenger Duty...yet!
Looking back at the announcements made by our chancellor, none seem as surprising as the one proclaiming a freeze in Air Passenger Duty (APD)...with the surprise being that no one in the industry had expected an increase in the first place! Many had even called for a reduction ahead of the Budget. The Chancellor predicted that revenues from APD will rise from £2.2bn in 2010 to £3.6bn in 2016, with the additional income almost certainly being driven by future increases in the levy. Time for more lobbying by the airline industry!
Ideas to charge APD on a per-plane basis...
The Chancellor ruled out plans to charge APD on a per-plane basis, rather than a per-passenger basis. The outcome is likely to mean increased costs for business travellers flying within the UK, since it's imposed on every flight taking off from Britain, meaning a passenger on a domestic return trip pays twice. In addition to the expected long-term rise in APD, the UK’s entry into the European Union emissions trading scheme next year will effectively be a 'double tax'.
Regional rail improvement schemes
The final big transport announcement was the earmarking of a £200m investment for regional railways, including an £85m 'budget bonanza' (as the Guardian described it), for a direct train link between Manchester's two main stations. Funded through savings made by the Department for Transport, it’s expected to cut journey times between Manchester and Leeds by 14 minutes, and could open as early as 2016. A Network Rail blueprint for the wider region says a total of £530m needs to be spent on a range of additional improvements, which it is claimed could help create 23,000 jobs and stimulate £4.2bn in economic benefits.
