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Blackpool Airport Enterprise Zone Update

Blackpool Airport Enterprize Zone UpdateAs the responses to consultation on this new Enterprise Zone are being considered, we take a quick look at  what is happening at the Airport,  and what it might mean for the future.

We also reproduce comments made by two of our readers who are concerned about what is, or at least might be,  going on.

SYNOPSIS
Under the heading 'Previously' we begin with a quick review of the last few years of what was a growingly successful  'Blackpool International Airport' (Now titled just plain 'Blackpool Airport') before looking at how things went wrong, and how the Shrunken service airport tried to adapt to its new life.

We then ask 'What's an Enterprize Zone' and How this Blackpool Enterprise Zone  is likely to work (or not).

Finally, we have a look at What it all means and what the implications are for the future.

 PREVIOUSLY.......

It was all going so well back in the early years of the millennium.

The airport was typically handling around 300,000 passengers a year, Blackpool looked set to get it's money-spinning Las Vegas style Casino, and the airport was about to take off.

We covered this in 'Candyfloss to Casinos?' in 2006

Shortly afterwards, in 'Flight of Fancy' we recalled a speech given by a chap from the Airport saying their plan was to increase passenger throughput from the current 350,000 a year to 6 million passengers a year over the next six years.

He gave an impressive and detailed presentation, and because he was speaking to a pensioner's group we think he was being a bit more candid than usual.

Around that time, there were also rumours of another plan to extend the runway (so it could accommodate 747's), including extending the runway over Queensway, with the road being lowered into a sort of tunnel under the runway.

Then, whilst Blackpool Council retained a 5% stake in the airport, they sold their controlling interest to MAR Properties who took on 'City Hopper Airports Limited' to manage the airport property via a newly created firm called Blackpool Airport Limited.

They would deal with day to day running of the airport.

We remember locals extolling the convenience of being able to book in, then go home for lunch, before returning shortly before their budget airline flight to the Ireland, the Canaries, Spain or wherever.

We also knew of  folk from further afield (Yorkshire and Southport to name but two places), who also regularly travelled to fly from Blackpool because it was less hassle than flying from one of the bigger, regional airports.

It seemed to us that the growth plan for the airport was likely to become reality.

But the casino idea went bust, and the envisaged growth of travellers evaporated.

Worse still, it turned out that those very budget airlines - who were so popular for their low flight prices - were not in symbiosis with the Blackpool Airport Ltd. They were operating as parasites.

Traditionally Blackpool Airport Ltd would have covered its operating costs (control tower, on-site fire service, terminal building, security, maintenance etc) from the landing fees that were charged to airlines. But the budget airlines had a different model. They said - in effect - 'No we're not paying you to land here, we're bringing thousands of passengers here and you can market at them to make your operating money'

And in some cases (like some supermarkets charge suppliers for shelf space in order to stock their product), some of the budget airlines even wanted paying by the airport company to fly from the company's airport.

Without the anticipated growth from the Casino traffic, smaller airports like Blackpool couldn't survive this business model and got into financial difficulty.

We all remember Blackpool's  imposition of the £10 'Development Fee' for all passengers. This was extremely unpopular, but was essential, simply for the airport to survive.

But this passenger surcharge was too much for Ryanair who, in late 2008, axed flights because of it. Then destinations were lost from the schedules of other carriers.

The airport's decline was gathering pace.

Then came the disastrous court judgement of December 2010 which upheld Jet2's claim that the airport operating company was contractually obliged to keep the airport open at specified times, even when so few passengers were around that it was clearly uneconomic for the airport to do so.

And this at a time that passenger numbers through the airport were already down by 25%

Finally, in 2012, Blackpool Airport Ltd's legal appeal against the Jet2 decision failed, and that sealed the fate of the airport.

Two years later, in 2014, Blackpool Airport Ltd finally threw in the towel and closed the airport, creating enormous controversy locally.

But looked at through the prism of the operating company, we think it's actually surprising how long it's parents allowed it to continue to to lose money for them.

 THE SHRUNKEN AIRPORT

A period of adjustment followed as the parent companies adjusted to the new regime.

Out went the expensive fire service cover that was so costly to maintain. The absence of this cover further reduced the scale and scope of the sort of planes that could land at Blackpool, even the Red Arrows departed. T

he Control Tower cover became intermittent as a skeleton staff didn't have the spare capacity to cover for sickness and when people left for jobs elsewhere.

The terminal was closed and important infrastructure sold off to reduce losses and recover some of the expense that had been incurred.

Finally, the airport reached a sort of equilibrium. By running with the less infrastructure-intensive services like private and small commercial flights, and especially the helicopter operations to service the offshore oil platforms, the airport once again became financially self-sustaining and was hobbling along as a faint shadow of its former self.

Insiders told us there was no hope that the glory days of the early 2000's would return because (without the Casino or some other major draw) there was simply not enough of a catchment area for people when half of it was made up of fish.

Being stuck out on a limb at the end of the M55 meant that the international commercial flights would almost certainly never return, let alone the intercontinental ones that were once predicted.

Or at least that was the conventional wisdom, but  don't altogether agree with the analysis.

We think history will think badly of those who failed to see and capitalise on the potential of an integrated transport hub on and around the former Pontins site. A hub that could have provided an undercover rail link from international Manchester Airport as a direct local feed to Blackpool Airport, together with space for ample parking of cars, commercial vehicles, coaches, buses and even the tram service serving the whole of the Fylde coast and the wider North West.

Instead of a vision to create a future, those charged with such decisions instead sought a plan to allow housing to be built on the closed Pontins site and to re-develop the airport and its associated environs for commercial and industrial uses.

But unfortunately, the price we will have to pay for this lack of vision is the loss of parts of the 'Green Belt' that are the visual separation of Blackpool from Fylde.

In essence what's going to happen is a planning 'slight of hand' will be employed to do what would otherwise be very unlikely to get planning permission.

This will see the reduced scale of airport operations - and some recreational land use - moved into the green belt  closer to St Annes.

This can be done because of the particular circumstances of airports. They are allowed to erect buildings necessary for the operation of the airport without having to get planning permission (though whether the use of green belt land for this purpose can be justified remains a moot point).

Moving the operational airport will allow the (now vacated) airport infrastructure space to be 'land laundered' into redundant previously developed land that is ripe for commercial and industrial re-development - some of which looks as though it will be funded by 'enabling' housing development near the Trebaron Garden Centre

 We believe very little of this would stand up to the scrutiny of a planning application were it not for the fact that is is to be viewed in future as 'redundant previously developed airport land' - once the airport itself has been moved further into the green belt.

And to make this happen more easily, the powers that be have chosen to designate large areas of the former airport and its surroundings as an 'Enterprise Zone'

 SO WHAT'S AN ENTERPRISE ZONE?

To some it's an exciting new possibility for regeneration of a failing or redundant former land use.

To others (including ourselves) the creation of an Enterprise Zone is actually an admission of failure.

And by that, we don't just mean a decline and failure of the former land use.

We mean an admission of failure of national planning and taxation policy which has created the situation where business and industry is unwilling to invest for profit.

This policy failure manifests itself in the unwillingness of business to invest.

Without relaxing the planning regulations and giving bribes from Government to reduce their setup costs, businesses won't invest at the airport.

In effect an Enterprise Zone is an area where normal planning restrictions don't apply, and where businesses are allowed tax reductions to attract them to set up or move their businesses there to 'create' employment.

Regular readers will know of our distaste for Enterprise Zones. They risk creating what are known as 'Rate Tarts' where businesses continually relocate to the latest Enterprise Zone to be created in order to take advantage of the low (or sometimes no) business rates payable (and other financial incentives) for as long as they are available, only to move again when they end at that site.

Such businesses do not create wealth or employment, they simply move it around.

The call centre (or whatever) loses jobs in Sunderland when it 'creates' employment as it moves here to Blackpool. There is no real benefit, and there is a loss of taxation income that ought to be helping to pay for public services.

But the biggest failure in our view is that by their very existence, Enterprise Zones demonstrate the failure of Government and Local Government to create a planning and taxation regime in which business may arise or expand WITHOUT having reduced planning regulations and reduced taxation requirements.

 SO HOW WILL THE BLACKPOOL ONE WORK?

Well to be honest, the plan does seem to keep changing, and one of the stated features of the plan is that it expects to keep changing in response to the situation(s) prevailing at the time. 

It doesn't help much when the glossy coloured brochures seem to change according to the audience that need to be impressed at the time. There was one version to send to the Government in the early days (when promises of tax and capital benefits were needed), and another has been produced for the consultation.

We expect further variants for whatever planning applications (if any) will follow.

So it's tricky to pin down exactly what will happen, but if we start with the area involved, that's pretty fixed now....

This is a view from the coast, and as you can see, the area proposed for built development of one sort or another is quite a bit larger than the presently developed area.

Everything within the red line above is potentially a hard surface in the future, not grass.

The overall plan to attract businesses is that within this area an exemption of up to 100% of business rates that would otherwise be payable will apply for at least 5 years from when you move in.

Over that period it's the equivalent of a grant to businesses who move in  (or, crucially, expand their existing business), and it's worth up to £275,000.

To qualify, your business has to locate there before March 2022.

Businesses are also eligible for  what are termed '100% enhanced capital allowances'  (That's a good old tax exemption to everyone else).

As long as the plant and machinery is bought before November 2023, all the large spending on plant and machinery (up to 125 million Euros) can all be offset against tax your business has to pay elsewhere.

That's quite a tax break.

Like an ISA wrapper shelters interest and capital gains from tax for individuals, so an Enterprise Zone wrapper offsets what you spend on machinery against other tax you should have been paying.

Better still, there can (and probably will) be 'Local Development Orders' that 'simplify' the planning process and allow automatic planning permissions for certain sorts of development like new industrial buildings or changes to how existing ones are used.

Yes, Dear Reader, you read that right, within the Enterprise Zone, it is possible to put up an industrial building without having to get planning permission for it.

There are other fringe benefits too, like the promise of 'Superfast Broadband throughout the zone.

The promotional blurb for the EZ also says "and, if necessary, public spending" which suggests other public money might be spent to benefit incoming or expanding businesses. We've no idea what this might mean.

So those are the benefits to businesses.

But to help with the costs of operating and running the EZ scheme, it is said to be necessary for Fylde and Blackpool Council planners to agree to move the sports pitches that presently sit opposite the end of School Lane closer to St Annes, and into the green belt, so that houses can be built on the former playing pitch site (i.e. between the existing houses and South Shore Cricket Club Ground)

It's not yet clear whether the cricket ground will move a bit further south as well to leave even more room for houses.

Another main feature of the scheme is a new roundabout (or, as Brenda from Bristol might have said.... "ANOTHER one?") near the end of Division Lane where it joins Queensway.

The plan here is to provide a new road that goes through the airport's industrial buildings, across Queensway (via the new roundabout), and links up with the new roads to be built through the proposed Kensington development and quickly out to the M55.

There's a Blackpool Enterprise Zone website where you can see some very limited information, or you can download the (very large) 'Summary Masterplan' where more devils are exposed from the details within it.

 SO WHAT DOES IT ALL MEAN?

Well, we suspect our readers will already have absorbed our lack of enthusiasm for this scheme from the article above.

The Enterprise Zones at Warton and Samlesbury were expected to produce 4,000 to 6,000 jobs between them.

Warton's masterplan was adopted by Fylde in 2014, and the Order formally creating it dates to 2015, but the consultation document on Fylde's latest revisions to its local plan has been quite sanguine in admitting that at  the Warton Enterprise Zone (where even with the planning and financial inducements to participating businesses)

"The Council is aware that no jobs (zero) have been delivered to date at Warton."

And a consultancy called AMION who were asked to provide their own 'Independent Assessment of the Economic Prospects of Fylde'  produced a report which includes the following:

‘The Enterprise Zones at both Blackpool Airport and Warton are expected to lead to the creation of new employment opportunities in Fylde over the Plan period. There remains though a high degree of uncertainty in terms of the timing, scale and additionality of this impact and it is not considered there is yet sufficient evidence to make a specific adjustment to the baseline forecasts.’

Our own view is that the Blackpool EZ will probably do better than Warton and, if it goes ahead, it is likely to regenerate the land around the former Blackpool International Airport.

But the cost will be twofold for Fylde residents.

Firstly there will be the irretrievable loss of green belt to built development, as the 'exemption clause' allows essential airport infrastructure to be built without planning permission (though we think the question as to whether that can be justified on the green belt is probably a separate decision), and it will also push built development (housing and commercial uses) closer to St Annes.

Secondly, and despite protestations that it will not be the case, we remain  firmly of the view that serious international flights from the airport in the future are a dead duck.

Yes the small propeller aircraft will be able to come and go freely, as will the helicopter services.

And the Red Arrows will still be able to come if sufficient extra fire cover can be organised whilst they're here.

Furthermore, it's just possible that even some Isle of Man and Ireland flights, and maybe to near European places as well, but in our view this scheme kills the prospect of American and long haul flights of the sort that were envisaged when the casino was expected and the Airport got its 'International' epithet. There's simply not enough space on the runway any more.

click the picture for a larger view

We have also heard from some of our readers on the Enterprise Zone proposals.


FIRST IMPRESSIONS
The first reader to contact us had attended the consultation at AFC Fylde last September at which 'the mumbling presenters' had not impressed them.

Our reader came to the view that the proposed new playing fields would be a flood-lit complex intended to attract leisure use of the Enterprise Zone. And even though this would be within spitting distance of the runway, the lights were said not to present a problem

There were proposals for tree-lined boulevards with eateries and lots of leisure use amongst the industry. The old Wellington factories had also been earmarked for gradual redevelopment.

Our reader formed the view that the whole thing was going to take forever and generally seemed to hinge on the new motorway link road being built without which nothing much could commence.

As of last September it was envisaged that the first phase (and apparently the "easy bit" since it is undeveloped) lay to the East. But the new road layout with eastern access to the Enterprise Zone, and an east-west transit route was planned, but all of this all seem to depend on the motorway connection being in place first .


PLANNING MATTERS
Our second reader who contacted us demonstrated a considerable knowledge of the planning side of things, and was kind enough to send a us a copy of the consultation response they had submitted. They also said we could make those concerns more widely known and we are happy to do so. Please follow this link to read  the consultation response from our reader.


So overall, we're not impressed with the Enterprise Zone plan, but the question we cannot satisfactorily answer is "OK then, what would you do to rejuvenate what is essentially a redundant airport?" - and because the houses have been built on Pontins, what we would have done to create regional a transport hub is not possible any more.

We doubt the recently closed consultation will have generated many responses outside the big agencies like councils and so on. And from the limited effort put into it, we thought the consultation was a bit like "well we've got to have been seen to have a consultation exercise" - so counterbalance doesn't expect much startling to come from it.

And with Blackpool Council having re-bought the Airport recently, its chances of getting any planning permissions that are needed must have increased (even though most of the airport is in Fylde Borough). So we suspect the Enterprise juggernaut will probably roll along.

If we hear anything more of interest, we'll bring it to our readers attention. 

Dated:  10 January 2018

 

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