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(Clauses 1, 4, 8, 189 and 209, Schedules 1, 23 and 33, and certain new Clauses and new Schedules relating to value added tax)

I thank hon. Members for the breadth, and the brevity, of their comments in the debate, and I shall endeavour to cover all the relevant points in the few minutes available to me. Of course the Government firmly believe—as I think all hon. Members do—that aviation plays a vital role in the UK economy, by which I mean all the UK economy. I have taken on board the regional aspects of tonight's debate. As hon. Members know, recent economic conditions have been difficult for airlines, but the UK remains internationally competitive and there are positive signs for the air industry, as shown by the growth in passenger numbers at major British airports—including Heathrow, but not limited to the south-east of England. I should note that measures in the Budget such as the corporation tax cut help to set a positive background for business. Members will want to note that, in contrast to the tax systems of other countries, the UK does not apply VAT on domestic flights. This Government are therefore firmly committed to maintaining the UK's status as a global aviation hub, but this must be balanced against the Government's general revenue requirements and the need for a fair contribution from the sector towards reducing the deficit. I shall focus the majority of comments on the calls for devolution to Scotland and Wales, as reflected in the preceding debate. The issue of devolution was raised in the consultation on air passenger duty last year as well as by hon. Members today. Indeed, in the recent Committee debate on the Scotland Bill in the other place, the issue of devolved taxes was considered in some detail. One of the questions raised there, as it has been here tonight, was why the Government had acted on APD for Northern Ireland, but not for Scotland or Wales. Hon. Members, including my near neighbour, my hon. Friend the Member for Great Yarmouth (Brandon Lewis), have touched on the fact that Northern Ireland faces a unique challenge, given that it is the only part of the UK to share a land border with another EU member state—one where aviation duty has recently been cut to a substantially lower rate. That is the context in which we have taken the decision to devolve direct long-haul rates to the Northern Ireland Assembly. I thank the hon. Member for Sedgefield (Phil Wilson) for his sensible acknowledgement that this was for economic development reasons. Any decision to devolve APD further, such as to Scotland or Wales, must of course be based on a full examination of the evidence.