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Consultation for the Policy and Financial Management Review (PFMR) of Highlands and Islands Airports Limited (HIAL)

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2 What is HIAL?

2.1 HIAL is owned by the Scottish Ministers. It is a Scottish Public Corporation. The Company's basic remit from the Scottish Ministers is to maintain and operate its 11 airports, 10 in the Highlands and Islands and Dundee Airport, in an efficient and safe way. In fulfilling its responsibilities as airport provider, employer and supporter of employment, HIAL also plays a pivotal role in improving the socio-economic conditions for residents of the Highlands and Islands. It follows therefore that it has a close working relationship with local authorities, Highlands and Islands Enterprise ( HIE) and the local enterprise companies as well as local businesses.

2.2 Together with HIE, the Company conducted an economic impact evaluation of Inverness Airport in 2005 and is currently considering the potential for further collaboration on the economic significance of all its airports. Through the Inverness Airport Business Park initiative, HIAL is working with others in a joint venture partnership. HIAL also works closely with the Scottish Government in seeking to improve the network of air services serving the Highlands and Islands.

2.3 The Company has an important relationship with local authorities and Regional Transport Partnerships. There is a shared interest in pursuing improvements to strategic transport services and infrastructure in the Region.

2.4 HIAL must operate within the commercial aviation sector in terms of competing with other airports for airline business. HIAL seeks to collaborate and work closely with the airlines to catalyse route development and accommodate their objectives in the region. Much of the growth in passenger numbers since 2000 can be attributed to new commercial relationships resulting in route development (often supported by the Route Development Fund).

2.5 Tourism is a significant contributor to the strength of the Highlands and Islands economy making HIAL's role fundamental to the interests of VisitScotland. The Company works closely with VisitScotland's network offices covering Argyll, the Highlands, Orkney, the Outer Hebrides and Shetland. As a high priority, HIAL has worked closely with the Scottish Government and VisitScotland to attract new routes to its airports. The main focus for route development to date has been Inverness Airport - a major tourism gateway to the Highlands and Islands.

2.6 The Company also works closely with the Scottish Government, Highland Council and other local authorities in the provision of the Air Discount Scheme and Public Service Obligation flights in the Highlands and Islands.

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Page updated: Tuesday, July 8, 2008