The Opening of Heathrow Terminal 5 (HC 543-i) Transport Committee 7 May 2008

Evidence given by
3.00 BAA Sir Nigel Rudd, Chairman; Colin Matthews, Chief Executive Officer
4.00 British Airways, Willie Walsh, Chief Executive.

Q1 Mr. David Clelland: Again, welcome to the Committee. Could I ask the witnesses, please, to identify themselves for the purposes of the record.

Sir Nigel Rudd: My name is Nigel Rudd. I am the non Executive Chairman of BAA.

Mr Matthews: Colin Matthews, the CEO of BAA.

Q2 Mr. David Clelland: Before we move to questions, is there anything you would like to say to the Committee at the beginning by way of a statement?

Mr Matthews: I would like to, Mr Chairman. Thank you for the opportunity to appear before you today. On the first day of opening of Terminal 5 we apologised for the poor service experienced by many passengers. I repeat that apology unreservedly today. The Committee will want to understand where and why problems occurred, and I will do my best to answer. However, I have directed all available resources towards fixing the problems for passengers, not towards analysing which organisation was most responsible for what went on. Had I invested in pinpointing every fault, less time would have been spent on improvement and I would have damaged the co-operation with British Airways, without which we cannot serve passengers. We have not sought to blame others. Some of the problems were undoubtedly the responsibility of BAA and some were not. I am glad to say that for several weeks our performance at T5 has been good. We hope to announce shortly when the remaining BAA long-haul flights will transfer from Terminal 4. BAA regrets the postponement and its impact on other airlines; however, we believe it is in the interests of all airlines that we do all we can to avoid further disruption. Despite the initial difficulties, I am confident that all of us will have cause to be proud of Terminal 5. I believe T5 is now back on track and will deliver a much-improved experience for millions of passengers each year. Thank you.

Q3 Mr. David Clelland: Were you aware that aspects of Terminal 5 were not ready when the terminal opened?

Mr Matthews: No, I was not. Clearly, with the benefit of hindsight, there where aspects that were not ready.

Q4 Mr. David Clelland: But you were not aware of them at the time.

Mr Matthews: I was not. If you wish, I will detail some of them. I would, however, if you would just give me a moment, say that within a few days of opening the terminal has been operating well, effectively. It has certainly today and in recent weeks been operating well. That, in itself, if a witness to the fact that the building is substantially working. However, there were some problems on early days. If you like, I will happily list some of them.

Q5 Mr. David Clelland: Please do.

Mr Matthews: I think they have been well documented. The one that has been most clearly publicised was a question of lifts' availability. On the first day 28 out of some 275 lifts were not operational. As we stand today, that number is at 17, and by the end of this month will be at four. There are some reasons for that - and I could explain one or two of them if you like - but there are no excuses. I do not seek to excuse it. That is something that should not have been the case and was. There is another category that has received some publicity: the question of toilets. Out of 107 blocks of toilets, seven were not available on the first day, of which one was in passenger areas. A third area to highlight is to do with those parts of the building which are not passenger-facing. Just as when individuals move into a new home, British Airways moving into their new home would of course have hoped that the painting would have been completed. In the non passenger-touching side of the building there were corridors where the painting had not been complete. That, without question, creates a poor impression with BA staff. I understand that and I regret that. However, all of these issues are being rapidly fixed or have been fixed, and as I said at the outset, since very shortly after the opening the terminal has in fact been operating well. There were aspects that were not ready - I apologise for those - but the building in total is working effectively today.

Q6 Mr Scott: Mr Matthews, you said you were not aware of any problems, but it has been reported that in the trials prior to T5 opening there were problems. Were you not made aware of those?

Mr Matthews: I am not aware of those. I will have to say, as I said in my introduction, that I have not yet chosen to invest my time or that of my team in an investigation of exactly who knew what and when, but I was not aware of such reports.

Q7 Mr. David Clelland: When things did start to go wrong, what action did you take to support British Airways?

Mr Matthews: My own personal approach was to put the absolute top priority on fixing matters for passengers. I spent my own time in Terminal 5. I spent it with the operational experts and the technical experts, doing my best to create an environment in which the best people were able to focus on fixing the problem. In my opinion, the most critical aspect of that was making sure that BAA staff could work collaboratively together with British Airways. The extent to which we have done that is the extent to which we have rapidly fixed problems since those early days. My own time was spent in T5, with the operational experts, with the technical experts, working with the individuals to create the quickest possible operational fix for passengers.

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Q80 Mr. David Clelland: What costs will BAA face in terms of service quality rebates?

Mr Matthews: I do not know yet the total cost implications, because we need to not only fix the issue for passengers, we also need to reprogramme all of the moves around Heathrow Airport which take place over the coming years, because T5 is the first in a series of important investments which will transfer all of the terminals for all of the airlines and, obviously, we need to minimise the impact on the other airlines arising from the delay to the transfer of the remaining BA long haul flights. So I am not in a position yet to analyse or answer that question.

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Mr. David Clelland: With that, gentlemen, I am going to have to bring this evidence session to a close, but we look forward to receiving the further written evidence you have volunteered to give us and, perhaps, further discussions with you in due course. Thank you very much for coming along this afternoon.

Witnesses: Mr Willie Walsh, Chief Executive, British Airways, gave evidence.

Q84 Mr. David Clelland: Mr Walsh, good afternoon. Could I ask you to identify yourself for the purposes of the record, please?

Mr Walsh: Thank you, Chairman. Willie Walsh, British Airways Chief Executive.

Q85 Mr. David Clelland: Thank you for coming along, Mr Walsh. Is there anything you want to say in advance of questions?

Mr Walsh: Yes, Chairman, if I may. I am sorry I missed the start of proceedings, Chairman, but I was engaged elsewhere. Could I take this opportunity, please, to pass on how sorry I was to hear of the passing of Gwyneth Dunwoody. I was looking forward to meeting with her today. I had the pleasure of meeting with her on several occasions, both formally and informally. I think she was a great servant to her country and a great servant to transport and I would like to pass on my condolences to her family, friends and colleagues.

Q86 Mr. David Clelland: Thank you, that will be done. I do apologise in advance that we may be interrupted by a division, but we will get that over as quickly as we can and get back. Mr Walsh, was Terminal 5 ready to open?

Mr Walsh: We believed it was, Chairman. We believed that we had prepared sufficiently for the opening of Terminal 5 on 27 March. With the benefit of hindsight, it is clear that we had made some mistakes. In particular, we had compromised on the testing regime as result of delays in completing the building programme for T5 and the fact that we compromised on the testing of the building did impact on the operation at T5 in the first few days after its opening.

Q87 Mr. David Clelland: But British Airways was totally ready for the opening of Terminal 5 as far as you are concerned?

Mr Walsh: Yes, Chairman, we believe we were.

Q88 Mr. David Clelland: How did you go about getting staff on board with the move to the new terminal?

Mr Walsh: Chairman, we had involved all of our staff at the Heathrow terminals in a programme that we called "Fit for Five", which ran over a number of years. This programme was designed to engage staff in the benefits of moving to Terminal 5 and also to engage staff in the need for changes in work practices, in terms of how they operate at Heathrow, with a view to maximising the benefit of the move into a modern, world-class terminal and to provide British Airways with improvement in the standards of service that we offer to our customers and also the standards of efficiency that we operate. In addition to that, we did put all of the staff involved through a programme of familiarisation and training in the new terminal building. I think one of the lessons we have learnt looking back is that, again, because of the delays in completion of the building programme, the training and familiarisation was compromised because, in effect, we were familiarising people in an environment that was not fully complete and, again, having reviewed the operation of T5 in the first few days, that clearly had in an impact on our staff. I would like to record at this point how proud I am of all the staff at British Airways, not just those directly working in the terminal but also the hundreds, indeed thousands, of volunteers from right across the airline who have been working hard to deliver customer service to our customers, often in difficult circumstances. I think they have done a fantastic job and have helped us to recover the very damaging situation that prevailed after the initial opening of T5.

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Q101 Mr. David Clelland: When you say, Mr Walsh, that the staff were not familiar enough with the new facilities, what was the reason for that? Was it insufficient training?

Mr Walsh: I think, again, with the benefit of hindsight, we would have to say that we did not provide them with sufficient training and familiarisation. The programme that we had identified, which generally involved four days of familiarisation and training, was not sufficient, and to some degree that was because the environment in which we provided that was a building that was not fully complete, so to some degree we were showing them around a building that was different when they arrived on day one, and that was clear to me when I arrived at T5 on the morning of 27 March. I was there at 3.00 a.m., just after 3.00 a.m., and I met with some staff. It was regrettable that they had not received sufficient familiarisation to make them feel comfortable in that environment. I think it is important to remember, if you put a staff member in uniform in a brand new environment, people who encounter those staff expect them to know more, and I regret that we put our people in that position.

Q102 Mr. David Clelland: But was there no warning of that? Did the staff themselves or their trade union representatives point out that there was going to be a problem here?

Mr Walsh: I think, to be fair, quite a number of people expressed concerns about various different aspects of it. Many of the things that people expressed concerns about actually worked very well on the day. It is interesting. I have not as yet met anybody who was able to predict the particular problems that we encountered, but, yes, people did express concerns about how this would go, and I think that is understandable given the scale of the change involved. If we were to do it again, we would do things differently.

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Q139 Mr. David Clelland: Have all the problems with the bridges now been resolved?

Mr Walsh: Yes, largely they have. Any problems that we have now are what we call routine issues.

Q140 Mr. David Clelland: What did you put the additional problems down to?

Mr Walsh: It is new equipment. There were issues such as calibrating the equipment, so it required engineers to correct and restart the equipment, but, again, once people become familiar with the equipment---

Q141 Mr. David Clelland: The people who were operating the equipment were unfamiliar with it, is that what you are saying?

Mr Walsh: There was a degree of familiarisation.

Q142 Mr. David Clelland: You thought everything was perfectly okay with the operation?

Mr Walsh: No, there were issues with this operation as well, but it was a combination again. As I said, in the same way as familiarisation impacted operations right across the airport, I think familiarisation impacted on the operation of the air bridges as well, but, in the main, I think they are working as they were designed to work.

Q143 Mrs Ellman: In the very recent written evidence that you have given to us, you say that you will continue to work with BAA to resolve the main problems, including the baggage system and its operation. Could you tell us what the situation is concerning baggage?

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Q145 Mrs Ellman: You have lost two of your directors, the Director of Operations and the Director of Customer Services. Why did they have to go? What had they done wrong?

Mr Walsh: I am sorry, I am not prepared to discuss that at this point.

Q146 Mrs Ellman: You are not prepared to say why those particular people went?

Mr Walsh: No.

Q147 Mr. David Clelland: Or whether it was related to the T5 experience.

Mr Walsh: I think it would be inappropriate for me to discuss that at this point. They are not here to defend themselves, so I think it would be wrong for me to make comment at this stage.

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Q189 Mr. David Clelland: On that happy note, I wish to finish, Mr Walsh. Thank you very much for the clarity of your answers, with the possible exception of the issue of the two directors, but perhaps that might become clear in due course. Our inquiry is on-going and we may have further points of clarification. I am sure you would be happy to co-operate if that were the case?

Mr Walsh: Absolutely.

Mr. David Clelland: Thank you very much for your evidence today.

This is an uncorrected transcript of evidence taken in public and reported to the House. The transcript has been placed on the internet on the authority of the Committee. Neither witnesses nor Members have had the opportunity to correct the record. The transcript is not yet an approved formal record of these proceedings.

The full transcript may be read here.