About 15,000 “ghost flights” left British airports during the first 18 months of the Covid-19 pandemic, figures have shown.
Heathrow topped the list with 4,910 ghost flights, defined as those without passengers or fewer than 10 per cent of passenger capacity, between March 2020 and September 2021.
Manchester Airport came second for ghost flights while Gatwick was third on the list.
The practice has been heavily criticised by environmental campaigners who say the carbon emitted during flights cannot be justified if the journey is unnecessary.
Ghost flights took off from all 32 airports listed on the newly released data. The figures include flights which were operated mainly to transport cargo or repatriate Britons stranded overseas.
In response to a parliamentary question, figures released by Robert Courts, the UK's Aviation Minister, showed an average of 760 empty planes left the UK each month during the period.
The actual numbers may be slightly higher because the data covered only international departures and not domestic flights.
Heathrow endured its worst financial year in 2021 and served its lowest number of passengers in about 50 years.
Aviation rules stipulate that airlines can lose valuable slots if they are not using at least 80 per cent of them.
However, the rules were suspended after the coronavirus crisis hit in spring 2020. But despite the relaxation, airlines flew 14,472 empty planes out of the UK.
“Flights may operate with a low number of passengers for a range of reasons,” Mr Courts said.
“Since the onset of the pandemic, the government has provided alleviation from the normal slot regulations. This means that airlines have not been required to operate empty or almost empty flights solely to retain their historic slots rights.”
Mr Courts released the data after Labour MP Alex Sobel, chairman of the net zero all-parliamentary group, raised the issue.
“To really tackle the climate emergency, we need to ensure that our aviation sector is as efficient as it can be with its carbon output,” Mr Sobel said.
Heathrow chief executive John Holland-Kaye said flights with low passenger numbers were often used to transport cargo.
“If you were flying PPE [personal protective equipment] from China or UK exports into the US while those markets were closed [to leisure travel], you would fly them on a passenger plane and you might only have a couple of passengers on board,” he told the PA news agency.
“Given how tight finances are, nobody is flying a plane unless it is economically viable. This is actually about keeping the UK supply chain going while borders are closed for passengers.”
British Airways and Virgin Atlantic insisted they have not operated “ghost flights” to retain slots during the pandemic.
A Virgin Atlantic spokeswoman said its low-occupancy flights “supported the global movement of people, including returning foreign citizens and repatriated UK citizens, as well as keeping global supply chains running by moving vital cargo, including medical supplies and PPE”.
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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What is a robo-adviser?
Robo-advisers use an online sign-up process to gauge an investor’s risk tolerance by feeding information such as their age, income, saving goals and investment history into an algorithm, which then assigns them an investment portfolio, ranging from more conservative to higher risk ones.
These portfolios are made up of exchange traded funds (ETFs) with exposure to indices such as US and global equities, fixed-income products like bonds, though exposure to real estate, commodity ETFs or gold is also possible.
Investing in ETFs allows robo-advisers to offer fees far lower than traditional investments, such as actively managed mutual funds bought through a bank or broker. Investors can buy ETFs directly via a brokerage, but with robo-advisers they benefit from investment portfolios matched to their risk tolerance as well as being user friendly.
Many robo-advisers charge what are called wrap fees, meaning there are no additional fees such as subscription or withdrawal fees, success fees or fees for rebalancing.
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Our family matters legal consultant
Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.