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<p>The Government is clear that the expansion at Heathrow is not only an opportunity
to protect and strengthen existing routes but to secure new domestic routes to the
benefit of passengers and business across the UK. The Government expects that the
majority of these routes will be viable commercially, as many are today, with support
from Heathrow Airport. This support includes discounted charges for domestic passengers,
and a £10 million Route Connectivity Fund.</p><p> </p><p>The Government will also
take action, where appropriate, to secure routes through the use of Public Service
Obligations (PSOs). PSOs provide the opportunity to offer exclusive rights to airlines
to operate a route. Where this does not deliver the required level of connectivity,
the Government may also offer subsidies to an airline to operate the route, which
includes exemption from Air Passenger Duty.</p><p> </p><p>The Government’s approach
to domestic connectivity will be set out in a Green Paper on the Aviation Strategy
towards the end of this year, and the extent to which subsidies will be required can
only be determined subject to market conditions nearer to the time of new capacity
becoming operational.</p>
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