NATS' plans for developing its unregulated business are not yet clear

3.33  NATS Services Limited is the subsidiary of NATS that conducts unregulated business activities, such as air traffic control at Airports. It was an objective of the PPP to provide a framework in which the Company could better develop additional business at airports in the UK and sell its expertise and services world-wide. The Airline Group's proposals for NATS made clear that though the Group had plans for developing this business, they would give priority to developing the core regulated business. We are unable to comment on whether development of NATS Services Ltd will make a significant contribution to the financial position of the NATS Group as a whole because we have not seen a business plan for the subsidiary. The Strategic Partnership Agreement between the Airline Group and the Government required an initial business plan to be produced for the whole group by the end of November 2001. NATS told us that their priority has been to stabilise NATS Service's business following the events of September 11th and that a revised business plan for the subsidiary is being prepared for Board approval. A factor in the delay in producing this business plan is the extent to which management time has been diverted by managing the financial constraints on the business.