Airport ‘ needs public money to stay open’
EXECUTIVES at nationalised Prestwick Airpor t are expecting continued multimillion pound public money support to keep it in existence. Audit Scotland said the Scottish Government’s propping up of the airport in loans has cost taxpayers more than £ 31 million – and that many millions more would be needed to sustain the airport as long as it remains in public hands, our sister title The Herald reported.
Airport directors have an agreement that ministers will not seek repayment of all or part of the loan facility or the interest until at least March 31, 2024 – which directors say will enable the Ayrshire airport to “continue in operation existence for at least the next 12 months”.
Financial papers seen by The Herald confirm that directors believe that support is expected to continue beyond that date “for the foreseeable future”. The losses relate to the £ 43.8m of public money loan support given to the airport which auditors now say are valued at just £ 11.6m.
Loan interest was valued at £ 7.4m but that has been valued at ‘ nil’.
Ministers have so far decided not to recoup any of the £ 50m it is owed in loans and interest from the state- controlled airport to allow it to remain in existence which has led to concern it has sanctioned unlawful state aid.
It comes as auditor general Stephen Boyle told MSPs that there needed to be “improved transparency” around investments made by ministers in private companies.
Scottish Conservative shadow transport minister Graham Simpson told the Public Audit Committee: “Many millions of pounds of public expenditure are being used to support the airport ... But that would have been the case for as long as it remains in public sector hands.”
The airport was taken into public ownership in November 2013 after being purchased by the Scottish Government for £ 1.
The facility, which was put up for sale the previous year by New Zealand firm Infratil, had incurred annual losses of £ 2m.
The Scottish Government has been trying to sell the airport but a preferred bidder pulled out of negotiations in May 2021.
A deal with a second bidder ended after “various concerns” were identified.
Losses relate to the £ 43.8m of public money loan support given to the airport