SNP ‘throws good money after bad’ as Prestwick runs up losses of £49m
A TAXPAYER-owned airport is making no money from passenger flights, its bosses have told MSPs.
Prestwick Airport’s chief executive Stewart Adams said an economic review of its services is being carried out but admitted ‘it’s clear that the passenger side of the business does not make any money’.
The Scottish Government saved the airport from going under in 2013 when it bought it for £1, but it has subsequently had to inject around £40million of loans into it because the business has run up huge losses.
At Holyrood’s rural economy and connectivity committee yesterday, MSPs branded the airport ‘unprofitable’ and raised concerns about the amount of public money it is going to swallow.
Mr Adams said: ‘Passenger numbers certainly need to increase but it is very difficult at the moment.’
The committee was told that, if the Government asked for the loans to be repaid, the airport would be ‘wound up’ – although bosses insisted it has a sustainable future.
Liberal Democrat MSP Mike Rumbles said the airport made an operating loss of £25million in the four years before being saved by the Government and has made a loss of £24million in the four years since. He added: ‘It looks to me that the Scottish taxpayer will never get their money back from your airport.’
He continued: ‘This is an unprofitable company, it is throwing good money after bad money. What would happen if the Scottish Government asks for the loan to be repaid?’
Prestwick Airport finance director Ian Forgie said the strategic plan was to return the business to profit, and analysis being carried out would help understand which parts made a profit and which make a loss.
Non-executive chairman Andrew Miller said he believes the airport ‘can have a sustainable future’.
Prestwick’s passenger total in the year to September was 671,860, up 4 per cent on 2016 but a fraction of its peak of 2.4million in 2006.
Ministers bought the airport when its previous owner Infratil failed to find a buyer.
Scottish Labour economy spokesman Jackie Baillie said: ‘These are shocking revelations that once again call into question the Government’s handling of Prestwick.
‘Prestwick Airport has been a black hole for taxpayers’ cash, has failed to pay all staff the living wage and is increasingly reliant on US Air Force sorties and Donald Trump, but it is staggering to hear the airport’s managers have no idea about the profit – or, more likely, loss – of its passenger operations. It is rapidly becoming an airport in name only.’
Scottish Conservative transport spokesman Jamie Greene said: ‘Despite receiving a £40million taxpayer subsidy over six years, it is astonishing to learn that the senior team at Prestwick has never once worked out the profitability or loss of its passenger operations.
‘By their own admission, the prospects of funding new airline customers is increasingly bleak and distant in such a competitive market.
‘The SNP might be happy to write blank cheques but there is a duty on the Prestwick executive board to admit the reality of the airport’s future prospects and focus on those parts of the business which might be profitable instead.’
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