Save our airports Boris . . . or risk levelling DOWN to a Little Britain
RIGHT from the start, the UK’s airports have consistently supported measures that protect public health. This is despite knowing the financial pain additional travel restrictions would bring to our businesses.
The past few weeks have been no exception, as we have continued to back the Government’s decision to suspend travel corridors alongside strengthening restrictions at the border.
We agree with the shared goal of ending this crisis and resuming normality as soon as it is safe to do so.
However, there are three areas where it feels we are out of step with the Government.
The first is recognising the true scale of the impact Covid-19 has had on our sector and its ability to recover without targeted support after almost 12 months of no revenues or passengers.
The second is just how critical aviation is to the UK and to the more than one million people employed in our sector.
Th e third is the apparent disregard for the fact that our industry will provide the tools to deliver the Prime Minister’s twin visions for levelling up and creating a Global Britain.
Of course, all sectors feel they need support and that they are a special case.
But airports are critical parts of our national infrastructure and an enabler of Britain’s success. So many other parts of our economy rely on the international connectivity we provide.
Unless the Government grasps the true significance of the role we play, it risks giving away our success and our competitive advantage. The longer we go unsupported, the less likely we will be in a position to help drive the UK’s recovery and to deliver the Government’s manifesto pledges.
From day one we have remained open for critical flights that carry supplies such as PPE, and we are now helping facilitate the vaccine roll-out. We have also supported the repatriation of UK citizens stranded abroad.
To ensure we stay open and provide a vital role in fighting this virus – at the same time as paving the way for a strong recovery – we have had to reduce costs wherever possible. More than 10,000 people working at our airports have already paid for this with their jobs, both from our direct employees and the wide range of airport partners such as ground handlers, airlines and catering companies. This is having, and will continue to have, a hugely negative impact on local communities reliant on our airports for jobs.
The one bill we have not been able to reduce by a penny is that which we pay to the Government. Together, we served 188 million passengers in 2019. Last year, the figure was 20 per cent of that. Standing at more than £335 million collectively, our fixed costs for business rates, policing and air traffic control have remained the same – despite a near complete collapse in demand.
Our airports are unable to diversify like other businesses. And as bosses of the UK’s largest airports, we are collectively making losses of around £50 million a week.
Heathrow has already lost its crown as Europe’s busiest airport. Since the start of this crisis, Manchester, London Stansted, Gatwick and East Midlands have also lost or seen a suspension of direct and critical trading routes.
We are all now in a fight with our European competitors to win these routes back. We know that building trade links requires strong connections. So, unless we rebuild services to t he l i kes o f Canada, Singapore and Malaysia, the UK’s aspiration to become members of i nternational t rade deals will remain grounded.
Without action, this Government will be levelling down and creating a Little Britain rather than a global one.
The Government repeatedly talks of the ‘unprecedented support’ it has given to aviation. Much of this is no different to the support offered to all sectors of the economy.
Most of the costs of running an airport cannot be turned off or turned down, and the furlough Job Retention Scheme has covered less than a sixth of our total costs.
The Airport Support Scheme, which offers less than one quarter off a collective bill of £186 million, was inadequate in November. It now verges on disbelief. It was designed to respond to the pressure we faced in 2020 and fails to consider the impacts of a further national lockdown, the suspension of airbridges and further border restrictions.
THIS lacklustre response from the Government would have been seen as wholly inadequate if the same measures had been offered to rail, Tube and bus operators as they encountered the same loss of passengers.
Germany, France and Portugal have all provided two to three times the level of financial support to their aviation sectors that our Government has given.
The Treasury has a straightforward choice. Last year, supermarkets returned £1.8 billion in unnecessary business rate alleviation after receiving the support whilst recording bumper profits. We ask the Chancellor to revisit the devastating impact on aviation and redistribute some of that money to a sector facing a real threat.
The toll of job losses will only increase unless we work with Government on a roadmap out of this and, in the meantime, agree what fair support looks like while we are prevented from doing business.
The Government cannot have a Global Britain with a grounded and damaged aviation sector. Nor can it have a well connected, levelled-up Britain if we emerge weakened.
And in terms of supporting the global vaccination programme once the UK is protected? Unless they plan on sending supplies via our EU competitors or on sea containers, they need an aviation sector that can take off quickly when that time comes.