Lack of Covid Airline and Airport Funding
a Strategic Mistake for Britain
Lack of Covid Airline and Airport Funding
Regarding their ability to earn revenue, few sectors have been as suddenly and violently affected by Covid and the response to it as airlines and the airports they rely on. The UK sits geographically between an Asian and a North and South American working day which, amongst other factors, makes it a business magnet. Culture, history and variety have made the UK a draw for tourists from all over the world.
Travel and visitors are thus disproportionately important to the economy and way of life.
Curious then to see no sector specific financial help from the government in the most recent budget. The Scottish and Northern Ireland executives have offered help to their airports but not a murmur from central government in England for Heathrow, Gatwick and others. We have seen British Airways owner IAG plunge to a £6.2 Bn loss from a £2.3 Bn profit the previous year and Heathrow to a £2 Bn loss with passenger numbers erased to 1970’s levels when the facility and the cost of running it are built on more contemporary data.
Many say that for an island to greatly reduce and control travel in and out by air to limit spread of a virus with many international variants makes sense. Probably true. Nobody could say though that airlines caused Covid or that the choices the government has had to make do not hurt them more than other industry sectors being given generous financial assistance.
This hardly seems a move destined to boost Global Britain. Protecting jobs, fixing the economy and laying the foundations upon which to build a strong post Brexit and Pandemic UK will rely on a buoyant and varied airline sector with the business, tourism and investment they bring. Whilst this seems short sighted at best it more alarmingly appears to be to be an enormous strategic error when considering how to best invest in recovery and remain “Open to Business”. Short term governmental saving becomes the catalyst for longer term challenge. Not a good trade.
It is also worth considering that solid support for travel and airlines now will deliver a disproportionate competitive advantage moving forward. Those business centres and nations that can return to the “New Normal” fastest will enjoy incredible comparative growth. The UK has already stolen a march on vaccines and the rate at which this is being rolled out. Altering tactics with a view to supporting the areas which can provide a springboard for change and advancement in all respects is surely one of the cornerstones of diligent management of a business or indeed a nation. Westminster should be more alive to this fact.
Airlines and our major airports have every right to feel aggrieved. Whether this is driven by basis of their ownership, overseas in the case of Heathrow, where Britain feels financial support should come from elsewhere who knows ? However, the advantage the fantastic facility brings, the jobs provided and the positive national image portrayed are all very much British. This should be front of mind.
Moreover, Britain is an island. In our history we had to become a sea faring nation to witness what was going on elsewhere and the wonders the world has to offer. A strong navy and set of ports were vital. Similarly, today we rely and will continue to depend on the best infrastructure and widest choice of air travel options and routes. We forget that at our peril and it deserves greater support.
