Airlines set to save millions as air traffic control payments deferred
The UK’s airlines could save tens of millions of pounds a month after European governments took steps to allow them to defer payments for using UK and European airspace for 14 months.
The new measures, which were agreed by air traffic body Eurocontrol’s member states, will cover the period between February and May 2020.
In total, the measures are expected to save European airlines up to €1.1bn (£970m) in payments that were due to be made to air traffic controllers.
In February alone, the UK’s ten biggest airlines were due to pay £47.2m for flights in European airspace.
The measures are a much needed boon to Europe’s airlines, which have been devastated by the coronavirus pandemic, which has caused the near complete collapse of the global airline industry.
According to Eurocontrol, daily traffic is down 90 per cent across the continent after airlines were forced to suspend flights and ground planes due to travel bans and border closures.
The UK government holds a 10 per cent share of the vote for Eurocontrol measures, and voted in favour of the relief.
Transport secretary Grant Shapps said: “Deferring these charges will further help airlines, on top of the unprecedented package of economic measures recently announced by the Chancellor, to support businesses through this challenging period.”
Sign up to Morning Wire’s Midday Update newsletter, delivered to your inbox every lunchtime
Tim Alderslade, the chief executive of industry body Airlines UK, said that though the measures were welcome more would have to be done:
“Whilst it will help with short-term liquidity, it only refers to ai traffic control charges for February to May, a period in which global aviation has virtually ground to a halt and charges for airlines would’ve been substantially reduced anyway.
“Further measures, including extending this deferral or ideally waiving charges for the whole year, and doing likewise with other costs like Civil Aviation Authority charges, will also be needed to help get airlines through this unprecedented downturn.”
The announcement comes as the UK’s carriers continue to talk with the government about potential financial assistance to help them through the current crisis.
Chancellor Rishi Sunak has ruled out industry-wide measures, but has said that individual help will be considered on a case-by-case basis after airlines have ruled out any other means of raising cash.
At yesterday’s meeting of the transport select committee, minister Chris Heaton-Harris did not rule out the possibility of the government taking a stake in airlines to prop them up.
The Telegraph reported that Virgin Atlantic was in discussions over a rescue package worth around £500m.