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Failure of aviation virus deal attacked

Aviation

01 May 2020
 

The labour Party this week criticised the Government for failing to agree a bespoke funding deal to help the aviation sector through the Covid-19 crisis. 

The criticism came as British Airways’ owner International Airlines Group announced plans to make 12,000 BA staff redundant. 

The Government initially promised an aviation sector deal, only to backtrack on the commitment (LTT 17 Apr).

Shadow transport secretary Jim McMahon said: “The Government should have stepped in and done more to protect their jobs. The whole aviation industry is critical to the UK economy. It was always clear aviation needed a sector-specific deal to alleviate the immediate financial pressures that exist, yet the Government has failed to act leaving people without jobs.”

IAG’s letter to BA staff,  headlined ‘Collective consultations – preparing for a different future’, said: “The impact on British Airways and the industry in general is like no other previous crisis we have gone through before. We are now at a critical juncture and must table proposals for structural change so that our business is in a credible position to respond to what will be a challenging and uncertain trading environment for a sustained period of time." 

The aviation sector does not expect to recover quickly. 

Gatwick Airport’s owners said last week they expect it to take three to four years for passenger numbers to return to the levels seen before Covid-19. 

The airport has slashed costs in response to the plummeting passenger demand. On 1 April  operations were consolidated into its South Terminal and scheduled flights were limited to between 14.00 and 22.00. 

The airport’s capital investment programme has been deferred and more than 90 per cent of eligible staff have been put on the Government’s job retention scheme.  

Gatwick has secured a £300m loan from a consortium of banks to improve liquidity.

 
 
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