£800K subsidy is madness, says Blue Islands chairman

TAXPAYERS’ money is being used to subsidise airlines whether they want the extra cash or not.
Blue Islands chairman Derek Coates said the blanket States policy of granting airlines a £1.05 concession for every passenger was an inefficient and inappropriate use of islanders’ cash that bordered on insanity.
He has decided to redirect his substantial share to local charity Les Bourgs Hospice.
‘If the government is willing to put money into a dustbin, I’m willing to take it out of the dustbin and put it to a worthwhile cause,’ he said.
He said he had been writing to States deputies, including former ministers Stuart Falla and Bill Bell, since 2005 about the issue.
The £1.05p per passenger concession, which used to be called route development funding, is awarded to airlines operating key routes excluding inter-island flights. But Mr Coates told the States he disagreed with the £800,000 system and did not want his airline to take part.
‘I believe that it is a complete waste of taxpayers’ money - I can see no benefit in it whatsoever,’ he said. ‘I don’t believe the subsidies will encourage new routes - it would be wrong for me to accept funds from the public purse if it would not be of benefit to our island.’ from thisisguernsey)

This man knows his stuff and for our States not to stopped these payments is madness...

And not a lot of people knew that :x

I think there will be moans in the morning saying he had no right to reveal this information..You mark my words..

I bet he is not worried - so much for tranparency......so does that mean our taxes bought Aurigny for the island and now we pay for them to fly us - not once with the fare but twice with the subsidy!!!!!

At the end of the day I would think that if there is a £1.05p per passenger given, the airline would take that into account when fixing prices, if not then they should reduce the landing fees by £1.05 instead.

I'd love to believe that they would play that fair.......as for landing fees I worked in the traffic office many years ago - when we used to get BEA Viscounts as our main carrier. One of our jobs was to charge landing/take off/parking and even in those days (circa 1960)
a Viscount used to be charged somewhere in the region of £19 + to land and the same to take off!!! in the winter months we used to get a Viscount in from LHR with one passenger (SOB) and none on the outward journey to Jersey but the charge was £36 + and the return fare was at that time around £15.00 - doesn't take much to understand why BEA pulled out!!!!

AURIGNY’S managing director has defended Guernsey’s airline subsidy.
The system has come under fire from Treasury minister Charles Parkinson, who described its benefits as trivial and insignificant, and Blue Islands boss Derek Coates, who at first refused to accept it then directed it to a local charity.
Commerce and Employment pays £1.05p for every passenger on key air routes, excluding inter-island.
Aurigny MD Malcolm Hart said the money was key to airlines operating through Guernsey.
‘The route subsidy has played a key role over the years in allowing Guernsey to try and stay competitive in the face of an airport charging structure that is amongst the highest in Europe,’ he said.
‘The subsidy alleviated the ridiculous charge that was introduced to help pay for the new terminal building, but effectively discouraged people further from wishing to fly to and from Guernsey.’
He said the system could probably do with a rethink (from thisisguernsey)

£1.05 a key to get people here to the Islands..utter crap..

It seems that Aurigny are saying that the flight cost on their flights take this £1.05 into account where as Blue Island clearly does not.

Maybe if they pay the subsidy directlt to the Airport it would make more sense

HOTELIERS have joined the ranks of those critical of the way Commerce and Employment subsidises airlines.
Kings Mills Hotels Ltd managing director Ian Walker dismissed as ludicrous the system whereby the department gives airlines £1.05 of taxpayers’ money for every passenger they carry on key routes, excluding those to the other islands.
‘It is a complete waste of money, absolutely useless,’ he said.
For the department to take the total sum of £800,000 and spread it so thinly did not help, he said.
‘It’s a complete dilution. They should use it somewhere else - concentrate it on one element where it will have an effect,’ he said.
He suggested putting the money towards developing new links. He was convinced that in the years the subsidy had been around it had not benefited the island.
‘It has no effect whatsoever - it is ludicrous and it has been in place for too long (from thisisguernsey)

Well he has got a point..

It depends on exactly what the subsidy was suposed to do as to whether it is effective or not.

If the subsidy was supposed to reduce the the cost of travel it should have been given to the Airport direct so that the landing free was reduced.

If it was to encourage visitors to the Island it should only apply on inward return travel with stays of 3 or more nights and then it could have been a higher amount per passenger and be more effective for tourism.