UK government to aid airports due to tightened COVID-19 rules
Due to new travel restrictions, which came into force on January 18, 2021, the Aviation Minister of the United Kingdom announced a financial aid scheme for UK airports, after the industry had called for immediate support. Some of European airports have already received financial support.
“The Airport and Ground Operations Support Scheme will help airports reduce their costs and we will be aiming to provide grants before the end of this financial year,” said UK Aviation Minister, Robert Courts.
The Airport and Ground Operations Support Scheme will help airports reduce their costs and we will be aiming to provide grants before the end of this financial year. Further details to follow soon. 2/2 @transportgovuk— Robert Courts MP (@robertcourts) January 16, 2021
The decision to provide financial aid to UK airports came immediately after the UK's Airport Operators Association (AOA) called for government support, as more stringent COVID-19 rules were decided to be applied.
The UK’s AOA said that without government aid the airports would not be able to support vital and critical services, including freight, emergency services, military and Coastguard flights.
“The closure of travel corridors is understandable from a public health perspective but this adds to the current near-complete shutdown of the UK’s airports, which are vital for our post-pandemic prosperity. This is making a devastating situation for UK airports and communities relying on the jobs and economic benefits that aviation brings, worse,” UK’s Airport Operators Association chief executive Karen Dee said.
Gatwick Airport (LGW), the second largest airport in London, said the financial aid would support and keep airport jobs, as Gatwick Airport is currently facing large traffic reduction amid new travel restrictions.
We welcome tonight's news of an Airports and Ground Operators Support scheme from the UK Aviation Minister.— Gatwick Airport LGW (@Gatwick_Airport) January 16, 2021
This scheme will help protect on-airport jobs as Gatwick sees a large reduction in passengers due to current travel restrictions. https://t.co/JJQTlHaKB3
From January 18, 2021, people travelling to the United Kingdom will have to show proof of negative COVID-19 test. Even with the new testing requirements, travelers must self-isolate for 10 days.
However, the UK government is not the first to provide aid to cash-strapped airports across Europe. Some of the European Union countries have already submitted aid schemes to support their airports under Temporary Framework rules by European Commission, which enables European governments to support companies affected by COVID-19 crisis.
In December 2020, the European Commission authorised a €29.8 million Slovak aid scheme to compensate airport operators for the damage suffered due to the COVID-19 outbreak. The aid, in the form of direct grants, consists of three measures: a damage compensation scheme, an aid scheme to support the airport operators, and an aid scheme to support the uncovered fixed costs of these companies.
In November 2020, the European Commission has approved, under EU State aid rules, approximately €4.4 million Romanian aid scheme to compensate Romanian regional airport operators for the damage suffered due to the COVID-19 pandemic. The Romanian authorities were able to compensate those airports for the net losses suffered during the period between March and June 2020.
In November 2020, the European Commission approved a €22.2 million Cypriot aid scheme to support Hermes Airports Limited, an airport operator of Larnaca and Paphos international airports affected by the COVID-19 outbreak.
In September 2020, the European Commision authorised an aid scheme to support Danish airports. The schemes were approved under the State aid Temporary Framework. The airport aid scheme, with a budget of €4 million, will be open to all Danish airports serving scheduled passenger flights within and to and from Denmark.
In September 2020, the European Commission has approved, under EU State aid rules, approximately €32 million Polish aid scheme to compensate airports for the damage suffered due to the COVID-19 crisis. Under the scheme, the Polish authorities were able to compensate airports for the revenue losses suffered during the period between March and June 2020.
In August 2020, European Commission authorised an aid scheme to support German airports partly under Temporary Framework. Under the scheme, German authorities were able to either compensate airports through direct grants for revenue losses directly caused by the COVID-19 crisis or provide liquidity support in the form of grants, loan guarantees, subsidised interest rates.
Airports Council International (ACI) Europe
In November 2020, Airports Council International (ACI) Europe called on the European Commission (EC) to adopt EU Recovery Framework for Aviation and for Governments to provide the funding to support airports.
According to ACI Europe, airports, unlike airlines, do not get advance revenues as they are only paid after the service is provided and their facilities used. In contrast to airlines which have benefited from more than €31.8 billion in financial aid from European Governments, the support extended to airports has so far remained limited – reaching €840 million.
“Large scale job losses and insolvency are no longer worst case projections for Europe’s airports. We’re already looking down the barrel of the gun, and the crisis continues to deepen,” Olivier Jankovec, Director General of ACI EUROPE, said in a statement on November 4, 2020.
The European Commission has extended its Temporary Framework, which enables European governments to support companies affected by COVID-19 crisis, until June 2021. However, ACI Europe believes the measures are insufficient for the cash-strapped aviation sector, especially airports. Therefore, ACI Europe suggested prolonging the Temporary Framework to the end of 2021 and supplementing it by Recovery Framework for Aviation.
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