Bristol Airport hits out at Welsh Government over Cardiff Airport subsidy

Emily Price 

Bristol Airport has hit out at the Welsh Government over a multi-million pound subsidy set to be awarded to Cardiff Airport.

At the start of April, Welsh ministers published a written statement outlining plans for a £20m investment in Wales' only international airport - purchased by the Welsh Government in March 2013.

The Welsh Government said the cash injection was "aimed at growing the local economy further by realising the full potential of Cardiff Airport's presence in Wales."

But the following day, the UK Subsidy Transparency Database showed that the Welsh Government plans spend £205.2 on Cardiff Airport.

[mid-content-banner]

Distort

In a strongly worded letter to Cabinet Secretary for Economy Rebecca Evans, Bristol Airport's Chief Executive Officer Dave Lees said the cash would "would exceed Cardiff Airport's current annual turnover" in each year of the planned 10-year duration and "distort competition between airports and airlines".

He has called on the cabinet secretary "for details to be urgently made available on the proposed subsidy including the benefits it will deliver, what alternatives have been considered, how the impacts have been assessed, in the context of the significant additional cost burden to the taxpayer in Wales."

Mr Lees wrote: "Bristol Airport welcomes competition, but this must be on a level playing field to avoid market distortions. This subsidy could move activity between locations at huge cost to the taxpayer but without any net economic benefit.

"Distorting competition between airports and airlines will lead to higher prices for consumers and unbalanced public subsidies will have a chilling-effect on future private sector investment.

"Bristol Airport is proud to be the primary airport for the whole south west quarter of the UK,
providing connectivity to more than 115 destinations. One in five of our passengers are travelling to
or from south Wales."

[lower-mid-content-banner]

'Assumptions'

He added: "Our role includes supporting the Welsh visitor economy as well as sports fixtures held in the region. We are currently investing £400m of private capital to improve the customer experience, at no cost to the taxpayer.

"The Competition and Markets Authority sharply criticised the Welsh Government for the
'un-evidenced assumptions' made about Bristol Airport’s future growth plans.

"In your most recent Written Statement, you explain that ‘consideration has been given to the Competition and Markets Authority’s assessment’ – yet you have failed to sufficiently engage with Bristol Airport to understand the potential impact this would have on competition for the aviation sector despite repeated requests."

Around one in five passengers at Bristol Airport travel to or from south Wales and to fly to the 115 destinations the airport provides.

The airport says it supports the Welsh visitor economy as well as sports fixtures held in Wales.

Mr Lees said: "It is deeply concerning that major announcements on the proposed subsidy have all taken place immediately prior to holidays and there was again no attempt to re-engage with Bristol Airport, despite repeated requests.

"Furthermore, repeated attempts by Members of the Senedd and others to seek further detail on how Welsh Government intends to respond to the concerns raised in the CMA assessment has also been unsuccessful, resulting in a serious lack of transparency around this unprecedented subsidy in UK aviation, which is being funded at great expense by the taxpayer."

A Welsh Government spokesperson said: "We recognise the importance of Cardiff Airport to the Welsh economy and believe very strongly that, with the right investment, the Airport has the potential to make an even greater contribution, creating hundreds of additional jobs and boosting regional GVA.

"Welsh Government investment will allow Welsh Ministers to focus the strategic direction of the Airport on the delivery of long-term economic growth with a view to realising these benefits.

"We acknowledge the correspondence received from Bristol Airport regarding the subsidy and will be responding as we consider appropriate in due course."