Aviation leaders have repeated calls for specific support for the sector despite the extension of the furlough scheme until March 31, 2021.
Heathrow chief executive John Holland-Kaye and Airlines UK chief executive Tim Alderslade broadly welcomed the extension, but said it covered only a portion of the cost base of businesses in the industry.
Holland-Kaye said: “Whilst we welcome the extension of the furlough scheme, we are clear that it doesn’t go far enough for an aviation sector that has been on its knees since March. In order to protect an industry that has been one of the hardest hit and will be one of the slowest to recover, sector specific measures, similar to those for other impacted industries are urgently required.
“Part of this is fair and equal treatment of business rate relief. Whilst the chancellor has allowed retailers an alleviation on this bill, it continues to demand airports pay rates at the same level as when there were millions of passengers.”
He added: “The chancellor must also look urgently at the Treasury’s decision to abolish the VAT refund scheme and remove airside tax-free shopping. Failure to reverse this decision will unnecessarily jeopardise thousands of retail, hospitality and travel jobs from January 1. We need to see more action to back up the government’s rhetoric on protecting employment.”
He said: “These requests to the Treasury have been made consistently by the industry for months and today’s announcement is further evidence of a sector, so critical to this country’s economic health, being ignored.
“Whilst the government is keen to point out that ‘we are all in this together’, the hundreds of thousands of families across the UK that rely on jobs in aviation to pay the bills have no other choice than to feel very alone.”
Alderslade said: “This is a welcome announcement and all the more important with aviation now essentially closed following the new lockdown travel restrictions.
“Furlough extension will enable carriers to retain more of the key staff and highly skilled roles that will be essential for when demand returns, but which otherwise would be at real risk.
“However, wage support covers only a portion of the high cost base airlines must cover simply to exist, and carriers face this new lockdown in a far weaker position than when the crisis started in March.”
He added: “Airlines – which have spent the past few months desperately cutting costs and taking on billions of pounds of collective additional debt, urgently need access to further liquidity measures to shore up their balance sheets, and the immediate introduction of a UK testing regime instead of blanket quarantine, to provide much needed certainty for customers so they can travel again with confidence.”