Report on financial viability of Prestwick Airport to be kept confidential by government

A taxpayer-funded  report on the future viability of Prestwick Airport will not be published, to protect commercially confidential information, despite at least £5 million of public money having been pledged to ensure its survival.   This has led to accusations that ministers are expecting “blind faith” from the public when it comes to justifying spending taxpayers’ money. The report follows a review that took 3 months. The airport has been losing millions of pounds under its previous owners. Although the full document is being withheld, Deputy First Minister Nicola Sturgeon is expected to report key findings to the parliament’s Infrastructure Committee in June. The Scottish Government bought Prestwick for  £1 in November 2013.  Labour’s infrastructure spokesman has said it was unacceptable for the report to be kept secret, and the public deserves to know how the £5 million will be repaid.  The CEO of Edinburgh Airport, Gordon Dewar has claimed Government ownership of Prestwick was distorting competition in the Central Belt of Scotland. . Glasgow Airport chiefs are also said to be uneasy over the arrangement. Prestwick lost £9.7 million last year.

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Report on viability of Prestwick Airport to be kept confidential

A TAXPAYER-FUNDED report on the future viability of Prestwick Airport will not be published, despite at least £5 million of public money having been pledged to ensure its survival.
 

The full report by a senior finance executive into the long-term options for the publicly owned South Ayrshire hub is being withheld to protect commercially confidential information.

It has led to accusations that ministers are expecting “blind faith” from the public when it comes to justifying spending taxpayers’ money.

Romain Py submitted his finished report two weeks ago on the future of the airport, which lost millions of pounds under its previous owners, following a review that took three months.

Although the full document is being withheld, Deputy First Minister Nicola Sturgeon is expected to report key findings to the parliament’s Infrastructure Committee in June.

Mr Py’s recommendations will also influence another Government document that will outline ministers’ “strategic vision” for the troubled Ayrshire airport, which the Scottish Government bought for £1 last November.

But Labour’s infrastructure spokesman James Kelly said it was unacceptable that Mr Py’s report would not be made public.

He said: “So far at least £5m has been committed to Prestwick Airport and the public deserves to know how this money is being invested and when it will be returned to the public purse.

“The Scottish Government cannot justify keeping taxpayers in the dark when their money is being spent on a project with no clear strategy in place. They are asking people to put blind faith in their actions on Prestwick without being prepared to put all the facts on the table.

“Nicola Sturgeon has paid scant disregard to parliament on this issue. She needs to publish this report and come to parliament urgently so that there is a clear and transparent debate about the how the airport is being taken forward.”

The chief executive of Edinburgh Airport, Gordon Dewar, recently claimed Government ownership of Prestwick was distorting competition in the Central Belt. Glasgow Airport chiefs are also said to be uneasy over the arrangement, while Glasgow Chamber of Commerce (GCC) has previously appealed for reassurance the takeover will not have a detrimental effect on Scotland’s second-busiest airport.

GCC chief executive Stuart Patrick said Ms Sturgeon had assured the Chamber in March that, while they would not be able to see Mr Py’s full report, the “strategic vision resulting from the report would be published”.

Mr Patrick added: “Irrespective of the issue of commercial confidentiality, we are clear that the Scottish Government has said it is committed to sharing the strategic priorities that will result from the completion of the business plan. We wait for that as soon as is practically possible.”

Alex Johnstone, Conservative transport spokesman and a member of Holyrood’s Infrastructure Committee, said he expected Ms Sturgeon to provide the panel with a robust account of Mr Py’s findings. He added: “We certainly need to know what’s in that report so that we have a realistic view. We all want to see Prestwick return to the glory days, but the route between where we are now and that achievement is going to be a long and hard one.”

The Scottish Government stepped in to save the airport from closure after New Zealand owner Infratil failed to find a commercial buyer. Accounts have since shown it was running at a pre-tax loss of £9.77m in the 12 months to March 31, 2014.

A Glasgow Airport spokesman said reassurances had been received last year that the Government’s plans for Prestwick would not damage any other airport.

A spokesman for Transport Scotland said: “Our senior advisor has completed his work at Prestwick Airport and we are currently considering his recommendations. The Deputy First Minister has committed to providing the Scottish Parliament with a further update on progress at Prestwick Airport when she appears at the Infrastructure and Capital Investment Committee next month.”

link to article 

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Earlier news about Prestwick airport:

 

Prestwick Airport reveals spiralling losses – almost £10 million in 2013

March 7, 2014

The full scale of Prestwick Airport’s financial problems are revealed in the latest accounts, which show a pre-tax loss of almost £10 million in its final full year of private ownership. Its financial problems have escalated with a pre-tax loss of £9.77m in the 12 months to March 31, 2013. The airport made a £2.3m pre-tax loss in the year to March 2012. Last March its owners, Infratil, put the airport up for sale, but as no buyer could be found, the Scottish Government stepped in and bought Prestwick for a £1 on November 22 2013. Prestwick had a 20% fall in the number of passengers in July 2012 compared to the same month in 2011 – the busiest time of the year with the school holidays. The airport’s accounts state that Prestwick is only a going concern if its owner is willing to continue funding deficits. Such an undertaking has been made by Transport Scotland on behalf of Scottish ministers ie. public subsidy. Only Ryanair is operating scheduled flights, and a significant percentage of the airport’s aviation revenue is derived from freight and other aircraft activity.

Click here to view full story…

 


 

Prestwick Airport to be sold to Scottish Government for £1 – and other failing regional airports look to business parks and housing

12.11.2013

Infratil, which currently owns Prestwick Airport, has said the airport is expected to be sold to the Scottish Government for £1.  The sale is due to be completed by Wednesday, 20 November. Infratil said the airport’s value had been “fully impaired” – effectively written off – after Prestwick and sister airport Manston in Kent were collectively valued at £11 million in March.  Infratil bought Prestwick from Stagecoach in 2001 for £33m.  Manston is being sold to Stagecoach founder Ann Gloag for an expected £400,000. Scottish Ministers are taking over Prestwick airport, which is losing £7m a year, to avert its closure and safeguard 1,400 jobs, including 300 at the airport. Infratil described its investment in the airports to have been “unsuccessful for Infratil” and that while such regional airports looked like a good investment 5 years ago, they now are not as  they are reliant on “robust air traffic growth driving demand.” Other failing airports are looking to  create business parks on their land, and housing – to try and make money out of them.                                 http://www.airportwatch.org.uk/?p=18387 

Glasgow Prestwick Airport may be given to the Scottish Government for nothing

October 11, 2013       The owners of Glasgow Prestwick, New Zealand company Infratil, have suggested they may give away the airport for nothing. The Scottish government has announced it is negotiating to buy the unprofitable airport, and hopes to conclude detailed negotiations with the company by 20 November. Scottish government said it was the “only realistic alternative to closure”. In a statement on its website, the company said it did not expect any transaction “to give rise to material proceeds”. Prestwick was put up for sale last March after heavy annual losses. Several investors expressed interest but no offers were made. Infratil has also been trying to sell its other unprofitable UK airport, Manston. In May 2013, Infratil announced that it had written down the value of both airports to £11m. Infratil has agreed to ensure the airport is kept fully open and operational during the negotiation process. In 2012 Prestwick had around 1 million passengers, compared to 2.4 million at its peak in 2005.      Click here to view full story…

 

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