Bristol Airport has issued a stinging criticism of Welsh Government plans to invest a further £205m into Cardiff Airport claiming the scale of the proposed subsidy would be unprecedented in the Ƶ airport sector and provide its nearest rival with an unfair competitive advantage.
The Welsh Government, which acquired Cardiff Airport in 2013, said the planned investment over the next decade would be used to support the airport’s diversification strategy in areas such as aviation maintenance, repair and overhaul, general aviation and increasing freight movements. Some of the funding has also been earmarked to attract new airlines and routes, with the aim of increasing passenger numbers to exceed two million annually.
Following a non legally binding assessment of its investment plans from the Competition and Markets Authority (CMA), earlier this month the Welsh Government submitted revised funding plans for the Rhoose-based airport to the Ƶ subsidy transparency database.
In an open letter to the Welsh Government’s Economy Secretary Rebecca Evans - whose portfolio includes responsibility for the airport - chief executive of Bristol Airport, Dave Lees, accuses the Welsh Government of a lack of transparency, with announcements being made prior to the Senedd going into recess.
In a written statement earlier this month Ms Evans, announced plans for a £20m investment, while the following day the Welsh Government lodged with the Ƶ subsidy transparency database plans to provide subsidy support of £205.2m to Cardiff Airport.
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 Ƶ aviation, which is being funded at great expense by the taxpayer.”
Mr Lees added: “We are publicly calling 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.”
His letter adds: “State subsidy will mean there is no longer a level playing field for competition between airports and airlines operating within the Ƶ. This proposal will undermine the confidence on future private sector investment in Ƶ transport infrastructure.”
Bristol Airport said it would be making a separate, formal pre-application request to the Welsh Government for more detailed information on the proposed subsidy.
The airport confirmed it will wait on a response from Ms Evans before deciding on its next course of action. This could see it lodging a legal challenge to the Competition Appeals Tribunal, who would then make a ruling on whether the Welsh Government subsidy amounts to unfair state aid under the post EU Subsidy Control Act.
In the year to February Bristol Airport had 10.7 million passengers, compared to 881,000 at Cardiff. Around 20% of Bristol's passengers originate from Wales.
A Welsh Government spokesman 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 (gross valued added).
“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.”
Along with its £52m acquisition of the airport from Spanish firm Abertis, to date the Welsh Government has provided the airport more than £180m in financial support.
