Published: Tue, January 14, 2020
Markets | By Otis Pena

UK cabinet ministers to discuss Flybe rescue package

UK cabinet ministers to discuss Flybe rescue package

Andrea Leadsom and Grant Shapps will meet Mr Javid on Tuesday to discuss whether a £100 million tax payment can be deferred until 2023, according to Sky News.

Belfast City Airport declined to comment but did say it was "business as usual for Flybe" at the airport.

The plan is said to involve Flybe deferring this year's estimated air passenger duty (APD) bill of £106 million for three years, giving it the chance to survive the tough winter trading conditions.

Established in 1979, Flybe is Britain's largest regional air carrier, operating more domestic flights within the United Kingdom than any other airline.

Last February, the airline was bought by a consortium led by Virgin Atlantic following poor financial results.

The Exeter-based airline said it would not comment on "rumour and speculation", and continued to advertise tickets in its January sale.

But, according to Sky News, Southend airport owner Stobart and fellow investor Cyrus Capital Partners have expressed reservations about investing so much money in the airline over the coming years.

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Flybe carries an average of eight million passengers every year and employs approximately 2,000 people, all of whom would lose their jobs if the airline were to collapse.

'Large numbers of Flybe's routes provide important transport connections to and from parts of the United Kingdom where other viable options don't exist.

This means those stranded overseas could be forced to book alternative transport and will not necessarily be covered for any losses.

If Flybe fails to secure financing, it could prompt the second collapse of a major airline in the United Kingdom in less than six months.

Flights operated as normal on Monday.

Brian Strutton, general secretary of pilots' union Balpa, said Flybe plays "an incredibly important role connecting the regions and nations of the United Kingdom and onwards to Europe".

GMB national officer Nadine Houghton said: "If Flybe goes belly up, it won't just be direct employees at risk but 1,400 supply chain jobs as well". Our economy is tanking. We have a right to be consulted and the staff have a right to know what is going on'.

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