Welsh Conservative Shadow Ministers are today calling for the Welsh Government to explain to taxpayers how and why loss-making Cardiff Airport is still funded by the public purse.
In figures revealed by Darren Millar AM, Shadow Minister and Policy Director for the Welsh Conservatives (pictured), Cardiff Airport is shown to be in £30.6million of debt to the Welsh Government as of March 2018, five years after it was bought.
The airport, located in Rhoose in the Vale of Glamorgan, was bought by the Welsh Government in 2013 for £52million after flight numbers had dwindled over the years.
The purchase price was based on forecasts for a growth of up to 2 million passengers per year and underlying profits of around £20million within five years, but by March 2018 there were fewer than 1.5 million passengers and the airport's annual losses have more than doubled.
The £52million price-tag has now almost been matched by £51million of taxpayer-funded loans, grants and losses on projected figures over the five years.
At the time of the acquisition, Welsh Conservatives put to the Welsh Government a blueprint for how the Party would set out to pay taxpayers back the £52million, plus £1millon of consultancy fees paid ahead of the purchase.
The blueprint included the need for better transport links to the airport, impeded greatly this year by the shunning of the M4 relief road project against the will of its inquiry’s author. It also called for the devolution of the air passenger duty tax, which it maintains is essential for the airport – as long as it remains in Welsh Government ownership – to become more competitive with its English neighbours.
Today’s figures show that failure by the Welsh Labour Government to implement a successful plan has seen the airport rack up annually-increasing losses on projected figures of up to £16,000 a day in 2018; caused by poorer than expected flight and passenger numbers. These losses now total £19.8million since 2013.
Shadow Ministers have refuted objections from the airport that it is seeing a boost in flight numbers, because these have started from such a low number.
Andrew RT Davies, Assembly Member for South Wales Central, warned earlier this year of the further damage flight operator Flybe’s decision to end jet operations later this year will have on the airport.
Commenting, Shadow Business, Economy and Infrastructure Minister, Russell George AM, said:
“We’ve known for several years that Cardiff Airport has been a huge drain on the Welsh public purse, but it is clear from these figures that it was overpriced and continues to underperform.
“Wales needs to stay connected but the airport mustn’t be allowed to spiral into financial crisis.
“The Welsh Government’s decision to purchase the site was based on overly optimistic forecasts of passenger growth and profitability which have failed to materialise.
“Ministers also failed to project the benefits that devolving air passenger duty would have had on attracting flight operators and allowing Cardiff to compete fully with the likes of Bristol.”
Darren Millar AM added:
“We all want to see Cardiff Airport thrive but the facts speak for themselves; the airport has cost Welsh taxpayers tens of millions of pounds over the past five years, cash that could have been invested in schools and hospitals instead.
“Taxpayers have already foot an enormous bill for this vanity project. The Welsh Government must act now take to consider all options for addressing these losses and turning the airport around, that should include returning the airport to the private sector."