Aurigny could lose £9.6 million of public money in 2020. The loss is due in part to what is considered to be a disjointed approach to the subsidized carrier’s management.
The Guernsey flag carrier, which provides services between the Channel Islands and mainland Britain, is already £7 million in the red in 2019. The promise of a further £2 million slide has seen the government of Guernsey step up to the plate, again.
According to Bailiwick Express, the state-owned carrier will receive £7 million next year in subsidies, even though only £4 million was budgeted for. All subsidies paid to Aurigny are passed on to the taxpayer.
Gavin St Pier, the President of Guernsey’s policies committee told the Bailiwick Express, “We are beginning to see the financial consequences of a disjointed approach to air links.
“The island has benefitted in some ways with more destinations to fly from, including a daily Heathrow service. But a lack of coordination has arguably resulted, at least in part, to significant losses for Aurigny, which the taxpayer has to cover.”
We have written to Aurigny but have so far received no reply.
Aurigny has been running at a loss since it was bought by the government for £5 million in 2003. Despite its fruitlessness, it is regarded as an essential airline. It provides a vital link to the rest of the Channel Islands, mainland Britain and France.
In 2015, 15 years of debt (amounting to £19.9 million, writes the BBC) was paid off by the Guernsey state. At that point, the government promised to impose sweeping changes. Those included ways to manage the ups and downs of the carrier more effectively.
Re-branding and re-naming were also considered, in an effort to stamp the Bailiwick identity to the brand, and to make the brand easier to pronounce.
“They spend up to £500,000 each year on off-island marketing,” Guernsey Deputy Darren Duquemin told the BBC at the time. “How much of this investment is wasted because of the handicap of what Aurigny admits on its own website is ‘not the easiest of names’?”.
Following the clearing of the debt the airline was expected to turn a profit in 2018.
Clearly, there has been no such undertaking from the States’ government to find a sustainable strategy for the airline. Indeed, the latest announcement of the government’s putting in place a “sustainable air transport policy” looks set to fall on deaf ears.
Gavin St Pier’s explanation of a “disjointed approach to air links” is just one of the numerous causes associated with the mounting losses of Aurigny. St Pier says a lack of coordination and coherency within Guernsey’s system of government allowed, for instance, the £825,000 backing of Flybe’s Heathrow-Guernsey route earlier this year.
Aurigny current flies between the Channel Islands and London’s Gatwick and Stansted airports.
Conflicts of interest aside, Aurigny outgoings have been particularly steep this year. And the trend is expected to continue unabated unless someone can grab the reigns of the island’s air route operation.
According to some observers, the solutions to the crisis do not just come from quasi-re-branding and halfhearted coordination of operations. A further termination of unprofitable routes and daily scrutiny of the carrier’s use of state funds are also vital to the survival of Aurigny.