A financial lifeline to ensure Exeter Airport can avoid closure is set to be signed off by councillors in Devon this week.
The collapse of airline Flybe and the Covid-19 pandemic has led to a significant loss of passengers at the airport with 96 employees facing redundancy.
Now, East Devon District Council’s cabinet is set to consider series of measures that will relieve the financial burden on the airport. Members are warned that the airport faces an "existential threat" and could close.
Project director Andrew Wood, in his report that is set to go before the cabinet on Wednesday, said: “It is not possible to say categorically that the package of support outlined in this report will stave off the threat facing the airport. But it will help to cushion the impact of the pandemic.”
He adds: “The package of support is in place for the airport to help counteract the impact of the lockdown, promote recovery and chart a course to a more sustainable future.”
The measures include a further deferral of £180,000 business rate relief, forward-funding the airport’s £750,000 share of the Long Lane road enhancement scheme and endorsing the concept of a sustainable aviation cluster centred on Exeter Airport.
The report to the cabinet states that the combined impact of the collapse of Flybe and the COVID-19 pandemic has left the airport in a "fundamentally different place", with passenger numbers this year expected to be between 80% and 90% down for the year.
The airport has clamped down on any non-essential expenditure and 96 employees are facing redundancy. Mr Wood states that the proposal is high risk, but that the airport is a significant employer and economic driver for the area, it had been significantly impacted by the Covid-19 pandemic, and the scale of job losses are unprecedented.
He added: “Passenger numbers at the Airport in May 2019 were 97,000 and in May 2020 the equivalent figure was just 9. From the beginning of the financial year to the end of the July passenger numbers dropped by 99.5% compared to the same period last year.
“As we emerge from lockdown commercial flights have now recommenced from the Airport. But this is nowhere near the scale that might otherwise have been expected with passenger numbers down by 94% during August.
"Whilst some former Flybe routes have been picked up by alternative operators such as Logan Air and Blue Island, other key routes including to Paris and Amsterdam are not currently being operated. The flying programme continues to be further impacted by the uncertainties around quarantine restrictions.”
When Flybe, which accounted for 75% of the passengers numbers at the Airport, went in to administration on March 5, it led to the loss of 931 jobs locally. This was then followed by the coronavirus crisis with passenger numbers down by 94%during August.
His report said that more widely, the Devon economy is not likely to return to pre- Covid-19 levels of performance until 2027 and employment rates will not recover until 2030 without significant investment between local partners and Government.
It added: “This paper puts forward proposals for short term financial support in terms of business rate relief. This will help to cushion the impact of the current situation and potentially also assist in recovering from the loss of Flybe in terms of securing alternative investors/operators.
"Moreover the additional funding from the Enterprise Zone programme for the Long Lane project will enable the scheme to go ahead and facilitate improved public transport and cycling connectivity.
“The most obvious alternative option would be not to provide any form of public sector backed support. The airport does though face an existential threat currently. In the worst case scenario the airport would close. This would lead to further large scale job closures, reduce business rate revenues and also diminish the connectivity of the region.”
