Chancellor Rishi Sunak has decided against creating a specific support package for the aviation industry, which is suffering from a collapse in demand due to coronavirus.
In a letter to airports and airlines, he said the Government is prepared to enter into negotiations with individual companies once they have “exhausted other options” such as raising cash from existing investors.
This comes seven days after he made a speech in which he acknowledged that “some sectors are facing particularly acute challenges” and promised to “discuss a potential support package for specifically airlines and airports”.
Airlines have grounded the majority of their fleet and announced job losses and pay cuts after passengers numbers plummeted due to the spread of Covid-19.
This has led to airports suffering from a major drop in revenue.
Karen Dee, chief executive of trade body the Airport Operators Association (AOA), said the aviation industry was “surprised” by Mr Sunak’s decision and will have to “fight on its own to protect its workforce and its future”.
She went on: “While countries across Europe have recognised the vital role airports play and are stepping into the breach, the UK Government’s decision to take a case-by-case approach with dozens of UK airports is simply not feasible to provide the support necessary in the coming days.
“Not only does the decision today leave airports struggling to provide critical services, it will hamper the UK recovery.”
The AOA wanted a support package that included measures such as relaxing regulations relating to mandatory training requirements, extending business rate relief to airports and deferring all aviation taxes for the duration of global flight restrictions.
Virgin Atlantic had urged the Government to offer carriers emergency credit facilities worth up to £7.5 billion, while the British Airline Pilots Association warned last week that aviation companies could begin “winding down” in the coming days without more support.