Economy and Transport

The Flight to Privatisation

Coronavirus has completely changed the landscape of aviation both in Britain and overseas, but smaller airports like Cardiff Airport are still vital in developing a global Britain writes George Moore.

Despite having huge potential, many smaller airports outside of London still fail to live up to their potential, and Cardiff Airport is a prime example of this. In the 2018-2019 economic period, the airport made a pre-tax loss of £18.5 million, and it has consistently underperformed since being nationalised in 2013. In fact, the airport has not reported a single pre-tax profit since. Many of these losses can be attributed to obscenely high expenditures, including administrative expenses which have risen every year since the Welsh Government took ownership in 2013. 

This, simply put, makes Cardiff Airport in its current form a burden on the Welsh taxpayer. Whilst passenger numbers, and routes served have grown since nationalisation in 2013, the recovery from Coronavirus will be tough for the airport, and new, radical thinking will be required to revitalise it. 

During a Senedd debate on Cardiff Airport in March 2020, the Welsh Conservative Shadow Minister for Economy and Transport, Russell George MS, set out a five-point plan for its survival after the loss of its largest airline, Flybe. 

Whilst the entire outlook of global aviation has changed since March, the Welsh Conservative Party plan remains the only credible option to ensure the survival of Cardiff Airport through acting as an attraction for commercial investors. Without a radical plan like this to completely revitalise the way the airport operates, it will continue to make year-on-year losses, and become a further burden on the taxpayer. 

The plan set out in March included:

  • “Supporting route development, prioritising a direct flight link to the USA and to Manchester
  • Developing a new marketing strategy for the airport
  • Improving transport links to the airport to make the airport more accessible by investing in better road, rail and public transport links
  • Investing in the airport’s capital infrastructure to enable the airport to diversify and generate new sources of revenue
  • Working with the UK Government to devolve and then scrap Air Passenger Duty”

This plan to overhaul the way Cardiff Airport works would provide vital value for money for the Welsh taxpayer in the coming years, whilst also making it attractive for an eventual privatisation plan. 

Supporting new routes and developing a new marketing plan would not only provide vital connections to boost the Welsh economy, but also go some way in reducing the huge losses that the airport has seen over the past few years. Indeed, investing in new transport links is vital in ensuring more people have the option to use Cardiff in future. 

Abolishing Air Passenger Duty would also ensure Cardiff Airport could become a competitive force in British aviation as the industry recovers from the Coronavirus crisis. These enhancements set out by the Welsh Conservatives will allow the airport to flourish once again. This, in turn, makes Cardiff Airport an extremely attractive prospect for potential private investors, thus reducing the airport’s reliance on the Welsh taxpayer. 

To truly provide value for money, a push for Cardiff Airport’s privatisation must be made. Once it has stabilised, private ownership can see the airport become a true pillar of a modern Welsh economy. Private ownership will see a true market-orientated approach, and better access to commercial finance, allowing the airport to get creative with future income.

Furthermore, the incentive to turn Cardiff’s loss into a profit will see any private operator incentivised to build a better future for the airport. This will enable true investment in the airport, which should see more routes, more passengers, and thus more money coming into the Welsh economy. Perhaps the most significant benefit of privatisation is ensuring taxpayer money is not spent on a project that the private sector can serve in a more effective and efficient way. For far too long, taxpayer money has been wasted on a loss-making Cardiff Airport, but under privatisation millions could be saved.  

There is still a long road ahead for smaller airports like Cardiff’s, especially given the backdrop of Coronavirus. However, these still have much potential in them. For years, Cardiff Airport has been overlooked by so many, but with the right survival plan, and eventual privatisation, it really can be revitalised. 

George Moore is a politics and international relations student at Cardiff University.

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