£60m and rising – NW counts cost of ash crisis

THE disruption caused by the volcanic ash crisis has cost businesses in the region at least £60m so far, according to estimates.

Thousands of flights have been cancelled leaving the region’s airports with a massive loss of earnings.

Thomson Holidays owner Tui Travel said the crisis was costing it £5m a day. Its rival Thomas Cook, which owns Airtours, said the impact was £7m a day.

Associated businesses, such as airport shops, taxis and hotels have also suffered along with those dependent on freight services. Manchester Airport alone has an annual net benefit to the regional economy of £1bn.

In addition, businesses of all sizes have been left short staffed with employees stranded overseas. Lucy Goddard of Manchester interior design firm NoChintz has been stranded in Milan after attending an international design show.

“The earliest train she is being told she can get is Friday. She’s been quoted £1,800 taxi fare just to get into France,” said colleague Lisa Ashurst.

Manchester Airport and Liverpool John Lennon Airport could not say how much the crisis, which began last Thursday, has cost them.

Some 700 flights have been cancelled in Liverpool and 2,025 in Manchester affecting 200,000 passengers. Blackpool Airport, which has around 20 daily flights to 19 destinations, could not be reached for comment.

Paul Charles, crisis management expert at Lewis PR, said the European travel industry has lost around £1bn.

Greater Manchester Chamber of Commerce has estimated that the blanket flight restriction has cost businesses across the city £41.5m, or nearly £9m a day. This is on top of the £50m that businesses are thought to have lost as a result of heavy winter snow falls.

The Liverpool Chamber of Commerce and Industry said the cost to Merseyside has been around £18m, or £3.6m a day. Both chambers have taken the Centre for Economic and Business Research’s national daily figure of £230m and calculated a regional figure by using the size of each city’s economy.

Brian Sloan, head of business and economic policy at Greater Manchester Chamber, said: “Apart from the chaos in the travel industry it’s causing problems for many firms, with shipments of raw materials being stuck overseas. We’ve spoken to one firm that has four consignments at the airport and a managing director stuck in Turkey.”

Meanwhile, law firm Pannone has said staff who are unable to return to work will probably not be paid. Jim Lister, head of employment, said: “There is no case law on this but, unless the contract of employment provides for paid time off in the event of ‘extreme unforeseen circumstance’, the answer is probably not.”