Troubled airline lands Government rescue deal


The government has agreed a rescue plan for troubled regional airline Flybe, Europe’s biggest regional airline and the largest airline in terms of passenger volumes at Birmingham Airport, in a move which would safeguard 2,400 jobs.

The government has agreed to work with Flybe to work out a repayment plan for a tax debt that is thought to top £100m, while the firm’s owners have agreed to pump more money into the loss-making airline.

Flybe tweeted: “We are delighted with the support received from the Government & the positive outcome for our people, our customers and the UK. Flybe remains committed to providing exceptional air connectivity for the UK regions with the full support of its shareholders.”

Business Secretary Andrea Leadsom said the deal would keep the company operating.

She tweeted: “Delighted that we have reached agreement with Flybe’s shareholders to keep the company operating, ensuring that UK regions remain connected.

“This will be welcome news for Flybe’s staff, customers and creditors and we will continue the hard work to ensure a sustainable future.”

The airline had found itself at risk once again less than a year after its rescue by a Virgin Atlantic-led consortium of buyers.

In October, the airline officially changed its name to Virgin Connect following its £2.8m sale to a consortium of operators called Connect Airways, which was led by Richard Branson’s Virgin Atlantic.

However, the chief executive of the owner of British Airways has reportedly attacked the government’s decision to help troubled Flybe as a misuse of public funds.

In a letter to Transport Secretary Grant Shapps, a copy of which has been seen by the BBC, Willie Walsh, CEO of International Airlines Group, questioned why the taxpayer is picking up the tab for the airline’s mismanagement.

He pointed out that one of Flybe’s biggest shareholders Virgin Atlantic, is part owned by the US’s Delta, one of the world’s largest and most profitable airlines.

The British Airline Pilots Association (BALPA) General Secretary, Brian Strutton, said: “This is good news for 2,400 Flybe staff whose jobs are secured and regional communities who would have lost their air connectivity without Flybe.

“BALPA looks forward to discussing the airline’s future plans in detail with management, meanwhile passengers can be confident that Flybe remains an excellent choice for regional flying.

“The Government is to be applauded for stepping up to the plate to help one of the few remaining independent UK airlines and a vital one at that.”

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