Airport Fees Increase Is Doubled Following Council ‘Incompetence’

airport Mar 2015The Chief Executive of the Steamship Company says he’s “shocked” by the Council’s decision to raise St Mary’s airport landing fees by twice the recommended level.

Rob Goldsmith feels it’s “a knee jerk reaction to compensate for a lack of cost control at the airport.”

Members at Tuesday’s Full Council meeting voted to overturn the Transport Committee recommendation, made two weeks ago, for of a 5% increase in the charges.

Instead, they’ve doubled them to 10%.

That will add around £100,000 to the bill paid by the Steamship Company to use the airport, based on the expected passenger numbers this year.

“We absolutely support the need for St Mary’s Airport to be safe, compliant and viable,” said Rob, “but these further increases have nothing to do with that, especially when the visitor market is growing so strongly.

He said it looked instead like the Council was trying to build up “a substantial financial reserve” without a clear plan on why it’s needed or how it would be spent.

And Rob said there seemed to be “an automatic expectation” that the company, or their future customers, will foot the bill, irrespective of any justification of the need.

Mr Goldsmith says the decision was made without reference to relevant objective data, market context, transparency or consultation, and he believes it’s “fundamentally flawed.”

At Tuesday’s meeting, members heard how the runway resurfacing work had overspent by £560,000. That wasn’t revealed to the Transport Committee just two weeks ago.

The Senior Manager responsible for the work, Diana Mompoloki, told councillors “at the end of the day, the project needed to be completed.”

But they also heard that they could have to pick up that bill if the main funder, the European Regional Development Fund, can’t provide the cash.

With only £38,000 left in the airport reserves, the prospect obviously rattled some councillors.

Cllr Christine Savill said she was “really concerned” about the financial viability of the airport.

That prompted Cllr Steve Sims, the Chairman of the Transport Committee, to propose doubling the recommended increase in fees.

Another Transport member, Cllr Adrian Davis, said he wasn’t aware of all the financial implications and regretted voting for 5%.

It was left to Cllr James Francis to argue against the rise.

James said the passenger figures presented in the Transport Meeting were incorrect and created “a darker picture.”

He felt numbers would continue to rise this year, which would generate more money for the airport anyway.

James also felt that the Authority hadn’t fully explored the efficiency of the airport operations, in an effort to improve costs.

“We need to increase revenue by bringing in more customers” said James.

But Cllr Fran Grottick disagreed. “We can’t make decisions on airport landing fees based on touching wood,” said Fran.

Chairman Amanda Martin said the Council was responsible for running the airport, not for the prices that people pay to come here.

Councillors were also reminded that they’ll need to replace the runways again in twenty years time, and had to start putting money away now to pay for that.

All councillors present voted for the 10% rise, except James Francis and Fraser Hicks, who voted against. Cllr Ted Moulson abstained.

Transport campaign group FRIST say they are very disappointed that the Council has put charges up by 10% instead of the 5% agreed by the Transport Committee.

FRIST is also unhappy that the fees are being hiked to tackle the overspend on the runway works. They say it is “not justifiable that incompetence and uncertainty should damage the objective of affordable travel between Scilly and the mainland, particularly as Skybus had stated that they would not increase fares with the proposed 5% increase.”

Rob Goldsmith says the Steamship Company will now take some time to assess their response, given the significant direct impact on their business.

He says he hopes the Council will reconsider its position “at the earliest opportunity.”

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