Passenger levy could be reintroduced at Cornwall’s airport

The likelihood of Newquay airport ever washing its face financially without the support of Cornish taxpayers is a long way off. That was the message at Cornwall Council meetings this week, writes the Local Democracy Service.

Agreeing to support the running of the airport to the tune of more than £5.8 million over the next year, Cornwall councillors have discussed the possibility of reintroducing a passenger levy to maximise income.

Newquay Airport once had a levy known as the Airport Development Fee (ADF), a £5 charge applied to departing passengers over the age of 16. Cornwall Council officially scrapped the controversial charge ten years later in March 2016 to help drive passenger growth and attract new airline services.

Meetings of Cornwall Council’s corporate finance scrutiny committee and its Liberal Democrat/Independent cabinet heard this week that the airport – which has always struggled financially – is facing extra pressure following the collapse of Eastern Airways and the council’s decision to scrap the subsidised Public Service Obligation (PSO) route to London Gatwick earlier this year.

As a result, Corserv – the council company which runs the airport – will reveal a transformation plan later this year. As well as the commercial development of the surrounding airport estate, this could mean introducing alternative revenue streams such as introducing drones, defence contracts and expanding the offering at Spaceport Cornwall, which is based at the airport.

Corserv’s chief executive Neil Edmond told the finance scrutiny committee on Tuesday (July 28) that the airport needs to have in excess of a million passengers a year to cover its own costs, which will obviously never happen due to its geographical location.

The committee heard that the airport will not be able to run without a subsidy for at least the next four to five years, though it was hoped this could be reduced over time.

Cllr Rowland O’Connor raised concerns that every single day the airport is operating it is adding to financial pressures elsewhere within the council. He also noted the suspension of capital maintenance at the airport, which has been deferred for a year.

“It is absolutely amazing that we are deferring routine maintenance. From an outsider in, I’d be asking what safety implications does that have,” he said.

As part of its recommendations to cabinet, the committee urged that the administration “urgently reviews an airport passenger fee to maximise income”.

Discussing the matter today (Wednesday, July 29), council leader Cllr Leigh Frost said it was something his cabinet would “absolutely look at”.

Cllr Martyn Alvey urged caution, saying that the last Conservative administration – of which he was a part – discussed reintroducing a passenger levy but “kicked it into touch” after deciding it was not a good idea.