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IAG submits complaint to the EU over Flybe rescue plan
IAG has submitted a complaint to the EU Competition directorate about the ‘state aid’ given to Flybe.
It comes after the airline group’s outgoing chief executive, Willie Walsh, wrote to the UK’s transport secretary Grant Shapps calling the government’s rescue of Flybe a ‘blatant misuse of public funds’.
Walsh said the taxpayer was picking up the tab for the mismanagement of the airline.
The terms of the deal were not disclosed but it is believed Flybe was granted a three-month extension to pay its Air Passenger Duty bill of around £100 million, plus a possible government loan and a cash injection from investors.
Flybe was sold last year to a consortium led by Virgin Atlantic for £2.2 million. They are understood to have promised to pump £100 million of fresh equity into the airline if the government agreed a plan to ease its immediate cashflow crisis.
EasyJet and Ryanair have also voiced their opposition to the government’s actions.
EasyJet chief executive Johan Lundgren said: "Taxpayers should not be used to bail out individual companies, especially when they are backed by well-funded businesses."
Ryanair called for more ‘robust and frequent stress tests on financially weak airlines and tour operators so the taxpayer does not have to bail them out’.
Analyst
Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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