Thursday 10 June 2021 12:01 am

Airlines bid for furlough to be extended until next May

The UK airlines industry has called on the Treasury to extend furlough for sector workers until the end of April next year as the wait for the lifting of travel restrictions goes on.

After weeks of speculation, the industry’s hopes were dashed in May when the government revealed that just 12 countries and dependencies would be on the UK’s quarantine-free travel list.

And last week dismay turned to rage when ministers elected to remove Portugal, the one large holiday destination, from the list due to a rise in Covid-19 cases.

Now airline bosses are demanding more financial help from the government in lieu of a situation that leaves them “still in effect unable to trade” for a second straight summer.

In a letter to Chancellor Rishi Sunak, Airlines UK boss Tim Alderslade said: “The economic support measures that you have put in place during this crisis have undoubtedly been essential for our sector as revenues have remained near zero for over a year.

“However, the bulk of the Government’s headline £7.2bn of support for UK airlines has essentially been taken on as new debt, compared to a little over £1bn in direct furlough support.

“No sector would be able to continue to accumulate debt in this way for much longer and hope to be able to recover, and critically also be in a position to invest as planned in delivering sustainability objectives, when able eventually to trade again.”

He then called for targeted support for the sector, including the continuation of furlough, and extension of repayment terms for any Covid loans, and a new grant scheme for airlines.

In addition, Alderslade called for the traffic light system to be adjusted on 28 June “if the government is serious about driving economic recovery”.

A government spokesperson said: “We recognise the challenging times facing all sectors of transport as a result of COVID-19, which is why we have put in place a world beating support package, including around​ £7bn of support benefitting the air transport sector.

“We continue to work with the aviation sector to help them navigate this difficult time, and encourage them to draw on the unprecedented package of support measures previously announced by the Chancellor.”

The letter came as Boris Johnson and Joe Biden agreed to set up a taskforce to look into the restart of UK-US travel as part of a new “Atlantic Charter” between the two nations.

Airlines welcomed the news, saying it was a “first step”, but said the two nations should go further at the weekend’s G7 summit in Cornwall.

Virgin Atlantic chief exec Shai Weiss said: “We urge Prime Minister Johnson and President Biden to use the G7 Summit to move the US to the UK’s “green list” and repeal the 212F proclamation for UK travellers to the US immediately, and no later than the 4 July.”

Earlier today the UK’s airports warned that they could lose £2.6bn over the summer months if no meaningful changes to the “green list” were made.