Flybe rescued in government deal

Regional airline Flybe has secured a rescue deal with the government that will allow it to keep operating.
Flybe planes parked at Belfast City Airport on Monday. The airline has agreed a rescue deal with the governmentFlybe planes parked at Belfast City Airport on Monday. The airline has agreed a rescue deal with the government
Flybe planes parked at Belfast City Airport on Monday. The airline has agreed a rescue deal with the government

Business Secretary Andrea Leadsom said she was “delighted” with the agreement, which came after rescue talks over the weekend.

The airline flies to 14 UK destinations from George Best Belfast City Airport, more than any other airline, and makes up 90% of all flights from the airport.

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A potential collapse could have affected 150 jobs in Northern Ireland.

Ms Leadsom 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.”

Flybe’s shareholders Connect Airways, a consortium including Virgin Atlantic, Stobart Group and Cyrus Capital Partners, will put in more funding as part of the agreement.

The British Airline Pilots’ Association (Balpa) 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.”

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The government has agreed to review air passenger duty following discussions over the rescue, the Treasury said.

A statement said the review will begin ahead of the March Budget and will seek to ensure regional connectivity is “strengthened” while also being in line with the UK’s net zero climate change commitments by 2050.

Chancellor Sajid Javid said: “I welcome Flybe’s confirmation that they will continue to operate as normal, safeguarding jobs in UK and ensuring flights continue to serve communities across the whole of the UK.”

Airlines claim APD restricts connectivity and passenger growth.

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Passengers on domestic flights pay £26 in APD for a return trip, with higher rates for longer flights and premium cabins.

The tax is expected to be worth £3.7 billion to the Treasury in 2019/20.

The deal means Flybe has avoided being the second UK airline to fail in four months, after Thomas Cook went bust in September.

Earlier on Tuesday the head of a NI transport firm had called for the government to step in.

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Jennifer McKeever, director of Airporter – a firm that runs a bus from Londonderry to the Belfast airports – said that Flybe provides an “important service” for thousands of commuters.

“The airline also provides many important connections that are industry-specific – many people in Northern Ireland who work in the oil and gas industries regularly use Flybe routes which are not provided by any other airline,” she added.