Irish aviation sector may need Covid-19 state support next year, officials say

The Irish aviation sector may need more state support in the event of a pandemic next year after receiving € 521m in such support since the Covid-19 strike as traffic levels are not expected to recover until 2025, government officials predicted in a spending review.

An assessment of aviation supports was part of a series of reviews released by the Ministry of Public Expenditure on Friday.

It says the sustained growth of the aviation sector in the years leading up to the pandemic came to an abrupt end when the coronavirus response halted travel in March last year, with passenger traffic levels at major airports. Irish having fallen by 78% and 94%. below 2019 levels in 2020 and this year respectively.

“To date, 254 million euros have been provided to the aviation sector in the form of sectoral support, while the sector has also benefited from around 267 million euros in support to ‘horizontal’ and non-horizontal companies. sectoral for [the] to finish [of] June, including wage subsidy programs, ”the journal says.

Officials spoke of the prospect of a “two-lane” recovery in the sector, with Dublin airport recovering strongly and regional airports less strongly.

“In the short term, to continue supporting the sector, it may be necessary for access to horizontal business supports to continue in 2022 and may also require additional future funding under the regional airports program, in particular for Cork. and Shannon. [airports],” they said.

As part of the 2022 budget, funding for the regional airports program has increased from € 21 million to € 36 million to facilitate the temporary inclusion of Cork and Shannon airports in the program.

Subsidies

Since the start of the pandemic, airports in Cork, Shannon, Dublin, Knock, Kerry and Donegal have received four grants totaling 64 million euros. Aer Lingus, the former state-owned airline now part of International Airlines Group, received a credit facility of 150 million euros, while 40 million euros were provided to the airport operator d State DAA in the context of a bond issue.

“The majority of countries have granted advantageous loans with low interest rates and / or state guarantees. On the other hand, Ireland has granted to aeronautical companies a considerable number of non-repayable support in the form of grants ”, indicates the review.

In a separate review, officials called for the rationale for the work-cycle tax regime to be reconsidered and found that no records were available centrally on its operation.

“There are no official figures indicating the costs or the use of the program, and the estimates for the two vary widely,” said the authors of this review. “Although a review of census data indicates an increase in the number of bicycle commuters since the program was introduced, the increase is modest given the reported estimates of program use. “

A third review found that total spending on disability supports and special education increased by € 2.4 billion, or 51%, over the past 10 years until last year for reach 7.1 billion euros. The number of people with access to social protection income support during this period increased by 44% to reach 279,757.

The review indicated that future government policy should allow for greater coordination of disability supports for service users. “This would allow media to be more focused, flexible and have the right combination of activation. “

Comments are closed.