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Outrageous, says Govt
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The Government said last night that it notes Monarch?s decision to discontinue the successful service it had developed between Manchester and Gibraltar, which operated with a load factor of over 75% in 2005 and which carried over 26,000 passengers in each direction. The airline is perfectly free to take whatever commercial decisions it deems advisable or necessary for commercial reasons.
The Government says it was aware for some time that Monarch did not consider the route viable in the way in which the airline was operating it, notwithstanding that the airline knew from the inception of the route what the operating costs to Gibraltar are.
"The Government takes strong objection to the attempt by Monarch to blame the discontinuation of the route on supposed procrastination or dithering on the part of the Government or on the assertion that it was for the Government to put forward proposals to reduce the operating costs for airlines servicing Gibraltar," says a statement. "The Government considers this totally outrageous. Operating costs at Gibraltar airport such as landing charges are not set by the Government but by the MOD. The Government has always sought to assist airlines wishing to discuss the MOD?s operating costs with the MOD, in order for them to receive as sympathetic a hearing as possible.
Indeed, since Monarch approached Government in September 2005 on the subject of the Manchester-Gibraltar service, the Government has spent many hours listening to Monarch and engaging in dialogue with the MOD on the airline?s behalf. The Government has had various meetings with the Commercial Director of Monarch, Mr Jonathan Crick, in both Gibraltar and UK, to discuss this matter. This assistance is considered by Monarch?s scheduled services Managing Director, Mr Tim Jeans, to have been ?dithering?, something which is patently untrue, although it is certainly true that Government has not submitted to Monarch?s financial demands. Mr Jeans may not have been fully briefed by Mr Crick.
The Government had not heard about or from Mr. Jeans until about a week ago. He is completely new on the scene of Monarch?s extensive dialogue and relations with Government.
The Government adds that it is not prepared to directly assist airlines with their operating costs to Gibraltar, by subsidising their operations. This would in any case be in contravention of EU state-aid rules.
Monarch were seeking a reduction in landing charges, which are not within the Government?s control, and a reduction in passenger departure tax which is within the Government?s control. However, departure tax is paid by departing passengers and not by the airline, so the Government fails to understand why the airline sought this reduction, unless this was a smokescreen for the MOD?s increased landing charges.
The alternative approach when faced by higher operating costs such as landing charges was for the airline to have increased the cost of an air ticket, something which they have chosen not to do.
It has never been the role of the Government to make suggestions to the airline on how to reduce the high cost of operating to Gibraltar. The discontinuation of the Manchester-Gibraltar service is exclusively as a result of a commercial decision taken by the airline, after taking account of the MOD?s scandalous increase in landing charges, for which the Government is not responsible. To suggest otherwise is mischievous and misleading.
The Government notes Monarch?s statement that, while the Manchester service is being discontinued because the Government has procrastinated and dithered about lowering the high costs of operating to Gibraltar, the Luton flight is unaffected. The Luton flight has the same Gibraltar generated operating costs as the Manchester flight.
Finally, the Government believes that its discussions with other airlines will result in the Manchester service being resumed in the not to distant future, said the Government.
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