It is finally taking a long-awaited report to the States, published yesterday, which revealed that it would not pursue the project, and instead seeks to pass the responsibility to the States’ Trading Supervisory Board.
‘This is neither the day nor the hour to spend significant amounts of public money on a project with some benefits, but not without risk to our islands’ overall connectivity,’ said Economic Development president Neil Inder.
‘Ultimately, the majority view of the Committee for Economic Development is that any decision to extend the runway at Guernsey Airport should be driven by the States’ Trading Supervisory Board, taking into account the analysis and supporting reports presented in this policy letter.’
The committee’s approach will not come as a surprise to most. It has been hesitant to commit to a runway development
Deputy Inder committed to an open and transparent conversation over the controversial proposal to extend the runway to 1,700m, and the policy letter sets out potential economic benefits and costs, and the wider impact on strategic air connectivity, public finances, and Aurigny.
Economic Development commissioned a cost-benefit analysis report which concluded that an extended runway could see fares cut by an average of 39%, and could attract an extra 20,000 visitors a year.
It built on that work to estimate that a runway extension could deliver total net economic benefit to the local economy of more than £100m. over 40 years.
But that work would cost £79m. with a further £23m. to upgrade the terminal. Airport fees would have to drop and so the airport’s finances would suffer, and a new entrant in the market could make trading very difficult for Aurigny, especially if the new operator wanted to run to Gatwick, the island’s most profitable route, and even hit Condor’s finances.
The committee’s agreed view is that any decision to extend the runway at Guernsey Airport should be a commercial one, taken by the States’ Trading Supervisory Board.
It said that STSB should take account of its research and findings ahead of the next planned resurfacing of the Guernsey runway – expected to take place within the next five to 10 years – to allow the extension decision to be considered as ‘a coherent overall investment decision’.
Deputy Simon Vermeulen, who used to work in the hospitality sector, does not agree with the rest of the committee.
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