UK airlines urge Chancellor to extend furlough scheme

• Jet2 Airways, EasyJet, Ryanair and TUi urge UK Chancellor Rishi Sunak to extend the furlough scheme until May 2022
• When will COVID travel restrictions end?
• British Airways furloughs thousands of staff, including senior managers
• Will the meeting between UK Prime Minister and US President Joe Biden result in a faster restart to travel?

For weeks, airlines had anticipated a summer boom after UK Prime Minister Boris Johnson announced in his COVID lockdown exit roadmap that international travel would restart from May 17th.

However, hopes were dashed when the Global Travel Taskforce (GTT) revealed that just twelve countries would make a feature on Britain’s quarantine-free “green” list, with Portugal the only European destination to make an appearance.

Last week, dismay evolved into fury after the UK government said that it would be moving the holiday hotspot to the “amber” list due to the rapidly spreading Indian COVID variant in the country.

So, what countries are on the UK’s green list?

Current green list countries and territories

During the latest travel announcement, UK Transport Secretary announced that the UK government had revised the green list, which now features:

• Australia
• Brunei
• Falkland Islands
• Faroe Islands
• Gibraltar
• Iceland
• Israel
• New Zealand
• Singapore
• South Georgia and the South Sandwich Islands
• St Helena, Ascension and Tristan da Cunha

For details of what destinations feature on the “amber” and “red” lists, please visit the GOV.uk website.

With just eleven countries on the green list and flights to these destinations suspended due to varying COVID travel rules, UK travel and tourism chiefs are demanding additional financial aid from the British government.

UK airlines push for additional industry-specific financial aid

Aviation bosses from British Airways (BA), EasyJet, Jet2, Ryanair and TUi have said they will need additional industry-specific support to survive another summer slowdown.

The airline chiefs said stop-start COVID travel restrictions and the “overly cautious” traffic light system had “in effect, left them unable to trade” for a second straight summer.

Although international travel has resumed in the UK, British holidaymakers are still being discouraged from travel. Since the May 17th restart, the UK government has tightened foreign travel rules, impacting demand for air travel.

Summer is a crucial period for airlines and airports, as historically, July and August are the two months where the most profit is generated. However, the growing possibility of another summer being lost to the coronavirus pandemic has triggered fears over airline viability and job security.

In a letter addressed to the UK Chancellor of Exchequer Rishi Sunak, Tim Alderslade, the chief executive of the trade body for British registered airlines UK airlines, wrote: “Financial support measures introduced by the Chancellor have offered the sector a lifeline over the past year.

“However, a vast majority of the GBP 7.2BN worth of support for Britain’s airlines has essentially been taken on as new debt. No sector would be able to survive after accumulating so much debt, and given that the sector’s revenues remain near zero, Britain’s travel industry is in a particularly precarious position.”

Mr Alderslade added: “If a meaningful reopening is not possible this summer, ministers will need to provide more economic support to protect travel jobs and ensure airlines have a fighting chance to restart when a return to the skies is possible.”

BA, Ryanair, Jet2 and Virgin Atlantic are also pushing for the Chancellor to launch a series of “targeted economic support measures” to aid the sector and extend the furlough scheme.

As it stands, the highly acclaimed furlough scheme – which has contributed to the wages of approximately 9.4 million people over the past year – will be tapered down to a close on September 30th 2021.

However, uncertainty over foreign travel has given rise to calls for the scheme to be extended until April-end 2022 for aviation workers.

Airlines UK has also urged the Chancellor to extend the repayment period on COVID government loans and introduce a “restart grant” scheme to aid with the cost and maintenance of planes that are not in use.

The letter addressed to UK Chancellor Rishi Sunak also touched upon matters relating to vaccinated travellers. Airlines UK said that fully vaccinated passengers should be allowed to travel without taking a COVID test, which would support the industry’s recovery.

However, sources close to the UK government said this is unlikely with new, emergent strains posing a threat to the domestic situation.

Concerns over delays to international travel come as IAG-owned airline British Airways places thousands of staff on furlough.

British Airways furloughs staff amid growing concern over delays to travel

Flag carrier airline of the UK, British Airways, has placed thousands of employees on furlough just weeks after returning staff who had been on the scheme for over a year.

BA had anticipated a “booming summer season” after ministers announced that travel would be allowed to resume from May 17th, but the new traffic light system for travel has been a thorn in the side for UK-based carriers.

Unlike rivals in the United States and continental Europe, who have seen bookings surge as their relative economies reopen and COVID vaccine rollouts unlock travel, Britain’s more cautious system is weighing on demand.

Britain’s controversial traffic system determines whether a country is safe to travel to base on the COVID-19 situation, vaccine percentage and presence of variants of concern in that destination.

Most countries and territories, including popular holiday hotspots, are currently categorised as “amber”, meaning travellers returning from these destinations must purchase a series of costly COVID tests and self-isolate at home for ten days.

The low number of countries on the “green” list has placed UK airlines at a disadvantage to their European and trans-Atlantic peers. Furthermore, the costs of safety, maintenance, and engineering planes that are not in use are causing significant financial strain.

Although BA had recalled staff in anticipation of a summer boom, it is understood that a significant number of employees were still having their wages paid through Chancellor Rishi Sunak’s furlough scheme.

The UK airline is hopeful that foreign travel will recommence soon but decided to furlough thousands of workers to protect jobs and save cash as the coronavirus crisis continues to wreak havoc.

A spokesperson from the company said: “It’s vital that ministers follow their risk-based framework and reopen international travel as soon as possible, with more low-risk countries, like the US, on its green list at the next available opportunity.”

Airlines UK boss Tim Alderslade has also urged the UK government to consider modifying the traffic light system.

A government spokesman responded to calls for the traffic light system to be revised, stating: “Britain recognises that the industry is facing challenges due to COVID, which is why we created a world-beating GBP 7BN support package to aid the air transport sector.

“We continue to work with the aviation sector to help them navigate the challenges they face and encourage them to turn to the extraordinary package of support measures previously announced by Rishi Sunak.”

However, British airports have warned that the industry could lose GBP 2.6BN over the summer months without any meaningful changes to the traffic light system.

Industry leaders have urged UK Prime Minister Boris Johnson to use this week’s G7 summit with US President Joe Biden to press ahead with plans to set up a joint task force to facilitate trans-Atlantic travel between Britain and the US.

When will travel between the US and the UK reopen?

Currently, travel between the US and the UK is frozen; however, US President Joe Biden and British Prime Minister Boris Johnson have agreed to establish a task force to explore ways for flying between the countries to recommence.

Although airlines have welcomed the news, they are urging both sides to go further to reopen lucrative trans-Atlantic links at this weekend’s G7 summit in Cornwall.

Virgin Atlantic CEO Shai Weiss said: “We urge PM Johnson and President Biden to use the G7 Summit to reclassify the United States as “green”, and repeal the 212F proclamation which currently prohibits travellers from the UK entering the US.”

Meanwhile, lobbying group Airlines for America, representing industry leaders such as United Airlines, Delta Air and American Airlines, stressed that “quickly is the key.”

International Airlines Group CEO Luis Gallego commented: “Vaccinated passengers should be able to travel freely between the United States and Great Britain.

“Given that both countries have impressive COVID-19 vaccine rollouts, and a high percentage of the population is vaccinated, IAG can’t understand why there are travel restrictions in place between the two nations.”

Andrew Crawley, CCO of American Express Global Business Travel, noted that a US-UK travel corridor is one the single most lucrative corner of the global aviation market, highlighting the more prominent presence of premium and business travellers in this sphere.

Mr Crawley said that the continued closure of the UK-US corridor is highly damaging for both countries as the UK-US corner contains vital routes that pump billions of dollars into both economies and support millions of jobs on both sides of the Atlantic.

The most recent hindrance to establishing a UK-US corridor has been the growing spread of the Delta variant, which saw the British government reverse plans to accelerate the reopening of travel.

According to Public Health England (PHE), the B.1.617.2 strain, or the Indian variant, is around 60% more transmissible than the Kent mutation, which was the dominant form of the virus in Britain until earlier this month.

Still, with more than 50% of the UK population fully vaccinated against COVID-19, aviation bosses hope that this will be enough to foster positive discussion between PM Johnson and President Biden.

America is also believed to be in talks with the European Union over re-establishing safe travel links. Several European countries, including Italy, France, and Greece, are already easing COVID entry rules against Americans to boost tourism in their country.

Although the US has not reciprocated the move, EU travel ministers hope to progress on the matter during this weekend’s G7 summit in Cornwall.

Speaking on an Airlines for Europe industry panel Thursday, Deutsche Lufthansa AG CEO Carsten Spohr said that the Biden administration had not made their requirements for inbound travel clear.

Mr Spohr noted that progress between the US and the UK had been disappointing, and it would be “awkward” to have this summit pass “without some comment on the matter.”

The meeting of G7 world leaders officially got underway today, with British PM Boris Johnson opening with a speech, urging nations to “build back better” from the coronavirus pandemic.