Cornwall Council: 'Outrage' that 'sale' of Newquay airport is being rushed through

NEWQUAY, ENGLAND - JULY 28: A view of Cornwall Airport Newquay, where Virgin Orbit is seeking to provide launches from a Spaceport using a modified Boeing 747-400 aircraft called "Cosmic Girl", on July 28, 2020, in Newquay, Cornwall, United Kingdom. The British Government has announced the launch of a consultation on the rules governing UK spaceflight and that the Civil Aviation Authority (CAA) is to become the commercial spaceflight regulator. This brings the possibility of the first UK space flights to begin in the early 2020s. (Photo by Hugh Hastings/Getty Images)
Will Newquay airport have a new owner? -Credit:Hugh Hastings/Getty Images

Cornwall Council heard today that there isn't cross-party support for a bid to "sell" Newquay airport, which runs at a loss and will cost the local authority £4.8m over the next year to operate. An opposition councillor said he was "outraged" that the full council won't have a say in the process to find a financial partner to run the 650-acre airport estate.

An extraordinary meeting of the council's economic growth scrutiny committee met today (Tuesday, April 30) to discuss an "airport strategic review" to find a partner to take financial pressure off the council, which subsidises the airport to the tune of around £4m each year. The 2024/25 subsidy is likely to be in the region of £4.8m - £4.5m of which is the cost of regulation, including air traffic control and the airport's fire service.

Cornwall Council owns and operates Cornwall Airport Newquay and manages the wider estate, which includes Aerohub Business Park, the Spaceport, Kernow Solar Park and 200 acres of undeveloped land. The airport served 440,000 passengers in 2023/24 and brings in around £72m to the Cornish economy annually. However, it has continually run at a loss in the 20 years the council has run it, due to operational costs.

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It is anticipated that a decision on whether to proceed with a preferred airport estate partner will come to ruling Cabinet later this year, probably in the autumn.

The council's strategic director for sustainable growth and development, Phil Mason, told today's meeting: "The operational airport will probably never break even. The lessons of the last 20 years teach us that we will never run this airport at break-even or a profit, because of its scale as a regional airport. So if we want an airport here, we are going to have to do something different."

Cllr Tim Dwelly (Independent, Penzance East) said: "Speaking as the shadow cabinet member for economy, I want to make a very important statement ... there is no political cross-party support for this process. There will be an election next May and I would suggest that a decision as important as selling – and it is selling, the word 'disposal' is in the documents – won't have political support and there's a risk to this project that it's being rushed through.

"I don't think anyone should sell – or if you prefer to say 'transfer' – their assets in a hurry. The whole atmosphere around this of rushing it through isn't going down well with members on the opposite benches, and I don't think the public's fully aware of it yet."

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He added: "There's also a very serious question about the terms of the review which have given a substantial bonus – a large amount of money – to CBRE [the global real estate company organising the search for a financial partner] if they manage to transfer and see it through. In other words, there's a sale bonus. That isn't the way you properly review an airport.

"I'm not the only who thinks that this should go to a full council vote. I don't think this is being handled properly. I'm actually outraged that it's being done this way."

Cllr Dwelly argued that the value of the 650-acre airport estate should be in the public domain and not discussed in the private second half of the meeting. He was also concerned that the council would end up with a minority role in the running of the airport.

Cllr Peter La Broy (Independent, Bude) agreed: "I'm not convinced disposal of the [airport] asset is best thing for the Cornish community. I don't feel we've explored all other avenues."

We understand that the expectation is that the partner will fund the airport subsidy for a period of ten years, by which time the council hopes investment in the site will have raised enough revenue that there will be no need for the £4m annual bailout.

Cllr La Broy said that having a very specific subsidy period "is an incredibly dangerous thing to do, because all we are building in is a sudden death point for the airport. I think that's a big mistake".

Cllr Leigh Frost (Lib Dem, Bodmin St Petroc's) said the process was flawed. "As far as I see it, we are going to sell off the family silver and hopefully some of that money will look after the airport for a little while. It doesn't create a viable environment for us or the airport."

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Cllr Tamsyn Widdon (Mebyon Kernow/Green Group, Penryn ) said councillors needed to "drop the argument" that the airport could close if the council no longer runs it: "Looking at the rest of the country and the evidence from different airports and House of Commons reports, it is not confirmed that if we don't own it ourselves it will close. Just because we don't own it as a council doesn't mean it won't stay open. In fact, Manchester Airport Group has expanded under joint ownership with councils and an aviation expert."

Cllr Dwelly tabled an alternative recommendation to the committee, seconded by Cllr John Conway: "The committee notes that the consultants were not asked to review alternative options to a majority stake transfer, such as an airport user's fee, to contribute to lower carbon on the site. It further notes that the consultants have been incentivised to enable a sale/transfer with a large bonus if this is achieved.

"We believe that the future of the airport is a critically important strategic decision for Cornwall’s future and therefore full council should have the final say. We recommend that the review is rejected in its current format and that any decision on the ownership of the airport be referred to the next administration following an objective consideration of all possible options."

He was advised that legally the disposal of the airport was an executive decision to be taken by Cabinet and not all councillors. His recommendation was lost by five votes for and six against. As a result, the committee agreed to note the the council’s approach to seeking an investment partner and review the proposed strategic masterplan for the airport estate ahead of Cabinet approval.