Irish airports to get €90m to lure back airlines following effects of Covid

European Commission confirms plan is in line with EU state aid rules

Cork Airport. Minister for Finance Paschal Donohoe earmarked €90m in Budget 2022 for airports to offer discounts and incentives to airlines to restore services following almost two years of Covid travel curbs

Cork Airport. Minister for Finance Paschal Donohoe earmarked €90m in Budget 2022 for airports to offer discounts and incentives to airlines to restore services following almost two years of Covid travel curbs

 

Irish airports will have €90 million next year to lure airlines back to restart pre-Covid routes or launch new services after the European Commission approved Government aid for ailing air travel.

Minister for Finance Paschal Donohoe earmarked €90 million in Budget 2022 for airports to offer discounts and incentives to airlines to restore services following almost two years of Covid travel curbs.

The European Commission confirmed on Friday that the plan was in line with EU state aid rules, allowing the Government to go ahead and allocate the cash to the Republic’s airports.

The commission found that the proposal would compensate for damages directly linked to the coronavirus outbreak, was proportionate and did not exceed what was needed.

EU law bans state aid where it distorts normal commercial competition, but changed the rules temporarily to allow member countries to support businesses through the pandemic.

A commission statement noted that the Government’s airport aid proposal was in line with the conditions set out in that amendment.

“The European Commission therefore concluded that the scheme, as amended, is in line with EU state aid rules,” it said.

Following Mr Donohoe’s announcement in October, Hildegarde Naughton, the Minister of State for International Transport, confirmed that the EU would first have to approve the €90 million proposal.

However, the Government expected the commission to back the plan as it had already allowed other states to provide similar aid to their air travel industries.

The deal itself consists of damage compensation for €87.5 million and a proposed €3 million increase in aid to airports handling fewer than three million passengers a year.

The Government said airports could use the cash to offer incentives to airlines to restore routes.