EU 'reluctant' to give aid to airlines

EU transport ministers have today backed an executive proposal to unify European airspace but not the idea of financial aid to…

EU transport ministers have today backed an executive proposal to unify European airspace but not the idea of financial aid to airlines grounded by a volcanic ash cloud last month, officials said.

In a meeting held as Ireland closed its airports for several hours again due to further drifting ash from the Icelandic volcano, the European Commission won support for plans to push forward its "Single Skies" package to unite national airspaces into just nine blocks by June 2012.

This would help co-ordinate air traffic during future crises.

The Commission estimates the April disruptions to air traffic cost an already struggling industry up to €2.5 billion.

READ MORE

In addition to the Single Skies initiative, the Commission proposed helping airlines ride out their cash-flow problems by deferring charges paid to air traffic controllers.

"This was one idea that was not very warmly welcomed in the Council," European Transport commissioner Siim Kallas told reporters. "The most-hard hit were the airlines...and the idea was to share their burden."

EU diplomats said the ministers also had "serious concerns" about proposals to help airlines by granting them state aid to help cover the costs of caring for stranded passengers.

"Very few came out and said they were considering state aid measures," said one diplomat. "Finland, Sweden, Austria, Belgium and Romania all said they were against the idea and had concerns it would damage the level playing field."

Mr Kallas reiterated his warning to airlines that their demands for compensation would not be easily granted.

"There is no sack of money available," he said.

Ministers did, however, give some support to Kallas' plan to push forward the unification of European airspace.

"We tried to accelerate a number of mechanisms already planned in the Single European Skies package," said Jose Blanco, transport minister for Spain, which now holds the EU's rotating presidency.

Ministers stressed the importance of safety after Icelandic forecasters said today a fresh volcanic ash could cloud airspace over northern Britain for the next few days.

Reuters