{"id":71145,"date":"2020-12-01T13:29:41","date_gmt":"2020-12-01T18:29:41","guid":{"rendered":"http:\/\/mileniostadium.com\/?p=71145"},"modified":"2020-12-01T13:32:33","modified_gmt":"2020-12-01T18:32:33","slug":"airlines-disappointed-by-the-lack-of-a-bailout-plan-in-federal-fiscal-update","status":"publish","type":"post","link":"https:\/\/mileniostadium.com\/canada\/airlines-disappointed-by-the-lack-of-a-bailout-plan-in-federal-fiscal-update\/","title":{"rendered":"Airlines disappointed by the lack of a bailout plan in federal fiscal update"},"content":{"rendered":"
\"Airlines
Canadian airlines have been pushing the federal government for sectoral support for months as the pandemic continues to ground an unprecedented number of flights. (Darryl Dyck\/Canadian Press)<\/figcaption><\/figure>\n

 <\/p>\n

Groups representing the airline industry say they’re disappointed the federal government’s economic update failed to offer the sector \u2014 hit hard by the pandemic \u2014 new aid to help it survive the crisis.<\/strong><\/p>\n

WestJet shuts down most of its operations in Atlantic Canada<\/a><\/p>\n

The federal government said it’s prepared to spend\u00a0$980\u00a0million on supports and rent relief for Canadian airports. It\u00a0did not, however,\u00a0explain\u00a0how it aims\u00a0to help air carriers struggling with a drop in demand of\u00a0up to 90 per cent that has\u00a0caused them\u00a0to cancel dozens of regional routes and lay off or furlough thousands of workers.<\/p>\n

<\/section>\n

Mike McNaney, president and CEO of the National Airlines Council of Canada, represents the country’s largest carriers, including Air Canada, WestJet\u00a0and Air Transat.<\/p>\n

“While other countries around the world have moved forward months ago to provide sectorial support, we remain a global outlier and are ostensibly stuck at stage zero in the government planning process,” said McNaney.<\/p>\n

“We need to get moving. We need to get going on this.”<\/p>\n

The fiscal update says that since the beginning of the pandemic, airlines have received over $1.4 billion in support through the wage subsidy. The update also says the government is\u00a0now “establishing a process with major airlines regarding financial assistance” that is contingent on Canadians being refunded for flights cancelled due to\u00a0COVID-19.<\/p>\n

More than 100,000 Canadians\u00a0have joined petitions calling on the government to take action to compel airlines to refund passengers for cancelled flights,\u00a0and several class-action lawsuits have also been filed.<\/p>\n

Finance Minister and Deputy Prime Minister Chrystia Freeland\u00a0said $1.2 billion is in today’s economic budget for airports, airport infastucture, and regional airlines. She said\u00a0detailed talks are underway with major airlines about more support.<\/p>\n

“In order to know exactly how to support them, we need to really see what their financial position is,”\u00a0Freeland\u00a0told CBC’s Chief Political Correspondent, Rosemary Barton.<\/p>\n

$206 million to help regional air transportation<\/h2>\n

The fiscal update proposed\u00a0$206 million over two years to “support regional air transportation, including regional air carriers” by giving the funds to “Regional Development Agencies”\u00a0to\u00a0create a new “Regional Air Transportation Initiative.”<\/p>\n

“It doesn’t begin to cover what needs to be done,” John McKenna, president of the Air Transport Association of Canada, told CBC News. “We’re very disappointed again.<\/p>\n

“This government does not get our industry. They don’t understand the trouble we’re in.”<\/p>\n

McKenna’s organization represents about 35 large and small airlines, including Porter \u2014 which has\u00a0grounded its entire operation<\/u>\u2014 leisure carrier Sunwing and more than a dozen regional operators that serve rural and remote communities.<\/p>\n

McKenna said\u00a0his organization wasn’t consulted and it’s\u00a0not clear to him\u00a0exactly what\u00a0this regional initiative is.<\/p>\n

“Our industry has been working for over eight months now at 15 per cent capacity and we still have 100 per cent of our debt load there,” said McKenna. “The government’s done nothing to help us, other than saying, ‘I feel your pain.'”<\/p>\n

Boost to the wage subsidy<\/h2>\n

The government does plans to boost the wage subsidy back up to\u00a0cover 75 per cent of employees’ wages to deal with the “ferocity of the second wave,” according to the fiscal update. Currently, the maximum rate is 65 per cent.<\/p>\n

But McKenna said that subsidy doesn’t pay off airlines’ capital debt.<\/p>\n

“The hard part of the industry is that it’s heavily leveraged because they have to buy planes, hangers and\u00a0equipment and are heavily indebted and don’t have revenues to compensate,” he said.<\/p>\n

McNaney said he was hoping to see details of a financial aid program, more support for regional airlines, funding for Nav Canada (so it doesn’t have to increase fees for airlines) and rapid-COVID-19 testing at airports. Instead, he said, the government repeated the same message the industry has been hearing for months.<\/p>\n

\"People
People line up and check in for an international flight at Pearson International airport during the COVID-19 pandemic in Toronto on Wednesday, Oct. 14, 2020. (THE CANADIAN PRESS)<\/figcaption><\/figure>\n

The spokesperson for Air Transat, Christophe Hennebelle, said the economic statement was a\u00a0missed opportunity to announce a “robust plan” to make sure Canada’s airline industry remains competitive.<\/p>\n

“We are disappointed,” Hennebelle\u00a0said in a statement.\u00a0“We are still awaiting the start of discussions on the assistance announced on November 8, while significant support for the sector has already been provided in many countries around the world for months.”<\/p>\n

$980\u00a0million in payments, rent\u00a0relief slated for airports<\/h2>\n

The economic update did include\u00a0$500 million over six years proposed to start a new transfer payment program for large airports. Projects like the R\u00e9seau express m\u00e9tropolitain station at the Montreal Airport would be eligible for funding, according to the statement.<\/p>\n

The government is also planning to extend $229 million in rent relief to airport authorities that pay rent to the federal government and Billy Bishop Toronto City Airport. An additional $65 million is expected for airport authorities in 2021.<\/p>\n

Another $186 million would be aimed over two years starting in 2021 to help small and regional airports through the “Airport Capital Assistance Program.”<\/p>\n

Daniel-Robert Gooch, president of the Canadian Airports Council, said it will take a few days to understand in greater detail what was announced, but suggested it wasn’t enough.<\/p>\n

“It’s good to see the air sector get direct attention but this falls quite short of what the industry needs to endure this crisis,” said Gooch in a statement to CBC News.<\/p>\n

Tim Perry, president of the Air Line Pilots Association, said the support for airports should have a “positive spinoff” for airlines. He said\u00a0his group continues to call on the federal government\u00a0to remove “barriers” in place for airlines to return to flying when “Canadians are ready to travel again.”<\/p>\n

Talks started this month with major airlines about bailout<\/h2>\n

After months of mounting pressure from the industry, the government started talks this month with Canada’s major airlines\u00a0about an industry-specific bailout package that could include loans and other support.<\/p>\n

The Globe and Mail reported the talks got off to a slow and frustrating start. The government had a list of demands, including airlines opening their books, refunding\u00a0passengers for cancelled flights\u00a0and avoiding the\u00a0cancelation of\u00a0planned purchases of\u00a0new planes made in the country, the Globe said.<\/p>\n

Earlier in the day, Conservative MP Matt Jeneroux, who represents Edmonton Riverbend, took aim at the government\u00a0for not providing industry-specific support quickly enough.<\/p>\n

“Though other countries around the world immediately offered support for their airlines, this government didn’t’ acknowledge the crisis until eight months into the pandemic,” Jeneroux said during question period today.<\/p>\n

\"Check-in
Check-in kiosks are covered in plastic at the domestic check-in at Vancouver International Airport, Tuesday, June 9, 2020. (Jonathan Hayward\/Canadian Press)<\/figcaption><\/figure>\n

Transport Minister Marc Garneau said earlier this\u00a0month that\u00a0“a strong and competitive air transport industry is vital for Canada’s economy,” but said an aid\u00a0package would be conditioned on airlines offering refunds.<\/p>\n

“Before we spend one penny of taxpayer money on airlines, we will ensure Canadians get their refunds,” said Garneau on Nov. 8 in a press release.<\/p>\n

Since then, Nav Canada has\u00a0warned its air traffic controllers across the country that\u00a0layoffs are on the way as part of a “full restructuring.”\u00a0The\u00a0company\u00a0monitors millions of square kilometres of airspace and its air traffic controllers\u00a0keep planes separated in the sky and on the ground.<\/p>\n

The company has seen a\u00a0$518 million drop in revenue compared to its budget. According to the internal memo, Nav Canada has been “pressing” the government for help. Since Sept. 22, the company has cut more than 700 managers and employees \u2014 14 per cent of its workforce and\u00a0almost all of its students. Nav Canada is also studying seven towers across Canada for possible\u00a0reductions in\u00a0service.<\/p>\n

CBC<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Groups representing the airline industry say they’re disappointed the federal government’s economic update failed to offer the sector \u2014 hit hard by the pandemic \u2014 new aid to help it survive the crisis<\/p>\n","protected":false},"author":32,"featured_media":71146,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3539],"tags":[5309,18618],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"https:\/\/mileniostadium.com\/wp-content\/uploads\/2020\/12\/Airlines-disappointed-by-the-lack-of-a-bailout-plan-in-federal-fiscal-update-Milenio-Stadium-Canada.jpg","_links":{"self":[{"href":"https:\/\/mileniostadium.com\/wp-json\/wp\/v2\/posts\/71145"}],"collection":[{"href":"https:\/\/mileniostadium.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mileniostadium.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mileniostadium.com\/wp-json\/wp\/v2\/users\/32"}],"replies":[{"embeddable":true,"href":"https:\/\/mileniostadium.com\/wp-json\/wp\/v2\/comments?post=71145"}],"version-history":[{"count":0,"href":"https:\/\/mileniostadium.com\/wp-json\/wp\/v2\/posts\/71145\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mileniostadium.com\/wp-json\/wp\/v2\/media\/71146"}],"wp:attachment":[{"href":"https:\/\/mileniostadium.com\/wp-json\/wp\/v2\/media?parent=71145"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mileniostadium.com\/wp-json\/wp\/v2\/categories?post=71145"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mileniostadium.com\/wp-json\/wp\/v2\/tags?post=71145"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}