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Herne Bay, England, CT6
United Kingdom

Community website for all things Herne Bay (Kent, UK). Covers: The Downs, Herne Bay Museum, Herne Bay Historical Records Society, Herne Bay Pier Trust, Herne Bay in Bloom, East Cliff Neighbourhood Panel, No Night Flights, Manston Airport, Save Hillborough, Kitewood, WEA, Local Plan and much, much more...

No Night Flights

Filtering by Tag: RGF

KLM-Manston: analysis

HBM

Regular readers will recall that the last time KLM showed any interest in Manston, they were being lured by the promise of £600,000 - money which Manston and KCC were trying to prise out of the Government's Regional Growth Fund. The Government said "No", and KLM faded into the background. I do hope this new service isn't being subsidised from the public purse (national, county or district).

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All aboard the 4.20am flight to Amsterdam?

HBM

smiley tired.png

Let's have a quick look at the latest exciting news to come from Manston airport. The suggestion is that KLM's decision as whether or not to run a twice a day service between Manton and Schipol will be influenced (but not decided) by the response to Manston's online survey.

  • Charles Buchanan says that KLM would have a plane parked at Manston overnight, ready to fly to Schipol each morning.
  • Charles Buchanan has often said that planes only make money when they are in the air, so it follows that KLM would want their "Manston" plane back in Schipol bright and early so that it has plenty of working (flying) hours ahead of it through the rest of the day.
  • Schipol Airport is effectively closed between 10pm and 6am, and Amsterdam is one hour ahead of us (at the moment).
  • The flight time from Manston to Schipol would be about 40 minutes.
  • To arrive in Schipol at 6am (local time), KLM's "Manston" plane would have to leave at 4.20am (local time).
  • The online questionnaire doesn't ask what time of day people would like to fly - now you know why.
  • The online questionnaire doesn't ask how much people would be prepared to pay for their flight.

As influential local commentator Maurice Byford has pointed out:

Any business worth its salt would carry out due diligence, population and traffic analysis and SWOT analysis without resorting to a survey. You might want to ask, how many people travel to Europe from Kent, but then you need only look at the traffic figures from EuroStar train from to see the passenger footfall for Belgium.

There are plenty of reputable consultancies that specialise in providing detailed economic and demographic analyses to help businesses make rational commercial decisions. They have access to all the available data on business activities, income distribution and socio-economic groupings by post code. They have a pretty good idea how many people run businesses with European interests, and how many people are likely to take weekend jaunts to the Continent or connect to long-haul flights.

It is very likely that KLM have already done their homework, which is why they were looking for £600,000 of public money to underwrite the risk of operating from Manston. The online survey doesn't cover two of the questions that KLM most clearly need answered - how much will people pay, and how willing are they to accept KLM's offering (i.e. first thing and last thing, and nothing in between).

Airlines are high investment, high throughput, low margin businesses. They employ people full-time to examine every available business opportunity, and re-examine each option every couple of years. All of the major airlines will have examined and re-examined Manston over the years it has been owned by Infratil. With the exception of FlyBe's tentative experiment with a couple of minor routes (which failed for lack of passengers), there have been no takers.

KLM's interest in Manston may simply be that it is cheaper to park a plane there than at Schipol, and there's the possibility that the passenger fares would exceed the fuel costs to Schipol. In all probability, KLM will discover what others have discovered before them - Manston's catchment area cannot support a successful passenger or freight airport. It doesn't matter how keen the local residents or the local businesses are - there simple aren't enough of them.

After years of fanciful forecasts, missed targets and false hopes, this may be Infratil's legacy - a minimal passenger service that only ever flies at night, while the airport is almost entirely idle through the 16 hours of daytime. This is Infratil waving goodbye, with two fingers.


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Trevor wants a Parkway

HBM

NEWSFLASH: the real reasons Flybe quit Manston - click HERE


Kent Online's business editor Trevor Sturgess argues for a Parkway station and high speed rail links, but I think he's missed a few relevant points [my comments are bracketed in italics].


Flybe’s decision to pull out of Manston is another blow to the airport, especially disappointing at the turn of the year. However attractive we in Kent think Manston is, it seems that not enough people agree.

Flybe’s bold experiment to run flights to Edinburgh, Manchester and Belfast was welcomed, but once again it ends in disappointment. The Manchester service was pulled some time ago, and the Belfast operation was grounded at the end of the summer. Edinburgh has been popular with leisure flyers, students, servicemen and women, and some business folk. But the lack of a day round trip made it inconvenient for business. It was a similar disappointment a few years ago when the Irish-based airline EUjet went belly-up after stretching itself over too many services.

[Business sense, and common sense, meant that Flybe reserved its prime slots at Manchester, Edinburgh and Belfast for the flights that they knew were going to be full. This meant that flights offering same day turnaround were not available for Manston. This is simply another example of success breeding success, and the devil take the hindmost. This is a problem that Manston will always face - they will have to make the most of the scraps and crumbs offered to them, at least to start with.]

So despite the smiles on the ebullient airport CEO Charles Buchanan, Manston has a problem with scheduled passenger services. What message does Flybe's decision send to other would-be operators? Manston has no difficulty with freight - including horses through its new equine centre - and charter flights to holiday places in the summer do pretty well. Car parking is a breeze. Two minutes after unloading the boot, you are in the terminal.

[Manston has the same difficulty with freight as it does with passengers – not enough. The holiday charter flights are seasonal, and few in number. The ease of parking and rapid access to the terminal are both a direct result of Manston being a tiny airport. If Manston does grow in line with its business plan, to the point where it's handling 3 million passengers in 2018, the car park will have to be larger, the walk will be longer, and checking in will be take longer. This is the downside of growth.]

Yet there just doesn’t seem to be a big enough market for scheduled services. Why is this? OK, the downturn has not helped but there must surely be something more fundamental than that. One factor is constrained night-time flying. Thanet council should back the airport's modest demands, despite opposition from some residents. It would, after all, be good for jobs and local people desperately need them. Manston ought to be the solution to over-crowding at Heathrow, Gatwick and Stansted. But the Kent terminal with one of the longest runways in the UK has been largely overlooked in official reports, even though senior Kent people are always talking up its credentials.

[The long-standing ban on scheduled night flights is not what prevents the airport being a success. Easyjet went to Southend airport – which doesn't have night flights. London City airport and Belfast airport, both very successful, are shut overnight.

The airport's demands are not modest – they are asking for an unlimited number of flights between 11pm and 7am. The only restriction they are suggesting is between 11:30pm and 6am.

There is no evidence that night flights would be good for jobs – quite the reverse. The 3,000 jobs that Manston says it will create by 2018 is an absurd overestimate. The few hundred jobs that it might create will be easily exceeded by the number of jobs lost in the local tourism industry.

Incidentally, the length of Manston runway is no longer the advantage that it once was, as more efficient modern planes can take off and land in shorter distances.]

Manston’s disadvantage is that it’s more than 60 miles from London. At the eastern end of the UK, It is not surrounded by chimney pots.  But remote airports are not seen as a disadvantage by the likes of Ryanair and EasyJet who bus people miles from a cheap out-of-town terminal.

[Now at last we get to the heart of the matter. Location, location, location.

Ryanair and easyJet can take advantage of "remote airports" if and only if they are the closest airports to the passengers' ultimate destination. East Kent is not a popular destination for air passengers, London is. The huge number of passengers London attracts will inevitably and understandably use the airports that are more convenient.

So Manston loses out as an airport for arrivals, and it also loses out as an airport for departures. Again it's down to location. If you draw a 30 mile circle around any successful passenger airport, you will find that the circle is full of people. If you draw a 30 mile circle around Manston, you will find that 75% of it is full of seawater. There aren't enough people living near enough Manston for it to succeed.

To be a successful passenger airport, you don't need night flights, you need passengers.]

Roads like the Thanet Way are pretty good but potential customers from South East London probably think they are worse than they are. So make it easy.  A Manston Parkway station and dedicated high-speed railway –a “Manston Express?” – would make a huge difference. The Regional Growth Fund allocated some welcome cash for a track upgrade. For a fraction of the cost of a Boris Island or Foster's Grain proposal, upgraded links would transform Manston's image. It would be great to see politicians "getting it" in 2012.

[Manston airport and KCC applied to the Regional Growth Fund for £10 million to build a Parkway station (and a £600,000 sweetener to persuade KLM to use the airport). They were turned down flat. The government decided that the forecast number of passengers did not justify a station, and in any case the spur to Manston airport would slow down the trains on the recently upgraded line to Ramsgate.]

But the sad truth at the moment is that investors - and other scheduled operators - will be wary of committing to a terminal that keeps suffering setbacks.

The Business Blog, Trevor Sturgess 28th Dec 2011


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Why Steer Davies Gleave?

HBM

This is from the internal KCC document that describes how the contract (to produce the supporting report for the £10m RGF bid) was awarded.


Outline of Project

Although KCC has previously carried out some outline feasibility work for the proposed Thanet Parkway station (most recently in July 2009), this requires significant updating and development; including more comprehensive passenger demand forecasting and a full feasibility design of the station and car park, if a robust and credible RGF bid is to be prepared. The Government is particularly interested in the job creation potential (both direct and indirect) of proposed schemes, which has not previously been a requirement of traditional transport appraisals. For these reasons, and in light of the challenging timescale for the submission of a first-round RGF bid, it was agreed with the Director of Integrated Strategy and Planning that KCC should invite three technical consultants to tender for this work. [You can read the Invitation to Tender below.]

Reasons for appointing this particular Consultant:

Steer Davies Gleave have been appointed to work on this project primarily due to their proposed approach to the calculation of the additional employment created (directly and indirectly) as a result of the construction of the Thanet Parkway station. This is the key criterion against which RGF bids will be appraised by Government and therefore it is crucial that the consultant's approach in this area is thorough and robust.

The approach proposed by MVA and Jacobs was relatively primitive, relying heavily on consultation with a limited number of local employers (specifically Kent International Airport and Pfizer) to establish the likely number of additional jobs arising from the development of the Parkway station. By contrast, Steer Davies Gleave propose to use their Spatial Economic Impact Model (SpECTRa), which takes as inputs the results of Benefit Cost Analyses of the station and models the structural changes these impacts cause on the local economy via productivity gains and increases in attractiveness. The outputs of the model include changes to wages and prices, to jobs by occupation, to productivity and output, as well as to trade with the rest of the UK, by economic sector.

The SpECTRa model has been approved by the DfT in previous transport scheme appraisals and represents a more comprehensive and sophisticated approach to economic analysis than those proposed by MVA and Jacobs.

Benefits Expected of appointing this Consultant:

The principal benefits expected from appointing Steer Davies Gleave to work on this project are those relating to the quantification of the economic benefits of the Parkway station, as described above. Steer Davies Gleave have extensive experience of preparing business cases and funding bids for rail infrastructure projects, including Liverpool South Parkway and the proposed Stratford Parkway.

The fixed fee of £42,723 proposed by Steer Davies Gleave is considered reasonable. The funding will be made up of contributions from KCC's Sustainable Transport and Transport Policy Teams and Thanet District Council.


Did you spot any key phrases?


Dear Reader, you can download your copy of the once-secret KCC Bid Document below, and if you can deduce (or already know) the identities of the airline, or the European hub airport, that are painstakingly blacked out throughout the document, do let me know. Thank you.



No Night Flights home page

Manston boss claims it wasn't a "sweetener"

HBM

Charles Buchanan, chief executive, Kent International Airport, ManstonBitter-sweetener

Manston's boss has defended efforts to persuade the government to underwrite the costs of a new service out of the Kent airport. Chief executive Charles Buchanan said subsidies from the public purse were commonplace and it was unfair to describe them as sweeteners.

His comments follow our disclosure that KCC and Infratil, which operates the airport, had sought to persuade ministers to provide £600,000 to underwrite a twice-daily service out of Manston for the first three years of its operation.

An unnamed company is in confidential talks about the service, which could get underway next April. Mr Buchanan said:

"It is unfair to call this bid for support a ‘sweetener’. What are known as route development funds are approved of by the European Commission because they have been proven to build strong regional economies. Public funding for the development of routes between airports is commonplace in Europe and has been, and continues to be, used in the UK. For example, the recent announcement of the start of a new service between Inverness and Amsterdam was on the back of support from Highlands & Islands Enterprise. Support funding was also contributed by the Highland Council, the Highlands and Islands Transport Partnership and VisitScotland."

With the closure of Pfizer, it was even more important to focus on stimulating the east Kent economy.

"Investing in routes from Manston would deliver significant benefit to the area. We recently published an economic impact report undertaken by York Aviation which suggested that Manston could provide direct employment for 2,070 people and a further 1,035 jobs in the wider economy by 2018 through the delivery of our masterplan."

He confirmed that discussions were taking place with other operators interested in providing new routes. According to documents released under the Freedom of Information Act by KCC, consultants had estimated the new twice-daily route would create 23 jobs at the airport and a further 133 across the area over the next eight years.

Campaigners opposed to the expansion of Manston argued those figures were modest and raised questions about the value of a public subsidy and the viability of the airport over the long term.

kentonline 16th Jun 2011


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£600k airport 'sweetener'

HBM

The government has been urged to offer a £600,000 "sweetener" to an unnamed commercial airline planning a new daily service from Manston airport, it has emerged.

The airport operator Infratil is in advanced confidential talks with an unidentified airline which has plans for a twice-daily service to an unnamed European destination from next April. Now it has been revealed Kent County Council and operators Infratil pressed for a taxpayers’ handout to underwrite the costs of the service for three years, according to documents released under the Freedom of Information Act.

They show that in an ultimately unsuccessful bid for a share of Regional Growth Fund money from the government, KCC and Infratil argued the six-figure subsidy was needed as the potential new operator faced a significant financial risk setting up the service. Infratil has defended the idea in the face of criticism by opponents of the expansion of Manston, who said it would be wrong to use public to support a commercial airline. A spokesman for Manston said:

"We are always in discussions with airlines and we always work with partners, such as Kent County Council, to put together the strongest possible case to attract new carriers and services. We believe using public money to underwrite the initial running costs of any new air service is indeed excellent value for the public purse, as studies have shown that the biggest beneficiary is the economy of the community surrounding the airport."

Consultants commissioned by KCC to examine the impact of the new service said just 23 jobs would be created at the airport with a further estimated 133 indirect jobs over eight years across east Kent. The bid documents show the government was also urged to provide a further £500,000 of taxpayers’ cash to meet the costs of the airport jobs. In total, the consultants estimated theeast Kent economy would benefit by £995,000 a year.

Opponents of plans for night flights from Manston said the documents raised questions the airport’s viability. Campaigner Phil Rose said:

"In public, and in the press, Manston says that 2.2 million passengers equals over 2,000 jobs. In KCC’s bid document, three-quarters of a million passengers equals two dozen jobs. The sums just don’t add up - this is the maths of the madhouse. Manston recently told the world that night flights were critical to the success of the airport. Now the bid document says an unidentified operator is critical to their success."

KCC leader Cllr Paul Carter said:

"We know that every million passenger movements creates 1,000 jobs. Until you can start to build momentum at Manston, you will not create those jobs."

He had made it very clear that he had not wanted KCC money used to underwrite any new service, he added.


Manston’s failed bids for public cash

Manston has twice before had public money invested in airline ventures which both failed.

  • In 2005, KCC ploughed £100,000 into a service operated by EUJet, which went into administration.
  • In 2007, KCC then spent nearly £300,000 in 2007 in an unsuccessful venture to run weekly charter flights from Manston to Virginia in the USA.

As part of its bid totalling £10.8m, the government was asked to support a request for £7.7m to build the Thanet Parkway station and £2m to improve journey times between Ramsgate and London.

kentonline 15th June 2011


No Night Flights home page

Air Anon at Manston

HBM

From the once-secret KCC funding bid

There seems to be an endless supply of consultants, ready willing and able to tell the emperor of the day how lovely his clothes are, and how much lovelier the next suit will be.

Next up in line is an outfit called Steer Davies Gleave who aim "to provide unrivaled advice that helps deliver better transportation solutions to everyone, everywhere". And freedom from the nagging pedantry of spell-checkers, presumably.

SDG have made two invaluable contributions to the now widely-read KCC funding bid - a Technical Note on the impact of the new air service, and a Technical Note on the proposed new Thanet Parkway station. Planes and Trains, but no sign of Automobiles yet.

The forecast impact of Air Anon

SDG follow the pattern set by the rest of the bid and kindly spare Air Anon the shame of being associated with Manston airport by scribbling out their name with their blackest marker pen. Curiously, they also censor the names of the two airports that they think are similar to Manston. Dear Reader, I offer you a priceless prize if you can deduce the names of these two airports - here are the clues:

and...

and...

...any ideas? No? Not to worry - the real chuckle value comes when they move away from actual places into the increasingly abstract realm of numbers. The first blooper is pretty elementary:

Mmm... 32,000 doesn't actually happen on that graph. Never mind. Let's see what they make of the two secret comparison airports...

They tot up how many people are in the catchment area (60 minutes drive, for the purposes of this exercise), and it turns out that one is about the same size as Manston, the other is 50% bigger.

Then they find out how many trips everyone in the two catchment areas took in a year (about the same), and come up with trips-per-year figures (which differ by about 50%).

Then they apply the trips-per-year figures to the Manston catchment population and come up with two very different forecasts for the total number of trips per year from Manston. Ingeniously, they use these figures as High and Low figures, rather than accepting they may not have chosen the comparator airports very well.

They then waste a couple of pages flaffing about with a "propensity to fly" multiplier, which eventually makes less than 0.5% difference to the forecast.

The upshot is that they reckon Manston has a population of 275,000 in its catchment area, and Air Anon could attract 119,000 passengers a year, TOPS!

Personally, I think this is a hopelessly crude model - there are many more factors (some of them much more significant) in the decision to fly that are being ignored. The proximity of the destination airport to where people actually want to be, the all-in ticket prices, the days of the week and times of day of the outward and return flights, parking, transfer times, legroom, check-in lead times, airline reliability, etc, etc.


Dear Reader, you can download your copy of the once-secret KCC Bid Document below, and if you can deduce (or already know) the identities of the airline, or the European hub airport, that are painstakingly blacked out throughout the document, do let me know. Thank you.



No Night Flights home page

A closer look at that bid

HBM

The once-secret KCC funding bid

Bureaucracy being what it is, KCC and Infratil were obliged to spell out in detail the brazen cheek of their cash plea. Do please remember that Infratil is a New Zealand-based investment company, and that whatever profits it can (finally) squeeze out of this lemon of an airport will be going straight back to their antipodean investors, still smarting from years of multi-million pound losses.

Infratil Airports Europe Ltd (IAEL) will progress the introduction of a twice-daily direct air service from Manston (Kent International) Airport to [censored] ...  As with any new venture of this nature, however, the proposed service presents significant financial risks to [censored]. It will therefore be necessary for IAEL to underwrite the service for its first three years of operation, representing a total financial commitment of £600,000. Funding for this purpose is being sought through the Regional Growth Fund.

Translation: We would like you to join us in treating Air Anon as a special case, and exempt them from the everyday commercial realities, risks and pressures that apply to everyone else in Thanet and Kent. We were rather hoping the airport owners would cushion them with a generous sweetener, but Infratil are tired of throwing good money after bad, and obviously don't regard this as a good bet. So we would like a handout.

The commencement of the new air service will trigger the employment and training by IAEL of 23 personnel at Manston (Kent International) Airport. This represents a revenue cost over three years of £500,000, which is being sought through the Regional Growth Fund.

Translation: The airport owners aren't even prepared to pay their own staff. So we would like a handout.

IAEL will fully fund a dedicated bus shuttle service for air passengers between the Thanet Parkway Station and Manston (Kent International) Airport. This service would commence immediately following the opening of the Parkway Station and would represent an ongoing annual revenue cost to IAEL of approximately £100,000.

Translation: Because we're planning to build the Parkway station where there are no other public transport links, Infratil are obliged to pick up the tab for chauffeuring their handful of passengers to the airport. We're only mentioning this in the hope that it is construed as Infratil being generously public-spirited, rather than grudgingly accepting commercial necessity.

As part of the first phase of the Manston (Kent International) Airport Master Plan, IAEL will fund the capital cost of a new Airport Southern Approach Road, to reduce interchange times by bus between the Thanet Parkway Station and the airport terminal and to divert airport-related traffic away from Manston Village. The capital cost of the road has initially been estimated as approximately £6.5 million. It is anticipated that the road would be constructed once throughput at the Airport reaches approximately 3 million passengers per annum.

Translation: Infratil "anticipate" a throughput of "approximately" 3 million passengers only in their wildest forecasts and know, in their heart of hearts, that their £6.5m is safe. But the never-to-be-realised promise makes them look good.


Dear Reader, you can download your copy of the once-secret KCC Bid Document below, and if you can deduce (or already know) the identities of the airline, or the European hub airport, that are painstakingly blacked out throughout the document, do let me know. Thank you.



No Night Flights home page

Yet another job forecast

HBM

From the once-secret KCC funding bid

What a wondrous thing is the Freedom of Information Act. Without it, we wouldn't know what KCC had said to the money-bags at BIS in their plea for free money. They have repeatedly tried to dodge FOI requests, until finally cornered by our tireless truth-seekers.

It will come as no surprise to the more cynical of our international readership that it's not just the tone and emphasis of what KCC and Infratil say in their bid that differs from what they've been saying publicly, it's the numbers too.

Here's just one example from the ill-fated bid document:

The commencement of twice-daily air services to [censored] would provide a catalyst for the wider development of Manston (Kent International) Airport, which is expected to create up to 2,800 direct and indirect jobs by 2018, rising to 6,000 by 2033. In the short-term, it would trigger the employment and training of 11 Airport Fire and Rescue personnel, 9 Airport Security personnel, and 3 Customer Service personnel on a full-time, permanent basis. This would enable the Airport to expand its operating hours from the current 12 hours per day to 18 hours per day and to handle up to 750,000 passengers per annum and more than double the existing levels of freight, making the best use of its existing facilities. This wider availability of the Airport – combined with its direct access to the Thanet Parkway Station – will improve its attractiveness to potential operators of both passenger and freight services. Each additional weekly cargo flight would generate between £150,000 and £200,000 in revenue, which is likely to be re-invested in airport infrastructure, staffing and services, thereby further enhancing its capacity to handle larger volumes of flights.

I've already introduced you to the laughable basis of the "thousands of jobs" forecast. What is interesting about this piece of immortal prose is the short-term forecast.

Manston are happy to state in this once-secret document, that with 23 extra staff they would be able to handle twice the current tonnage of freight, and 750,000 passengers a year. In 2010, they handled 21,000 passengers, and the latest figures from the CAA (Civil Aviation Authority) show about 2,000 a month so far in 2011.

This is the first indication yet of how the number of jobs would increase with the number of passengers. An annual increase of three-quarters of a million passengers would require only a couple of dozen extra staff. This is a far cry from the 1,104 jobs per million passengers that Manston's PR machine has been touting about the county in recent days.

Incidentally, another of the once-secret documents (which will star in a number of further posts) "forecasts" the growth and impact of the top-secret, anonymous, censored and redacted airline that KCC wanted to "sweeten" with public money to use Manston. It "forecasts"  that the service would take three years to mature, at which point it would be carrying 119,000 passengers a year, tops. So where is the rest of the ¾ million coming from?


Dear Reader, you can download your copy of the once-secret KCC Bid Document below, and if you can deduce (or already know) the identities of the airline, or the European hub airport, that are painstakingly blacked out throughout the document, do let me know. Thank you.



No Night Flights home page

KCC's empty begging bowl

HBM

In the middle of last year, the Government (in the form of the Department for Business Innovation and Skills - BIS) launched the Regional Growth Fund (RGF). The RGF aims to "support projects and programmes that lever private sector investment creating economic growth and sustainable employment. It aims particularly to help those areas and communities currently dependent on the public sector to make the transition to sustainable private sector-led growth and prosperity".

Across the length and breadth of our proud nation, there was a cacophony of snorts and oinks as snouts were pressed to the trough, greedy for their share of the £1.4 billion on offer. KCC was there, looking for a handout to support their crackpot proposal for a Parkway station at Manston, and some free money for the airport. Here's why they failed:

Thanks to the Freedom of Information Act, we can now see what KCC were doing on our behalf (if they had their way, this would still be secret). They were after a total of £10.8 million from the Regional Growth Fund, which breaks down thus:

  • £7.7 million towards the capital cost of the Thanet Parkway Station;
  • £2 million towards the capital cost of the St Pancras-Ramsgate Journey Time Improvement Scheme (Phase 1);
  • £600,000 towards the underwriting of the proposed [censored] air service from Manston (Kent International) Airport to [censored] for three years from summer 2012; and,
  • £500,000 towards the delivery of the first phase of the Manston (Kent International) Airport Master Plan, including the training and employment of 11 Airport Fire and Rescue personnel, 9 Airport Security personnel, and 3 Customer Service personnel on a full-time, permanent basis.

The balance of the cost of the Parkway station would be met by Infratil (£560,000) and by borrowing (£1.96m).

The £2m would achieve a journey reduction time of 2 minutes. (Time really is money!)

The £600,000 would be a, er, "sweetener" to persuade an unnamed airline to use the airport.

The £500,000 would be, er, paying Manston to be an airport, and thus returning to them most of the £560k they would have stumped up towards the cost of the station. Nice!


The RGF application form clearly states:

The Regional Growth Fund seeks to encourage sustainable private sector-led growth.

It appears KCC didn't read the RGF guidelines very carefully, as the application is littered with bullets, aimed squarely at their own feet.

The operation of an air service from Manston (Kent International) Airport to a European hub would be unlikely to happen at all without the Airport subsidising the airline operation. In the current economic environment, the Airport, operating as it does at an annual loss, is not in a position to provide that subsidy to the level that would sufficiently encourage the airline to commence operations.

Translation: No airline can be persuaded to operate out of Manston without being paid. The airport is skint and getting poorer, so can't afford the sweetener. Bang!

The alternative funding sources for underwriting the proposed air service from Manston (Kent International) Airport to [censored] are principally either from the airline, the Airport, or external third parties. In this case, the airline would already be making a contribution through the risk level it would take in covering the operating costs of the service. It should be remembered that airlines have completely mobile assets which they are able to deploy at a wide range of airports on a variety of routes. The support that an airport and its community are able to provide towards the start-up costs and risks, is regularly influential in their route development decisions.

Translation: The airport can't afford to pay the airline, and the airline thinks just being there is risk enough. Airlines are flighty, and need to be lured with cash. Bang!

Manston Airport is operating at a loss, and has done so for many years. Whilst Infratil is prepared to invest in the development of the Airport’s infrastructure, and to cover the existing level of losses together with a contribution to the additional costs for the first years of a new service, it would not be prepared to cover 100% of the route support costs for this new route. In addition, the commitment of the local community that would be illustrated by a successful funding bid will be viewed by the airline as a significant statement of support for the route.

Translation: The airport really is skint, the owners are tired of seeing their money disappear, and aren't even prepared to take a punt on this new airline. Bang!

The RGF application form goes on to say:

In order to ensure good value for money for the taxpayer, it is important that the additional economic benefits associated with supporting a project exceed the costs of Government support.

At this point, KCC reloads and blunders on:

While the Thanet Parkway Station will not require ongoing public support once it is operational, as revenues are forecast to exceed operating costs, the initial capital cost results in the scheme not being commercially viable, namely financially positive. The introduction of twice-daily direct air services between Manston (Kent International) Airport and [censored] will create 23 additional direct jobs at Manston Airport. Along with the three jobs created by the opening of Thanet Parkway station, there are estimated to be 26 direct jobs.

To save your calculator batteries, that's £415,384 per job generated by the £10.8 million. Remember that bit at the beginning of this post, about RGF wanting to help make the transition from public sector to private sector jobs? KCC's application was looking for a level of public subsidy that would have embarrassed the British Leyland of old.
 
In the over-crowded sweepstake that is the Grand National economy, the Government decided not to back this particular three-legged donkey. Quelle surprise!


Dear Reader, you can download your copy of the once-secret KCC Bid Document below, and if you can deduce (or already know) the identities of the airline, or the European hub airport, that are painstakingly blacked out throughout the document, do let me know. Thank you.



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