Thursday, February 10, 2011

Hedge Fund Owned London City Airport Make More Unbalanced Claims

Since the the 18th November we keep hearing about a report that the City of London Corporation have paid York Aviation to carry out. Interestingly, the media have referred to it on various occasions since, but low and behold, none of them had seen the report when we questioned them. So all the spin and claims were without any reference to evidence for the past few months.

Today we see more over exaggerated claims from the airport about their self claimed contribution to London.

"As well as direct economic benefits, it has also levered investment in public transport, in particular the DLR extension to Woolwich Arsenal"

Really, they invested so much in the DLR? Transport from London and the Transport Select Committee didn't seem to think their contribution was so great as we wrote in a blog item in November 2008:

At the Select Committee on Transport 9 May 2007, yet again it appears that London City Airport c/o Richard Gooding has been shirking it full financial responsiblities. The moths must really build up in LCAs gold coin purse. Before reading the following, keep in mind that LCA consistently tells residents in Newham that LCA is responsible for the regeneration, particularly in the Royal Docks. They have indeed even claimed that it was down to them that the DLR came to town, always inferring that they have invested so much finance into the area and into the DLR - seems they didn't invest as much as they'd like you to think:

Q595 Chairman: How do you think dedicated services ought to be funded from airports as public transport?

Mr de Cani: The DLR extension has been funded primarily through Transport for London so it is publicly funded. However, there are small contributions through planning gain agreements, section 106 agreements. London City Airport has made a small contribution to the extension of the order of about £2 million. That compares to a capital cost of about 140 million. We would have liked it if they had made a bigger contribution and we tried to do that but the railway is serving a whole range of other objectives and contributing to the regeneration of east London so this extension was not just about the airport. We think they got a good deal.

Chairman: I am sure they did.

So they 'levered' in £2 million out of £140 million towards the DLR. So that adds up to just over a 1.4% contribution, the rest picked up by....surprise, surprise the London taxpayer! Still, going on how difficult it is to get money out of London City Airport (see reference to security costs) then we can imagine it really did have to be 'levered'.

As for LCY being the main regenerator of the area, it is arguably Exel that is the driving force bringing in £1.6b annually (just a little more than the claimed £500m by the airport!), without the noise and air pollution and whom have won awards for their wormery. The best you'll get for 'green initiatives' at LCY, is a photo of a paper shredder, as proudly displayed in their application for expansion.

Richard Gooding was quoted as saying: “Whilst we have to do everything we possibly can to mitigate environmental impacts, we run into the trap of ignoring the benefits,”

Well there's one thing that London City Airport haven't done and that's ignore the benefits, the business welfare benefits on offer to them: particularly those from the London tax payers purse through all the millions of pounds of subsidies from the London Development Agency. But don't forget the £5.5m+ a year security bill which they simply refuse to pay because they think you, the London tax payer, should pay it for them. Yes, the London tax payer is paying for a private hedge fund owned airport!

So when your council cuts your services, closes down your libraries, reduces your policing due to the economic environment at the moment: question whether London City Airport are being told to sling their hook and pay their own £5.5 million security bill, repay the £24 million security costs they've had over the past 5 years or so, and repay all the tax payer funded monies they have been given by the LDA over it's lifetime? Apparently we're all in this together, aren't we? So if your communities funding is being cut, why would tax payers money continue to be given to a privately owned airport?

Richard Gooding is correct in referring to an 'unbalance': there is clearly a very big imbalance between the amount of London taxpayers money which has funded the airport and how little is given back to Londoners. It's ironic and strange, for an airport that claims it is 'integral' and a key source of regeneration that after 25 years that Newham is still one of the most socially deprived boroughs in the country.

It must have been really helpful for that lowest tax band increase on the lowest earners to help subsidise private businesses like London City Airport. Never mind where the money comes from or at what cost eh?