Alt-Coin Trader

Airlines could get £2bn ash pay-outs... and the taxpayer will pick up the bill

Airlines could share in a £ 2billion taxpayer-funded compensation bonanza in the wake of the volcanic ash chaos which turned Europe into a six-day no-fly zone.

The European Union has agreed to allow state help for airlines which have complained bitterly that the flight ban has cost them millions. They will be offered emergency loans and allowed to postpone payments of charges. The state aid compensation package to airlines was pledged yesterday by European Union Transport Commissioner Siim Kallas.

But it will be individual governments – and their taxpayers – who will be picking up the tab. Airlines have been furious that under EU rules they are obliged to pay for accommodation and meals for their stranded passengers. They complain that the nervous reaction of safety quangos such as Britain’s Civil Aviation Authority was to blame for the flying ban and spiralling costs.

More than 30 aircraft, including jumbo jets and helicopters, have reported incidents linked to the Icelandic volcano since the flying ban was lifted last week. These include a ‘smell of sulphur’ or evidence of volcanic ash, but the CAA stressed last night that there was no damage to any aircraft. Under new rules introduced last Tuesday, airlines must by law report any traces of ash and whether any damage has been caused.

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