Blue Islands goes into liquidation

Blue Islands is going into liquidation.

Treasury Minister Elaine Millar says the government's thoughts are with the staff affected by the loss of the airline, and that she is confident 'sufficient help and advice is in place' for them.

"This is a testament to the hard work of Ports of Jersey, Loganair and many others during this turbulent time.

"Our objective has always been to ensure that Jersey has resilient and sustainable essential air links, and we are making good progress towards achieving that."

Deputy Millar has also clarified the amounts owed to the Jersey taxpayer by Blue Islands - namely £7.4 million outstanding from a loan it was given during Covid and £1.7 million from two additional loans since 12 September - making a total of £9.1m.

Blue Islands said its closure on Friday was due to Jersey's government failing to provide further financial support.

Deputy Millar said today:

“Having provided the financial support needed for Blue Islands to continue operating essential air links during Covid, and further support since then, the Government of Jersey was aware before Friday’s announcement of the company’s position.

"Discussions had taken place between Government and Blue Islands about what support could be provided. Those discussions, and their outcomes, were not made public because doing so would have risked compromising confidence in the airline, exacerbating an already difficult situation.

“Very considerable thought was given before Ministers took the decision not to provide further financing, subsidy or to take ownership of Blue Islands. We felt this was not the best use of public funds, and that more sustainable, alternative options were available to ensure the continuation of our lifeline routes."

Logainair has since taken over some of the Jersey routes previously operated by Blue Islands.

Deputy Millar confirmed it has been given some public money to do so:

"Government has agreed to provide up to £1.5 million to Loganair to accelerate their full entry into the Jersey market from up to 60 days to within 48 hours. In so doing, we have secured the future of the Island’s regional connectivity."

Deputy Millar says Loganair faces 'substanial set-up costs, far in excess of this funding' including leasing an extra aircraft.

Loganair and Aurigny are both now operating the Jersey-Guernsey route. However, Guernsey's Committee for Economic Development today announced that it plans to designate the inter-islands service as an 'essential' link, meaning airlines will need a licence by mid-January.

We're told both islands' Chief Ministers spoke over the weekend, and it is claimed they share a 'strong desire' to find the best possible solutions for the Channel Islands.

A meeting has been arranged to discuss how the islands can work together to create sustainable inter-island and regional connectivity.

Jersey's Treasury Minister says she will provide more detail in an update to the States Assembly on Tuesday 25 November.