Simon Calder: The man who pays his way

How posting a pound could rescue Ryanair from oblivion
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The Independent Travel

Pensioners are queuing up to buy postal orders, students are emptying their scant bank accounts and airport staff at Stansted are handing around the hat asking passengers to organise a Laker-style bail out for that nice Michael O'Leary.

I've gladly sent the Ryanair rescue fund my £1 (plus taxes, fees, charges and wheelchair levy) to the Chief Executive, Ryanair, Dublin Airport, Republic of Ireland. How could that beastly European Commission fine the airline boss £3m, when he has been trying to spread joy and cheap flights across Europe? And the poor chap has a young bride to support.

Ryanair was this week punished for pushing its luck when setting up a deal with the airport at Charleroi, south of Brussels, that involved Belgian taxpayers not simply forgoing the normal landing charges but also stumping up for the airline's office equipment and hotel bills.

"This won't affect rich people, it will affect ordinary people", says Mr O'Leary. "We stand on the threshold of European integration, but today's decision is a disaster - it's reversing 20 years of progress in low-cost aviation."

"He's furious because he hates competition", counters Mark Watts MEP, who speaks on transport for the Labour group in the European Parliament. "Why should just Ryanair bully its way into these regional airports with cosy sweetheart stitch-up deals?"

Mr Watts says the new deal will mean "lower fares and more flights". Yet it looks to me that the European Commission has spent two years and millions of euros on its investigations, the effect of which will be higher fares and fewer flights. But then I do not move in the same illustrious travel circles as Mr Watts. MEPs, he tells me, are given a flat rate of "four or five hundred pounds" each time they travel to the parliament in Brussels or Strasbourg. To qualify for such generous reimbursement, our elected representatives need only show a used boarding pass, even if the sum shown is only a fraction of the allowance. Now that's what I call state aid. (To his credit, Mr Watts is pushing for the radical step of MEPs reclaiming only what they actually spend on travel.)

Mr O'Leary might not fare well in a job interview for Ireland's diplomatic corps, and is said to have antagonised a number of senior figures in Brussels. Yet for the European Commission to persecute an airline that has rescued a depressed area of Belgium from economic oblivion strikes me as a strange fight to pick. In terms of fair competition, much else is rotten with European aviation.

Why, for example, should a leading UK airline, BMI, not be able to fly consumers between London and America? And what possible justification is there for excluding major US airlines such as Continental, Delta and Northwest from Europe's prime gateway, Heathrow?

At least we have a thriving domestic aviation market in Britain, with British Airways and BMI competing with easyJet, FlyBE, Ryanair and others to offer low fares. I remain mystified why France does not. This nation is twice the size of the UK, with the same population. Sure, it has a formidable rail network that renders aviation obsolete on routes such as Paris to Lyon. But anyone travelling from the capital to Toulouse or Strasbourg faces a long train journey; when Mr Watts attends parliamentary sessions at the Rhine city, he takes Eurostar to Paris and flies the rest of the way.

A year ago yesterday, Air Lib went bust - bringing to an end France's most substantial venture in no-frills flying. The collapse should have provided the chance for easyJet, a well-run and profitable company, to expand its high-frequency, low-cost operation for the benefit of French domestic travellers. Yet most of Air Lib's precious slots at Orly airport in Paris ended up in the hands of Air France.

Strange.

Loyola de Palacio, whose extravagant name sounds like an upmarket hotel in Madrid, is Europe's transport commissioner. Ruling against Ryanair on Tuesday, she made it sound as though the provision of state aid to benefit travellers was an outrage to the long-suffering taxpayers of Europe. Well, chaps, I'm afraid to say that state aid has been a feature of travelling life for decades, and long may it continue.

Each time you board a Eurostar train or a Transmanche ferry, you are enjoying a subsidy from the French taxpayer. France believes that it is worthwhile pumping money into transport in order to boost jobs and enhance regional economies. So do we: last year our government gave the rail network around £4bn. One billion train journeys were made. You do not need Michael O'Leary's business acumen to calculate that every trip was subsidised by an average of £4.

Travellers to or within Scotland are lavished with cash. If you study the accounts of the fine ferry operator, Caledonian MacBrayne, you will notice a figure for "deficit grant per passenger" of £3.87. Yes, that's the amount the Scottish Executive puts towards your voyage. Indeed, CalMac's earnings cover only 70 per cent of its costs.

In the air, the benevolence is even greater. Highlands and Islands Airports Ltd, which runs Inverness and other far-flung Scottish airports, was paid £24m in state aid last year. Fewer than a million people used the airports, each subsidised by a whopping £28.

Londoners should not whine about the rest of Britain getting stacks of cash. The capital has the majority of National Museums, which between them received £447m in subsidy. With around 50m visits, that works out as a generous £9 per person - which, incidentally, is the average profit Michael O'Leary makes on each Ryanair passenger.

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