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Ryanair chief: Burnham Government ‘all talk, no action’

Michael O'Leary
Michael O'Leary warned that the airline industry was 'facing a real crisis by next March or April' - AFP/Tolga Akmen

Andy Burnham's meaningless policy announcements and lacklustre first Budget have exposed him as "all talk and no action," according to the chief executive of Ryanair.

Michael O'Leary said the Prime Minister had squandered the momentum of his rapid rise to power by "dithering" over vital decisions.

He said: "Burnham has a lot of goodwill towards himself, a bit like Blair when he first got elected. But in your first 100 days you need to move quickly and break things.

"All he's doing is issuing more fuzzy WhatsApp messages on social media. It's an all-talk government, no action. It's depressing."

The Ryanair boss is preparing to freeze workers' pay as a €2bn (£1.7bn) jump in fuel costs, Labour's tourist tax and a rise in air passenger duty (APD) force the airline to seek savings from workers and increase fares.

The low-cost airline was hit by a 15pc drop in profits between April and September.

Mr O'Leary said airlines need all the help they can get from policymakers as they battle soaring jet fuel prices caused by the Iran war.

The Irishman criticised the Chancellor for a lack of support in last week's Budget, claiming it "set the tone" for a string of anti-business policies under Mr Burnham's Government.

Mr O'Leary said the Prime Minister's commitment to fostering growth in every postcode was incompatible with the new levy on overnight stays and increases in APD inherited from Rachel Reeves.

He said: "The only industry that will deliver that growth is aviation and tourism, and yet they are raising taxes on aviation and tourism.

"All that is going to do is send more visitors away from the UK to other European countries who are abolishing taxes and lowering airport fees."

He said Mr Healey should have rolled back the APD increase and that the hotel rooms levy amounted to "a mad proposal to allow local mayors to double-tax visitors".

The Ryanair boss warned that this could ultimately see flights from the UK reduced if Labour persists with its current fiscal policies.

Airlines are battling the effect of tax rises alongside soaring jet fuel costs caused by the Iran war.

Ryanair has been shielded by hedges that locked in prices on 80pc of its fuel this year. However, that falls to 25pc from March as contracts unwind.

He said fares would have to rise by 20pc – or €10 on a €50 average ticket – to offset the whole of the increased fuel bill, an increase the market is unlikely to be able to fully absorb.

Workers in the UK, Spain, Portugal and Ireland will therefore be required to shoulder some of the burden, the airline boss said.

He said there was "every likelihood that we will have a pay freeze".

Airline industry faces 'real crisis'

Mr O'Leary also suggested that potential strike action would ultimately save Ryanair money given the current climate.

"It costs a pilot a grand a day to go on strike at Ryanair, and when unhedged oil is $150 a barrel they'd be doing us a favour," he said.

He added that the industry was "facing a real crisis by next March or April" unless Donald Trump strikes a peace deal with Iran, paving the way for the Strait of Hormuz to reopen.

Oil prices fell at the fastest pace since August on Monday, although Brent crude, the international benchmark, is still trading at $108 a barrel.

Separately, Mr O'Leary said airlines had also been looking to the Government to abandon a mandate forcing them to switch to use at least 10pc sustainable aviation fuel (SAF) by 2030 – the most stringent such requirement worldwide – even though none is produced in the UK.

He said: "Ultimately they'll dither around and do nothing because they like pontificating on about it. But the reality is there is no prospect of it because there is no SAF production under way in Europe.

"We're paying enormous amounts of environmental taxes, which is just a scam on air travel that's just being trousered by governments."

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