“SIGNIFICANT and legitimate” questions remain over how closely the government monitored the performance of Blue Islands in relation to a multimillion-pound loan provided during the pandemic, a senior scrutineer has argued.
Deputy Jonathan Renouf made the comments after Treasury Minister Elaine Millar gave a statement in the States Assembly yesterday outlining the financial support provided to Blue Islands prior to the airline’s decision to cease trading and enter liquidation earlier this month.
Deputy Millar had previously confirmed that Blue Islands owes the Government of Jersey £9.1 million – including £7m of an £8.5m loan given during the pandemic and £400,000 of interest on that loan, as well as more recent financial support of £1.2m and £500,000 provided in September and November respectively.
Deputy Renouf said: “There are still significant and legitimate questions for government to answer, concerning what work was done to monitor the performance of the company after the initial loan was issued and before the emergency situation that started in June.”
Blue Islands halted operations on Friday 14 November, stating that – despite “constructive” dialogue – it had been informed that the government was “unable to provide further support”.
Speaking to States Members yesterday, Deputy Millar said that government support for the firm had been “two-fold”.
“First, during Covid to keep essential lifeline air links open and, second, to support them more recently while they sought to find a new shareholder through a sales process or to find an alternative long-term solution for their viability,” she said.
Detailing the initial support given to the airline to ensure it could continue operating during the pandemic, Deputy Millar said: “Government provided funding to Blue Islands through a £10 million loan facility, of which £8.5 million was drawn down.
“This support, provided in the middle of 2020, secured lifeline connectivity during a period of unprecedented disruption and allowed Blue Islands to establish itself as an independent airline operating from Jersey.”
Later in the sitting, Deputy Renouf highlighted concerns raised in a report by Jersey’s Comptroller and Auditor General, who said there was “no evidence” to show that Key Performance Indicator information had been “systematically collated, evaluated and reported on during the period of the loan”.
Deputy Renouf asked: “Does the minister regret the fact that government did not pay more attention to the performance of the loan earlier?”
But Deputy Millar said that it had been “monitored regularly”.
“Representatives of both Ports of Jersey and [the] Treasury [Department] attended all Blue Islands board meetings as board observers,” she continued.
“This started in 2020 when the Covid loan was made, and they attended all board meetings, so we knew very much what was happening with Blue Islands.”
Deputy Millar also stressed that “the main purpose of the Covid loan was to keep the airline operating during the pandemic”.
“Anybody here who had relatives who had to fly to Southampton for medical treatment during that period – in fact, any Islander who had to fly to Southampton or who had to leave the Island for any urgent matter during that period – will be, I am sure, grateful of the fact that we made that loan and kept Blue Islands flying.”
Outlining some of the key performance indicators “from memory”, Deputy Millar added: “Firstly that they kept flying and that they maintained regional air links. They did that. They maintained links to Southampton and either then or later to Exeter and Bristol and various other airports.
“So they did do what they were asked to do. They carried, I think, some 650,000 passengers in the time since 2020.”
