ALEX BRUMMER: Heathrow is holding Britain back… but its money boss seems to be living in a parallel universe
Heathrow’s well-paid chief executive, John Holland-Kaye, lives in a parallel universe.
As Britain’s busiest airport removed a further 61 flights from Monday’s schedule, Holland Quay praised its team for providing an “excellent service to the vast majority of passengers”.
Many people traveling through the airport in recent days will have a different version of events.
Flight of fancy: Heathrow boss John Holland-Kaye said his team was providing an ‘excellent service to the vast majority of passengers’
I went to Heathrow at the weekend to pick up a close family member who was visiting from Austin.
The BA flight left Texas late but made up for the ten hour flight to Heathrow. When it arrived at the UK’s main airport, the plane was held on the tarmac for 20 minutes waiting for a place to disembark.
Passports were issued quickly. The same cannot be said about luggage in Terminal 3. Waiting for the first boxes on the conveyor belt took two hours.
The airport did not communicate in any way what was happening and the airline did not reassure passengers that their bags were on their way. When it’s great service, it’s hard to think what happens on a bad day.
Holland-Kaye’s solution is to cut flights again to create more misery. It’s the same airport operator that sought to raise landing fees, introduced a difficult-to-navigate and contested drop-off charge (the chief executive of a major FTSE 100 company disagreed last week) and higher parking charges.
The slower the baggage handling, the more outrageous the parking fee.
Heathrow can avoid the slings and arrows of UK-based and owned infrastructure as the owners of Ferrovial and a bunch of investment funds are out of reach for most consumers.
Holland-Kay says the inconvenience is “unacceptable”. It’s also the unsavory airport job or the fact that Holland-Kaye’s remuneration package was £1.5m last year.
All carriers and airlines are finding it difficult to adapt to the growing demand for travel. Wizz Air announced it was cutting its summer flight plans by 5 percent, sending its shares tumbling.
But while so many operators struggle, low-cost carrier Ryanair, which has decided to keep its staff intact during the pandemic, is proving to be a real winner in the sector.
Heathrow’s failure to operate harms passengers, airlines and post-Brexit Britain.
The UK economy depends on global services. Heathrow needs to be best in class if business travel, the city’s lifeblood, is to thrive.
The digital divide
Fintech is an area where the UK is a leader. It is a pity that many stars in this bright sky are losing their luster.
Revolut operates with a Lithuanian banking license and is fighting for approval in the UK. Krista Kaarman, chief executive of the brilliant money transfer service Wise, is under investigation for chaotic personal taxes.
And buy-now-pay-later champion Klarna has suffered a catastrophic price drop. A year ago, it was the high of a round of funding that raised its valuation to £38bn.
It is valued at £6.3 billion after its latest fundraising. Klarna has been riding the e-commerce bubble during the pandemic and is suffering from a decline in discretionary spending on e-platforms.
The fact that it can still raise funds shows that the model is still considered viable. Executive director Sebastian Semiatkowski’s claims that the latest fundraiser is “a testament to his strength” should be taken with a grain of salt.
In much the same way that Wise challenged the entire structure of foreign money transfers, Klarna is disrupting the opaque credit card market dominated by Visa, Mastercard and others.
Confidence that it will be an Amazon or Apple finance company is fading fast. Its best future may be as the cyber banking arm of a Silicon Valley player or a consumer bank.
There will be a price to pay for the tax cuts needed to prop up the economy through global energy disruptions.
Predictably, foes of the £72 billion HS2 have targeted the high-speed link from London to Birmingham and Manchester.
Savings in public expenditure, if they are to be made, must come from expenditure, not from the capital account. The value of visionary investment is there for everyone in the Eurotunnel and now on the Elizabeth line.
World-class infrastructure is a no-brainer for a country’s future.