Concerns mount over Luton Airport’s Council owners as debts mount and their accountants QUIT as disagreements boil over - could the airport go bust?
With eye-wateringly high debts the owners of Luton Airport known as Luton Rising which in turn is owned by Luton council according to a report in Airport Watch is in danger of ‘sinking.’
In a news story published last month by the trade publication a local campaign group called Ladacan has discovered documents with statements by the company secretary which revealed the shocking state of the airport’s finances.
Airport Watch reported: “The statement by company secretary Mark Turner that PricewaterhouseCoopers have resigned as auditors does not inspire confidence, in a company now burdened by eye-watering debt. The resignation follows a serious disagreement between the auditors and the directors over the valuation of the Airport. PricewaterhouseCoopers’ independent assessment put it in the range £835 to £1,300m, and they disagreed with the Luton Rising valuation of £1,488m.”
The background to all of this is the amount of cash the Council via the Luton Rising had pumped into the airport and its plans for a light railway transit system linking the airport to the railway station.
Luton Borough Council’s own auditors, Ernst and Young, have also been raising serious concerns said Airport Watch - during their efforts to sign off the Council’s own accounts. During the Audit and Scrutiny meeting in January 2022, Robin Porter (LBC Chief Executive) closed down discussion on valuation by insisting that £1.5bn was appropriate and apparently closed down further scrutiny.
Councils and even airports have been known to go bust despite councils technically cannot go bust but it has happened from Croydon to Slough and from Liverpool to Northamptonshire. And in recent years Plymouth Airport closed due to a lack of business.
ICSM said suppliers to financially troubled councils should be treated as any commercial organisation. Ian Carrotte of ICSM said that if a council is not pay their bills on time then treat them with caution. He said: “Cashflow is king and if payment is being spun out to more than your credit terms then any business needs to decide if the work is worth it as opposed to the risks.”
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For details for the work of the journalist Harry Mottram visit www.harrymottram.co.uk