Public funds in support of Blue Islands

2025.11.25

3.8   Deputy K.M. Wilson of St. Clement of the Chief Minister regarding the risks to public funds in relation to the Government's financial support of Blue Islands (OQ.260/2025):

Will the Chief Minister advise why the Assembly was not informed earlier of the risks to public funds in relation to the Government's financial support of Blue Islands?

Deputy L.J. Farnham of St. Mary , St. Ouen and St. Peter (The Chief Minister):

As Members heard this morning from Deputy Millar 's statement, financial support was provided to Blue Islands to safeguard essential air links, especially - and I underline the word - for medical appointments, often lifesaving medical appointments that Islanders need to Southampton and to protect the half-term holidays and other important parts of the tourism season, while the company explored longer-term solutions to its financial challenges. Making that financial support public at an earlier stage would have compromised the company's efforts to save the airline, enhancing an already difficult situation. If the airline had failed without a plan in place for rapid transfer to another carrier, there would have been an extended period without service and a far greater disruption for passengers, especially those in need of medical treatment. The Government supported Blue Islands for as long as possible until the extent of its financial position, ultimately, became clear. The Minister for Treasury and Resources and her team provided high-level confidential briefings to the Corporate Services Scrutiny Panel in July and September, and we are grateful to them for respecting that confidentiality. Within 24 hours of the decision not to continue to provide funding to Blue Islands, States Members were informed at a briefing at 2.00 p.m. on Saturday, 15th November. It would have been unacceptable to accept an option that disrupted our essential medical air link to Southampton, and I just wanted to reinforce that point.

1. Deputy K.M. Wilson :

Thank you to the Chief Minister for his response. The question is really about how Islanders can have confidence in the Government's stewardship of the funds when significant risks were known internally but were kept from the Assembly until after their collapse. I wonder if he would like to answer how he can assure Islanders that there is appropriate public stewardship.

Deputy L.J. Farnham :

I would like to reassure Members and Islanders that by taking the decision that we have taken in the course of the 12 months we have saved taxpayers many, many millions of pounds moving forward, perhaps tens of millions of pounds. I am reminded of the headline not so long ago just before COVID: "Guernsey bails out Aurigny from the brink of liquidation." Since 2015 the States of Guernsey have had to subsidise Aurigny to the tune of somewhere approaching £75 million. They are, I understand, a 5-fleet airline the same size as Blue Islands. While we have invested money and loaned money to Blue Islands in the past, I believe we had to do that to keep them moving. The last thing we were going to do during a difficult tourism season was disrupt their service. What we have done is we have carefully considered the situation. As the financial difficulties became worse, we took what we believed to be the relevant action. I want to thank officials, Ports of Jersey and all that have worked hard together to make sure a new service was stood up in a very short period of time.

2. Deputy J. Renouf of St. Brelade :

If I may test the limits of relevance in the question here, on the assumption that this is about consultation and about who was informed and who was not informed and when, would the Minister comment on the decision not to involve Guernsey in any of the discussions around this and ask whether he anticipated or whether anybody in the Government anticipated that Guernsey, because they were not involved in discussions, might take retaliatory action in the form of designating routes to protect Aurigny's position?

The Bailiff :

This is about why the Assembly was not informed earlier, not about discussions with Guernsey. Deputy J. Renouf :

Sir, I am justifying it on the basis that it is about who was informed and who was not informed and the question of whether Guernsey was informed or not is another branch of that.

The Bailiff :

This is about the Assembly not being informed, not about discussions with Guernsey. I do not allow that question.

Deputy J. Renouf :

In which case, can I ask a different question? The Bailiff :

Yes, you can ask a different question.

3. Deputy J. Renouf :

No, I am not reframing, it is a different question. The question around the Assembly being informed has focused on what has happened since June. But the questions I asked earlier of the Minister for Treasury and Resources were about the knowledge of events before that and the seriousness of the situation once a company stops paying the airport and asks for its loans not to be repaid anymore. Why was the decision taken not to discuss that with the Assembly?

Deputy L.J. Farnham :

First of all, I would like to refer the Deputy to the detail provided in the Minister for Treasury and Resources' statements. I refer to my original answer, the Government often when it is dealing with highly sensitive and commercially sensitive issues has to be mindful of how public that should be made. Bringing a statement or an update to the Assembly in this public forum would have compromised the Blue Islands' ability to continue to trade. What the Minister rightly did was confidentially briefed the Scrutiny Panel, that is the way, I think, Government operates. As soon as we were in a position that we could share the information, as soon as the decision was made, we briefed Members in under 24 hours on a Saturday. Because we were very keen to ensure States Members were properly briefed and understood the pathway we had to take to get to that position.

4. Deputy K.M. Wilson :

Given that we now know what has happened, would the Chief Minister commit to publishing the risk assessments and internal briefings that were heard in relation to how the loans were organised and any analysis to suggest that the loan was unlikely to be recovered?

Deputy L.J. Farnham :

I am not sure I can commit to that. There is a liquidation process underway. There is an element of commercially confidential information. There are other airlines that this information could be useful to sell or not. I cannot make a commitment. Obviously we would like to be as transparent as possible but we can only act in the realms of what is sensible and appropriate.

5. Deputy K.M. Wilson :

Could the Minister perhaps clarify what he is prepared to disclose? Deputy L.J. Farnham :

I think so far we have disclosed about everything, I think, that is relevant to the decisions we have made. I do not think there would be any problem in sharing any confidential information with Scrutiny or perhaps Members on a confidential basis. But that is something we will consider moving forward. I think we have given a clear and rational explanation of the actions that led to the decision made. Now we must step back and let the liquidators do what they have to do.