State to subsidise select Adria routes
The Slovenian government has said it is seeking to modify the country’s aviation legislation which would enable it to subsidise a select number of Adria Airways’ routes. The Slovenian Deputy Prime Minister and Minister for Infrastructure, Alenka Bratušek, noted, “The proposed new law on aviation would allow some forms of subsidies on certain routes. But it would be four or five destinations, not all of Adria’s flights”. Late last year, the airline won a tender organised by the Slovenian Ministry for Public Procurement for the transport of state employees from a dozen different public institutions to Brussels, worth 4.5 million euros. Furthermore, Adria won a twelve-month contract worth 127.897 euros for the transport of postal items for the Post of Slovenia.
The newly proposed subsidies would provide a lifeline for the Slovenian carrier which has fallen on hard times in recent years. It is yet to submit its 2018 financial report to the Slovenian Civil Aviation Agency, which is in breach of European Union regulations. According to EU rules, airlines are required to submit their audited balance sheets to the local civil aviation regulator within six months of the end of the business year, or within the deadline outlined by national legislation, which in Slovenia’s case is on August 31. Adria’s CEO, Holger Kowarsch, previously said the loss would be significant and in the double digits.
During talks between Adria’s management and Slovenia’s Prime Minister in May this year, the carrier requested funds and assistance from the state for the upkeep of certain routes. Although the company denied such reports, a leaked transcript of the meeting showed that such an appeal was made. Ms Bratušek previously said the government had no means to directly aid Adria until 2021, as the company was a recipient of state funds in 2011. Under EU regulation, the government is barred from providing further financial assistance to the airline until a ten-year deadline has passed. Earlier this year Mr Kowarch, "Slovenia needs its airline, because it is very important for Slovenian society, tourism and economy that a national carrier operates from Ljubljana Airport". At the time, he added that the company would not file for bankruptcy, "contrary to what many wished for".
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