Flybe faces mounting pressure to back down over charges
By NEIL RIDDELL
FLYBE and Loganair are coming under growing pressure to reverse the introduction of vastly inflated ancillary charges and fees for flying in and out of Shetland.
The budget airline takes over Loganair’s franchise from this Sunday and The Shetland Times is today launching a petition calling on Flybe at the very least to reduce its charges for buying seats by credit card to the £4 per booking levied by outgoing operator British Airways, on the grounds that the company is exploiting its monopoly position as the sole commercial airline operating between Shetland and the UK mainland.
Flybe is now charging £3.50 per passenger per flight with a minimum charge of £5.50 and has also introduced a £1.50 per passenger per flight charge for using a debit card, which previously did not cost anything extra and which many islanders believe should be removed.
Although the company has refused to say how much it is being charged by the banking sector, it is widely believed that the actual cost to Flybe of each transaction is only a few pence.
In addition, this newspaper is also calling for the abolition of seat reservation charges.
The petition has this week received the endorsement of 19 of Shetland’s 22 councillors.
Flybe, which has also been reported to the Office of Fair Trading (OFT), has said in recent weeks that it is used to running services to islands like Guernsey and Jersey, but it does not have a monopoly on air provision in and out of those substantially larger communities, both of which are popular tourist destinations.
In addition, the air discount scheme (ADS) funded by the Scottish government is only applicable to the basic fare for flights, but not to additional taxes and charges, meaning a higher proportion of the total cost of flying in and out of the isles is not covered by ADS under Flybe’s business model.
Shetland MSP Tavish Scott said he “strongly welcomed” the petition and said the number of people who have contacted his office over the card charges had been greater than for any other issue in a number of years.
Northern Isles MP Alistair Carmichael said he would be tabling an early day motion in the UK parliament based on the petition because some of the charges are “outrageous”, while the booking process is “cumbersome and less than accessible”.
He said: “I am already aware of the substantial concern in the community about the high level of charges. Flybe must understand that unlike the routes they have operated previously they are now providing a lifeline service to an island community which brings with it obligations to provide a service that meets the needs of the community. I am deeply concerned that the present set-up may suit their existing business but is not appropriate for a service to Shetland.”
The councillors behind our petition are: Gussie Angus, Laura Baisley, Jim Budge, Alastair Cooper, Sandy Cluness, Addie Doull, Betty Fullerton, Iris Hawkins, Robert Henderson, Jim Henry, Andrew Hughson, Bill Manson, Caroline Miller, Rick Nickerson, Gary Robinson, Josie Simpson, Cecil Smith, Jonathan Wills and Allan Wishart. We were unable to contact Allison Duncan, Florence Grains or Frank Robertson before we went to press.
Mrs Miller said that, speaking as a retailer, Clive’s Record Shop faces a charge of around 15p to make a sale by debit card and 1.5 per cent of the total value of the sale for a credit card transaction, which would be much less for a company with turnover the size of Flybe’s. The company took in £536m in revenue in the last financial year and made an after-tax profit of £34.9m. “The greater the turnover, the greater the discount,” she said. “I think they are using the credit card charges to profiteer.”
Mr Cooper agreed and said that if many small shops in Shetland could manage without imposing substantial credit card charges, he was quite sure Flybe could too. He said that in general he wanted to give the airline a chance to perform before judging them but that after common sense had prevailed over baggage limits, the credit and debit charges were the one issue that was continuing to aggravate him. “From the outset, that’s just another way of them hitting the travelling public and I don’t think it’s justified,” he said.
Shetland North member Bill Manson endorsed the terms of the petition but also said he thought there was a case for the UK government to force airlines to advertise the precise amount that a customer will end up paying, including various taxes and surcharges. He said: “I think it’s time they introduced some sort of legislation, or a measure, that the figure advertised should be the figure the customer pays,” he said. “I would certainly advocate, and would like to see, the charge minimised back to British Airways prices and maybe less.”
Councillor Hughson said using the Flybe site to make a booking without losing extra money was like a “minefield”, while Mr Smith said it was important to support the people of Shetland who could “do without all these added bits and pieces”.
Meanwhile, Lerwick community councillor Michael Peterson has reported the matter to the OFT, stating that he believes Flybe is abusing its market position in the Scottish islands “to impose unfair trading conditions that result in breathtaking per flight segment credit card and debit card surcharges which bear no relation to the real costs incurred by the airline for processing purchases made these ways, and an online booking system designed to entrap the unwary passenger into committing him/herself into additional costs”.
Following pressure from islanders and this newspaper, Loganair and Flybe have agreed to back down on plans to introduce a 15kg weight limit for baggage on flights and have also reneged on plans to charge offshore workers to change their flights at short notice.
A statement from Flybe repeated that credit card charges are “an inescapable way of life in modern commerce” and maintained that the charges “are in line with the cost it bears”. A spokeswoman said the company “continually reviews all its charges to ensure they comply with fair market conditions. This review naturally also includes the charges related to credit cards.”
You can sign our petition by filling in the coupon in this week’s Shetland Times or by sending an email to email@example.com.