§ Mr. Colvinasked the Secretary of State for Trade if he will make a statement about British Airways external finance limit for 1981–82.
§ Mr. SproatBritish Airways external finance limit for 1981–82 was set in November 1980 at £101 million.
171WIn September 1981, following recent losses, British Airways announced a series of measures in order to improve its future financial position. These included a voluntary redundancy programme, part of which is to take place in the current financial year, aimed at achieving substantial savings in staff costs.
In order to help finance redundancy payments to be made in the current year, the Government have agreed that British Airways should be permitted to borrow up to £53 million in 1981–82, in addition to financing permitted under its existing external finance limit. However, this additional borrowing is to be repaid by the end of March 1983 and will be available to British Airways solely for the purpose of financing redundancies.
The increase will be met from the contingency reserve and will not therefore add to the planned total of public expenditure.